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You can alter health plan’s sum insured at the time of renewal

Most health insurance policies have a waiting period of two to four years for pre-existing diseases

My husband had taken a unit-linked insurance plan (Ulip). After he passed away, the claim was raised automatically and was rejected. The company said that he didn’t declare his other policy details. Can I still get any claim amount? The form was filled by the agent and even the nominee’s name was misspelt.

—Praveena

In several cases, adjudicating authorities have reversed claim rejection if the policyholder’s non-disclosure would not have impacted the insurer’s underwriting decision. Declaration of other policies is important for financial underwriting. Insurers are generally comfortable to issue coverage up to 10 to 15 times of a person’s annual income. In your case, if the aggregate sum assured across all policies is less than the above threshold, you will have a strong footing to represent your claim to the insurance ombudsman. In any case, the company is obliged to pay the current fund value of the Ulip.

The plea that the intermediary would have filled the form is not a strong one. All proposal forms have to be signed by the proposer. Also, proposal forms are included in the policy copy docket.

I had taken a health insurance policy of 5 lakh for my father, but the expenses for a recent hospitalization came to around 10 lakh. With few months still left in the year, is there a way to increase the cover?

—Prabhaat

Sum assured changes are allowed by insurers only at the time of policy renewal. Also, it is not possible to increase the sum assured in the middle of the policy year after a claim has been reported. You should however check if the policy has a restore feature. This feature allows resetting of the sum assured once the base sum insured is exhausted.

If you decide to increase the sum assured at the time of renewal, you should be mindful that the insurer is likely to apply fresh waiting periods on the enhanced sum assured. Most health insurance policies have a waiting period of two to four years for pre-existing diseases. The concerned ailment would fall under pre-existing disease for the enhanced sum assured, and thus would be subject to this waiting period.

Abhishek Bondia is principal officer and managing director, SecureNow.in. Queries at mintmoney@livemint.com

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