Kathmandu. Insurance is a legal contract. In which there is an agreement between the insured and the insurer to pay the premium subject to the terms of the policy and in return, the insurer will bear the risk.
Although an insurance policy is a valid contractual document, it may lose its validity in some circumstances. That is, in case of violation of the terms mentioned in the insurance policy or in violation of the universally accepted principles of insurance, the insurance policy is considered invalid.
Here are some of the risks and circumstances of rejection of an insurance policy.
1. Insured Article Exception:
Every insurance policy includes exceptions that lead to insurance claim denial. In particular, the exception clauses are mentioned at the bottom of the insurance policy in the case of life insurance policy. In the case of these exceptions in the insurance policy, the claim is rejected:
• Suicide (within 24 months from the date of issuance of policy)
• Death due to illegal activities (crime, motorcycle race, kava eating, illegal flight)
• War, Riots, Nuclear Risk
• Certain diseases (health conditions that make health insurance ineligible for health insurance)
2. False details or limited disclosures:
In this case, the policy is void, there is no payment from the insurer.
• Hiding treatment history (if the insured does not provide information about any chronic disease such as cancer, diabetes, hypertension, brain stroke, etc., due to fear of rejection of the insurance offer, the claim may be rejected in the future)
• Smoking and Drinking (Smoking, Alcoholism Not Disclosed in Insurance Offer)
• Incorrect age or income statements (trying to falsify or falsifying age details)
3. Expired insurance account
The impact of an insurance policy that is not in operation is also zero. Such an insurance policy remains inactive until it is revived. Most of the terms and features of the policy become invalid.
• Non-payment of insurance on time
• Renewal deadline exceeded
4. Overinsured or inaccurate insurance plans
When buying an insurance policy, you may not be able to make a decision based on your needs and purchasing power.
• Using insurance only as an investment
• Purchase a term insurance policy for protection, which can lead to low returns and inadequate risk tolerance.
5. Claims within the waiting period
• Waiting periods for health insurance range from 30 days to 180 days.
• No claim benefit will be available for 2-4 years in case of pre-existing diseases.
6. Low actuarial score
• Rs. 3-5 lakh insurance for Rs. 10-20 lakh{
• Term insurance of ₹5 lakh for a family needing Rs. 50 lakh
7. If the nominee is not nominated, there will be only legal delays, disputes, and stress for the family in time to pay the claim.
• Wanted person not updated
• Missing or missing documentation confirming your relationship with the desired person
Insurance is not a guarantee. It is a contract with conditions. So, don’t miss out on the right policy, the right risk, full disclosure, regular insurance renewal, waiting period and regular reviews. If you don’t, your insurance may not work when you need it most.
