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Claim settlements
General Claims procedure
All insurance contracts are based on the information provided by the insured in the proposal form. The correctness of the information furnished in the proposal form is verified at the time of a claim, when physical inspection of the property is done. In case of any misrepresentation, it would be the prerogative of the Insurance Company to avoid a claim, or avoid the policy itself, or pay a claim for a reduced amount.
It should therefore be understood that the completed proposal form plays an important role as it affects the claims under the policy.
Claim settlement procedure for the public sector general insurance companies(New India Assurance, Oriental Insurance, United India Insurance and National Insurance)
Here are some important points, which would help you in the claims procedure.
The loss or damage should be reported to the insurer immediately.
On receipt of claim intimation, the insurer will forward a claim form.
Submit the completed claim form along with an estimate of the loss to the insurer. It is preferable to submit an itemized estimate with separate values.
The insurer will arrange for inspection of the damaged items to assess the loss. In case of major losses, a specialist-licensed surveyor is deputed.
The insured has to provide the required documents to substantiate the extent of loss.
In case the cause of loss is not established, it is for the insured to prove that the loss or damage has occurred due to an insured peril.
On agreement of claim amount between the insured and the insurer, the claim is settled.
In view of varied nature of policies, certain points distinct to individual policies, in addition to the above, are listed below :
Fire claims
Firstly the insured should take all possible steps to minimize the loss.
The fire brigade may be intimated immediately.
Lodge a police complaint in case of a fire arising out of - rioting mob, striking workers, malicious damage by third parties or terrorist damage.
Obtain a meteorological report in case of loss due to cyclone, flood & inundation and if the loss is localized like in the case of flood & inundation from a local water source, MRO report may be obtained.
If the policy is on 'reinstatement basis', the claim is settled only after completion of repairs/replacement of the damaged items and submission of bills for claim payment.
Burglary claims
Immediately report to the police and obtain a non-traceable certificate that the items are not found.
The insurers will insist upon a letter of undertaking on a stamp paper of appropriate value, for refunding the claim amount when the stolen property is recovered.
'All risks' policy for Jewelry and valuables
Breakdown of domestic Appliances
Notice of claim and estimated cost of repairs should be filed with the insurers to arrange for inspection.
In case of partial losses, no depreciation is charged but when the items are not insured for its present day replacement value, the items are treated as under-insured and the claim amount is proportionately reduced. Depreciation is only applied for Total Loss claims.
If an appliance is partially damaged, it should be repaired (on approval from insurance company) before it is put to use, as otherwise further loss is not covered.
T.V.Sets
Notice of claim and estimated cost of repairs should be filed with the insurers to arrange for inspection.
It is at the option of the insurers to repair/replace a damaged item and the insured has no option to insist upon Total Loss and abandon the set.
In extraordinary circumstances, the insurers will arrive at the liability and pay it in cash leaving the option to the insured.
Motor vehicle (Private & two wheelers) claims
Claims under Act policies
Notice of an accident (not necessarily a claim) involving third parties should be reported to the insurers.
The insured may be interested to pay compensation without going into whether he is liable to pay or not. It is therefore an express condition of the policy that no claim should be admitted or a compromise arrived at, without the approval of the insurers.
In case of major claims, the insurers may be willing to defend criminal case against the driver also on the basis of which compensation claims may be decided in the civil courts.
Every accident involving third parties is required to be reported to police. M.V.Act provides that a third party victim can proceed against the insurers directly. If the alleged accident is not reported to the insurers, the insurers can consider this as violation of policy condition. In such circumstances, even if insurers are required to pay compensation by a court of law, they have an option of recovering such claim amounts from the insured for violation of specific policy condition.
The insured can proceed with repairs provided the insurers are submitted an estimate of repairs and the estimated cost of repairs does not exceed Rs.500 in case of Private cars and Rs.150 in case of two wheelers.
Claims under Comprehensive policies
Steps to be taken in case of an accident :
Notice of accident should be filed with the insurers.
If damage is a major one, the accident may be reported before the vehicle is removed from the spot so that the insurers can arrange for spot inspection of damage.
The vehicle may then be moved to a workshop, preferably to authorized workshop, for estimation of repair charges.
On receipt of completed claim form and estimate of repairs the insurers will arrange detailed inspection of damage and cost of repairs will be ascertained.
The insurers will ensure that a person duly licensed drove the vehicle at the time of accident and that the vehicle is the one insured in their books. To that end, they will verify the Registration Certificate and the Driving license of the driver who drove at the time of the accident.
Upon completion of the above procedure, the repairers will be authorized to carry out repairs. The insurer may undertake to settle the repair bills directly with the garage or reimburse the insured.
Insurers would like to collect the damaged parts for which replacements have been allowed, as salvage. To ensure that replacements with new parts, have in fact, been effected.
In case of theft of the car or its accessories, it has to be reported to the police and final report should be submitted.
Household goods in transit
In case any damage is suspected in transit, open delivery should be insisted upon the carrier and their certificate should be obtained.
In case of loss/damage in transit, a monetary claim should be lodged with the carrier within the time limit to protect recovery rights, without which, the claim may not be admitted.
Mediclaim policy
Notice of claim should be lodged within 24 hours.
The insured should submit 'discharge summary' of the hospital/nursing home along with original hospital/medical bills, reports of the labs and investigation reports. In other words every item in the claim bill should be supported.
Overseas Mediclaim
The claim procedure varies from country to country and therefore the insured should get in touch with the overseas claim settling agents of the insurers immediately.
The Insured should carry the policy document with him, which may be produced as evidence if necessary. The policy document also contains the full information as to how to get in touch with the claim settling agents for assistance.
Personal Accident Claims
In case of accidental death, the capital sum is paid to the legal nominee of the insured. If the insured fails to provide the name of the nominee, succession certificate from a court of law is necessary.
In case of other claims, the insurers may get the insured examined by a specialist or refer the matter to medical board as is necessary, the cost of which will be borne by the insurers.
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