Tips to ensure a successful Life Cover Claim
During a bereavement, no spouse or family member wants the additional stress of being told that a claim against the life cover on the deceased person’s life has been rejected by the insurer.
Hearing incidences of life insurance companies not paying out claims in respect of life cover benefits can be stressful for clients who have life and other risk cover in place and who are diligently maintaining their premiums.
Here are a few tips to ensure that you or your family are not placed in the predicament of not being covered, in event of having to make a claim against a life insurance policy:
Always insist on a quotation before signing up for any life cover policy and make sure that you read the fine print carefully. This will ensure that you understand the terms on which the cover has been provided, and ensure the information about yourself that the insurer is providing the cover based on is accurate and correct. Things to look out for include the following: does the cover provide for payment in respect of death resulting from natural and unnatural causes (accidents) or does it only provide for accidental death cover? Is the information pertaining to you correct i.e. date of birth, smoker status, highest education level, job description, percentage of time spent doing manual work, administrative work and travelling for work related purposes?
Always ensure that you provide full disclosure to the insurer prior to the policy inception date, when completing the relevant application forms for your insurance. This includes full disclosure regarding any previous or pre-existing health conditions (no matter how insignificant in may seem at the time), correct information regarding your smoker status and other lifestyle factors (including how much alcohol you drink per week), hazardous hobbies or pursuits such as sky diving, paragliding or scuba diving, if you intend travelling outside the borders of South Africa and how frequently, any hazards or dangers you may face within your normal duties of performing your current occupation. Disclosure of this information upfront means that the insurer can assess your overall risk profile and set out the terms and conditions on which they are willing to provide your cover upfront (so there are no surprises later).
Very importantly, the onus will also rest on you to inform the insurer of any changes to your occupation, smoker status, hobbies and avocation and countries you may travel to for leisure or business during the term of the policy.
Be wary of life insurers who offer you cover without you having to undergo underwriting prior to the policy been put in place. Underwriting involves an assessment of your current health and lifestyle through a series of medical and non-medical tests and questionnaires for the insurer to assess your risk profile and your insurability. Some insurers will provide you with cover upfront which involves minimal or no underwriting at all. These insurers often end up doing underwriting on the insured person at the time of claim which creates uncertainty in terms of whether a claim will be paid or not (especially if the insured had a pre-existing condition they were not aware of when taking out the policy).
Lastly always make sure that you have sufficient funds to cover the premium on your life policy when it is due. If a policy falls into arrears the insurer has no obligation to process a claim on that policy in event of a claim.