Travel insurance is a great way to protect inconveniences and risks when travelling. In return for a nominal amount, the insurance company offers to cover major hazards for the entire journey. It gives you the confidence to carry on with the itinerary without having to worry about monetary or administrative implications in case of an unforeseen event.
Some of the most commonly covered aspects of travel under this insurance are delay/cancellation of flight, loss/stolen baggage, medical emergencies, death amongst a few. Its quite easy to sign up for it since most of the companies operating in the general insurance segment in the country offer cover for travel. One can also watch out for travel insurance provided on credit cards where the policy gets activated upon charging travel related expenses such as flight tickets to the card in question.
While we hope the need to use the benefits never arises, you should be aware of the typical claims process to be well equipped if a claim situation is encountered. To begin with, let us revisit the “Claims Process” followed by common reasons for claim rejections.
Typically, a claims process begins after you report the incident to the insurer. The claimant must not delay in reporting the incident as soon as it occurs since delay in doing so can result in rejection or hinderence in processing. A typical claims process works in the following steps.
- Call the claims center to register the claim with details of nature of claim (Eg: baggage lost, medical reimbursement etc.).
- Fill the claim form (available on the website of the insurer/at the nearest office) with complete details.
- Submit the claim form along with with relevant ID and supporting documents such as flight tickets, boarding passes to the designated office.
- Wait for the claims representative to come back to you with an update as per the TAT (Turn around time). Follow up at regular intervals if you do not get an update.
- If approved, the insurer will contact you for confirmation.
- If rejected, you will have an opportunity to escalate further to an appellate authority.
Well, that is more or less how the claims process is administered by an insurer who offers Travel Insurance.
Reasons for Denying Claims
The reasons for rejections for travel insurance claims are quite a few. Lets look at some of the most common reasons.
Negligence: If the incident in question is a direct result of your negligence/carelessness, chances are that your claims will not be approved no matter how big the loss it. Let's say, you probably failed to check in on time due to which the flight was missed, the compensation will not be approved. Along with verifying the documents you’ve submitted in this regard, insurers go to the extent of validating your stance with the airline or airport authorities as a part of their investigation.
Improper Paperwork: The claim form you filled containing inappropriate data or supporting documents not being in place can lead to rejection of the claim. The paperwork should be in compliance with internal standards and also legal regulations in this regard. Slight deviation or deliberate submission of incorrect documents will kill the deal.
Incident not included: Policy exclusions are another major reason why claims get rejected outright. Let's say, loss of personal baggage is not covered and you lodge a claim in this regard, it will not be entertained. Be sure to understand inclusions and exclusions and make an appropriate claim. You don’t want to invest time and resources to claim something that was never a part.
Claiming for events prior to activation: Travel insurance is best purchased as soon as the travel tickets are booked. Only claims made after activation of the policy is entertained. If you’re making retrospective claims for events that occurred before the policy came into being, they will not approve. Therefore, verify the cover activation date and ensure the entire itinerary is covered before making a claim.
Failure to claim within the stipulated time: If the claim is not recorded within the stipulated time, they will reject. It's important to read the clauses in this regard and claim within the specified time. The sooner you report it, chances of approval is high.
Deceptive claims: If the claimant submits forged documents with an intention to make a mala fide claim, it will be rejected and chances are that such claimants may even be subject to legal proceedings.
Precautions You Can Take to Prevent Claim Rejection
Well, most the reasons for rejections can be easily prevented if we exercise caution and follow the procedure. After all, it's a policy we’ve paid for and seldom do we want to be denied of our right. Lets look at some of the underlying elements of how we can prevent.
Check the Claims Settlement Ratio
Before signing up for a travel insurance, use online and offline resources to ascertain the claims settlement ratio of the insurer to understand the likeliness of your claim being honoured in the future. It's a ratio of the number of claims a company received during a period versus how many were successfully settled.
Understand the Policy & Clauses
It's paramount to understand the policy and its benefits before signing up. Give it a 360° view before buying one. It's safer to have read and purchased the most suitable one rather than regretting later for being denied for making a legitimate claim.
Understand the Terms & Conditions
After receiving the policy, spend some time in reading and understanding the fine print to help you prepare in case of a claim. If there something that you did not understand, get if clarified by contacting the insurance company.
Follow the Procedure
Its very important to follow the claims procedure prescribed. Needless to say, it may go against you lodge a claim. The claims procedure is generally provided in the policy document and the same can be obtained on the official website of the insurer.