A life insurance policy is bought on a simple promise: one's family will be financially protected when it matters most. That promise is put to test at a difficult time—following the death of a loved one, when the family must navigate the claims process, often for the first time.
Awareness of this process, and the documentation needed to speed up approval, remains limited among policyholders and their families. It is therefore important to understand how a death claim moves from intimation to final payout, and what nominees need to do at each step to ensure a smoother settlement.
Claim notification & registration
Following a policyholder's demise, the insurer initiates the payment of the life insurance policy's death benefit to the declared nominee(s) after receiving a claim intimation. Before this process begins, the nominees need to be aware that a policy exists and have access to its basic details. Therefore, policyholders are strongly encouraged to keep their families informed of their coverage.
Once aware, beneficiaries can file a claim with the insurer by providing policy details, the date and cause of death, and contact information. While an in-person branch visit or intimation through the call centre are commonly used reporting channels, insurers have increasingly embraced digitalization which allows nominees to notify a death claim through WhatsApp, website or a dedicated mobile application. Irrespective of the channel chosen, the insurer creates an official claim and shares the claim ID along with expected timelines for processing.
Document collection, verification
Post the registration of a claim, the insurer collects supporting documents such as death certificate, original policy (if needed), hospital records or post-mortem report in case of an accidental death. Many insurers have simplified the list of documents needed based on the cause of death, natural or accidental, along with the provision of uploading the same via digital means.
This added layer of convenience means nominees need not visit a physical branch, unless physical copies are needed for further verification. The documents are then verified and subsequent steps such as bank account validation are performed. If there are no further queries, the insurer verifies the submitted documents, validates the policy, and proceeds with the claim settlement in accordance with the policy terms and conditions.
Claim investigation, decision making
During the first 72 hours after the claim is submitted, the life insurer may assess the disclosed documents and the deceased’s medical history, especially in cases of an early claim. Missing or mismatched details commonly stall a claim, and insurers intimate the claimant in such cases.
Depending on the riders associated with the policy, the insurer may investigate the hospital admission/discharge reports, the attending physician’s statement (Form C) or check the First Information Report (FIR) in case of an unnatural death. At the time of purchasing a policy, it is important for the policyholder to disclose all relevant information, including any pre-existing health conditions, medical history, and treatments received.
Likewise, the beneficiaries or nominees ought to furnish details and reports as requested by the insurer, ensuring they are submitted within the prescribed timelines, either in person or through a digital channel. After reviewing the documents, past medical records and evidence presented, an insurer’s claims officer decides on the claim; with partially or fully approved claims being processed further for payout.
To expedite the claims settlement process, the Insurance Regulatory and Development Authority of India (Irdai) has mandated life insurers to settle non-investigated claims within 15 days, while for those that require further investigation, the resolution period has been halved to 45 days.
Claimant communication & closure
In some cases, the insurer may reject a claim with detailed reasons, relevant policy clauses and subsequent grievance redressal options available for the claimants to pursue. However, with the Indian life insurance industry recording a claims settlement ratio in excess of 97% in the recent past, such rejections usually occur due to fraud, duplicate claims being raised or specific policy lapses.
On their part, leading life insurers ensure proactive communication at every step in the claim settlement process, even as they leverage advanced digital technologies to establish strong fraud controls that do not delay the settlement of routine claims.
As the pace of digitalization ramps up further within the Indian life insurance industry, beneficiaries can come to expect greater speed, fairness and speedy payouts for a stress-free claim experience in the foreseeable future.
The author is MD & CEO of Generali Central Life Insurance. Views are personal