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Features
Ref. No. KLI/22-23/E-BB/492
An insurance claim is a formal request you make to your insurance company for financial compensation after you have experienced a loss or event that is covered by your plan. At times of unexpected events, such as a car accident, hospital stay, or diagnosis of a chronic illness, you are required to notify your insurer and provide documents as proof. Your insurer then verifies the details, and if your claim is valid, it pays out the entitled amount. The insurance claim for health insurance or life insurance is what turns the promise of your policy into tangible financial support.
The insurance claim meaning refers to the formal request made by the policyholder to their insurer to receive monetary compensation for a covered loss or event. It is the point at which the insurer must fulfill their contractual obligation. Filing a claim starts the process of assessing and validating the event and, if eligible, providing financial support to the insured.
It is the practical application of the promise made by the insurer, turning a policy contract into tangible support when you need it the most. At its core, filing a claim sets in motion the process for your insurer to assess the situation and, if valid and covered, provide the financial relief or benefit outlined in your policy document.
After understanding what is insurance claim, let us see how it works. The insurance company looks over the claim, checks the paperwork, and if everything is in order, they pay the claim. It helps pay for things like hospital bills, lost wages, or living costs during emergencies.
For families who rely on one person to make money, claim settlements can be very important for keeping their finances stable. The claim process helps people and families deal with financial stress during tough times, giving them stability when they need it most.
There are as many insurance claims as Types of insurance plans . These claims depend upon the type of insurance one has chosen. After understanding the meaning of insurance claim, it is imperative to know the various types of insurance claims in India:
Health insurance claims cover medical expenses like doctor visits, hospital stays, surgeries, and prescriptions incurred due to illness, injury, or ongoing medical conditions. Claims can be submitted for specific treatments or reimbursement for already incurred expenses.
Life insurance claims provide a financial payout to your beneficiaries upon death. Different types, like term life, whole life, and universal life insurance, offer varying payouts and benefits. These claims involve submitting death certificates and completing beneficiary forms.
Travel insurance covers unexpected expenses during your trip, such as medical emergencies, trip cancellations, lost luggage, and travel delays. Claims vary depending on the specific event and coverage you purchased.
It covers non-life assets and legal liabilities. You are covered to make a property and casualty claim when your own insured property whether it is your car or house is either damaged or stolen. The purpose of such insurance claims is to recuperate funds to fix or replace items.
Group life insurance claims are under a master policy that a company purchases on behalf of its workers. Unlike individual life insurance, where the nominee deals directly with the insurer, the process here is often facilitated by the employer. This usually simplifies the task of the bereaved family since the employer of the deceased can assist and also guide the bereaved.
Claiming insurance involves notifying your insurance company that you have experienced a covered loss or event and requesting compensation or coverage for the incurred expenses. The process can vary based on the insurance type and the claim’s nature. Here are some general steps that can be taken:
After we have define insurance claim, let us know how you can submit one. Policyholders can usually initiate an insurance claim through several convenient channels offered by their insurer, such as:
Regardless of how you initiate contact, the claim submission process often involves the following stages:
The answer is rooted in the fundamental principle of insurance, which is risk assessment. When you file a claim, you transition from a statistical risk to a demonstrated one. From the insurer’s perspective, your history now indicates a higher likelihood of future claims compared to someone with no claim history. To balance this elevated risk, the company adjusts your premium upwards at the time of renewal to reflect your new risk profile.
Furthermore, the frequency of claims matters. Filing multiple claims in a short period can signal to an insurer that you are a high-risk individual, leading to a substantial increase in the premium.
It is not usually wise financially to claim a sum of money that is less than your deductible amount stated in a policy. To understand why, you first need to understand what is insurance claim and the role of a deductible. A deductible is an amount of money that the person is required to pay out of their own pocket on a claim before the insurer will pay.
Let us use a simple example. Suppose your car suffers a minor scratch, and the repair cost is estimated at ₹4,000. If your policy has a mandatory deductible of ₹5,000, you would be responsible for the first ₹5,000 of any claim. Since the repair cost is less than your deductible, the insurance company would not pay anything towards the repair. You would bear the full cost yourself.
By filing the claim, not only would you receive no financial payout, but you would also create a claim record and likely use your No Claim Bonus (NCB) at renewal, leading to a higher premium next year.
When reporting a claim, the documents you need depend on the type of claim being submitted. Below is a general overview:
Note: Specific documents may vary depending on the exact policy and claim type. Always refer to your insurer’s official claim assistance portal or customer care for precise requirements.
Insurance is more than just compensation—it is peace of mind. A clear understanding of the definition of claim in insurance ensures you are financially protected when it matters most. By understanding what is insurance claim and your policy’s terms before an event occurs, you empower yourself to act confidently and efficiently when you need your insurance the most.
1
To place an insurance claim, you can either contact the insurer via the Internet, on the phone, or at their office. Submit the claims form and any other required documents. The insurance company shall then go through all of it and warn you further what to do.
2
These documents vary with the kind of the claim you are making but they typically involve a completed claim form, a proof of loss, a proof of identity and a bank information. Your insurance company may ask to provide certain requirements. Delays can be avoided by using complete documents.
3
The complexity of a claim and the completeness of the documents will determine the time it takes to process a claim. Minor claims would take a few days whereas complex claims might take long. Insurance companies mostly adhere to the regulatory rules and make their decisions regarding the claims.
4
The insurance company reviews all the documents you bring and may require additional information. They either accept or reject the assertion after giving it a check. In the process, you are going to receive updates on the situation of your claim.
5
Yes, claims may be rejected when they are not made in line with the rules of the policy or when the paper work is incomplete. Claims can also be turned down if the event is not covered or if there is fraud. In order not to be rejected, ensure that you give the right information.
6
Missing documents, filing late, or making claims that are not covered by the policy are some of the most common reasons. Not telling the truth or committing fraud can also get you turned down. Timely and honest communication lowers the chance of rejection.
Amit Raje is an experienced marketer who has worked in various Fintechs and leading Financial companies in India. With focused experience in Digital, Amit has pioneered multiple digital commerce in India. Now, close to two decades later, he is the vice president and head of the D2C business department. He masters the skill of strategic management, also being certified in it from IIMA. He has challenged his challenges and contributed his efforts in this journey of digital transformation.
Prasad Pimple has a decade-long experience in the Life insurance sector and as EVP, Kotak Life heads Digital Business. He is responsible for developing user friendly product journeys, creating consumer awareness and helping consumers in identifying need for life insurance solutions. He has 20+ years of experience in creating and building business verticals across Insurance, Telecom and Banking sectors
Features
Ref. No. KLI/22-23/E-BB/2435
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.
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