PRESENTED BY:

Kapil Dev Sharma

Kunal Dhawan
Naved Sami
Pooja Babber
Vishal Sharma

Essential Elements of Insurance

Concept of Claim
Amount payable
Types of Claims
Processing of Insurance Claim
Guidelines
Disputes in Insurance Claim
Rejection of Claim
Summary

Concept of Insurable Interest

Doctrine of Good Faith

Proximate Cause

Claim is a right of insured to receive the amount secured

under the policy of insurance contract promised by
Insurer

Insurance Claim is the request of the insured policy

holder/beneficiary from the insurer/insurance issuing
company for financial reimbursement whenever he/she
suffers a loss of the insured property/life/health/etc

Insurer- settle the claim after satisfying himself that all

the conditions and requirements for settlement of claim
have been compiled with

Should be done in accordance with the specifications

of the insurance policy/contract

The amount insured or face value of policy

Bonus if declared by company

Share of profit in case of participation policy

Surrender value if policy lapsed

Payable as per the terms of contract- at the end of the term

Insurers inform the policyholder well in advance about the
maturity date
Insurers send the form of discharge which is duly signed, and
returned witha)
Original Policy document
b)
proof of age- to prove the identity
c)
Document of assignment- if executed on a separate
stamped paper
Gross amount includes basic sum assured, bonus etc
Deductions include loan amount, unpaid premium etc.
Circumstances like settling the claim on the basis of
indemnity bond require more caution (in case original policy
is not found)


A.
a)
b)
c)
B.
a)
b)
c)
d)
e)

Intimation of death by a proper person and proof of

death
Premature/early claim: insured dies within 3 years of
taking out of policy
statement from the last medical attendant giving details
of last illness and treatment
Statement from the hospital
Statement from the employer
Other claim : insured dies after 3 years of taking out of
policy
Policy number and Name of life assured
Date and Cause of death
Claimants relationship
Death certificate
Deeds of assignment

C.
a.
b.
c.
d.

In case of unnatural death: accident, suicide, or

unknown cause etc
Police inquest report
Panchanama
Post mortem report
Chemical examination report

D.

Under the Indian Evidence Act, a person is presumed to

be dead if he is disappeared for 7 years

Upon the death of the life insured the amount is payable

to the nominee given in the proposal form

Some policies entitled for the survival benefit before

the expiry of the full term of the policy

Settlement is easier than maturity claim

Insurer sends advance intimation and the discharge

voucher which is returned with necessary documents
a)
b)
c)

Proof of identity
Original policy
Document of assignment

1)

The policy holder or the beneficiary calls up the insurer

claiming the insurance asking about all the minute details
of the process of claiming the same along with the
documents required

2)

The insurance company asks for the details of the loss and
the relevant documents in support of the Claim

3)

A notice has to be issued by the policy holder for claiming

the same with utmost urgency mentioning all the possible
details (namely, name of the policy holder, names of the
persons associated with the accident, witness particulars,
their addresses, etc).

4)

The insurance company would make all the possible queries

and inspections by the company representatives or consultants

5)

They have the right to inspect all the relevant properties

related with the loss along with police verifications and
determination of the policy holder's liability structure

6)

The processing period is mentioned in the contract document,

which is the approximate time required for verification of the
genuineness of the Insurance Claim

7)

On agreement of claim amount between the insured and the

insurer, the claim is settled

Claim form

As per IRDA,
Insurance company is required to settle a claim within 30
days of receipt of all requirements

If the claim warrants further verification, the company

should complete its procedures within 6 months from receipt
of written intimation of the claim

If the company settles the claim beyond 6 months period,

then interest is payable by the company on the claim amount

The interest is payable only where the claimant has

submitted all the requirements. Further, rate and period of
interest are decided as per IRDA guidelines


Every insurer, in the case of an insurer specified in sub clause ( a)
(ii) or subclause (b) of clause (9) of section 2 in respect of all
business transacted by him, and in the case of any other insurer in
respect of the insurance business transacted by him in India, shall
maintain:
(a) a register or record of policies, in which shall be entered, in
respect of every policy issued by the insurer, the name and
address of the policy-holder, the date when the policy was
effected and a record of any transfer, assignment or nomination
of which the insurer has notice, and
(b) a register or record of claims, in which shall be entered every
claimmade together with the date of the claim, the name and
address of the claimant and the date on which the claim was
discharged, or, in the case of a claim which is rejected, the date of
rejection and the grounds there for.

Identifying the person to whom the payment is to be made

Whether the payment is within the terms of policy

Whether the amount claimed is reasonable

Proof of Death

Identification of assignee, nominee or the legal heir to whom the

payment is to be made

The main reasons for claim not being passed in full

are :

Insured has pre-existing disease and it was already

mentioned in policy document as an exclusion.
The specific disease is not covered under the policy
Disease is a pre-existing disease and it was not revealed
by the insured at the time of issue of policy.
The main reasons for claim being passed in part are :

Some of the tests conducted/treatment were not relevant to the

disease for which patient was admitted.
Some costs like consumables are not payable by the insurance
company

Claims may arise because of

a) Survival up to end of the policy term- maturity claim
b) Survival up to a specified period during the term
survival benefits claim
c) Death of the life assured during the term death
claims

Insurance claim management is a core issue for the

protection of insurance policyholders

Completed proposal form plays an important role as

it affects the claims under policy

It has been observed that all the Insurance Claims

are not genuine and are fraudulent in nature. So,
every Insurance Claim is needed to be processed by
the insurer before approval in order to avoid
insurance fraud

Need for enhanced efficiency, transparency and

disclosure of information to policyholders during the
claim management process

Mr. Devinderpal Singh, a resident of Jamalpur, had taken a Mediclaim

policy from the company for his 10-year-old son Raja. He was insured for
Rs 20,000 for the period from October 13, 1998 to October 12, 1999. The
complainant stated before the forum that in the first week of November,
1998, his son, felt severe pain in his abdomen. After the medical
examination, a stone was found in his kidney. Thereafter, Raja was taken to
the Sidhu Hospital for the treatment and there he underwent treatment in
November 1998.
The complainant stated that he had spent huge amount on his treatment
but could not preserve all the bills and submitted the bills for Rs 18,500.
The company pleaded that the said policy was obtained after concealment
of the precious disease as the disease was pre-existing at the time of taking
the policy as such the claim was not payable.

The company further stated that Dr Tarsem Lal Gupta who was
referred the case for the medical opinion, said Raja was suffering
from pre-existing disease at the time of taking the insurance policy
and as the claim fell within the exclusionclauseNo.401of the
policy. The company maintained that the claim was rightly
repudiated
The forum observed, "It appears as if the father of Raja had
knowledge of the disease and as such he took the policy to meet the
expenses of the treatment. The forum stated that the disease was
pre-existing and wasnotcoveredunderthepolicy. The forum
further added that the company had intimated the complainant that
the claim lodged was considered as 'no claim' as per the rules of the
policy. The forum held that there was a clear deficiency on the part of
the company for not intimating the complainant
The District Consumer Disputes and Redressal Forum in Ludhiana
directed National Insurance Company to pay Rs 5,000 to Mr.
Devinderpal Singh on account of deficiency in service, even though
claim was not payable.