In term insurance, after the death of the person taking the policy, his family members get the amount of insurance. Term plans are taken by people thinking that after their death, there should be no financial trouble on the family members.
But, many people do not know that in case of death, the sum insured is not available to the family members. Here we are going to tell you about such things in which situations your claim can be rejected.
Term plan is the right product for life insurance. In this, no amount is received at the time of maturity. The policyholder pays the premium for a pre-determined period and if he dies during this period, his nominee or family members get the policy amount. But, in some situations this amount is not available.
involvement in criminal activity
The insurance company can deny compensation in case the policyholder is killed and the role of the nominee is revealed. You will not get the sum insured if the policyholder is involved in any criminal activity and is killed.
death by drinking
If the policyholder is drunk or has taken drugs, then in case of his death, the insurance company can refuse payment of term plan compensation. In reality, the insurance company does not give a policy to those who drink more alcohol.
If you smoke and have not informed the insurance company while taking term insurance, then the claim of compensation can be rejected. A person who smokes has more health problems. The insurance company charges a higher premium for giving an insurance policy to such a person.
players of danger
If you love dangers then term insurance is not for you. In case of death due to participation in any adventure or dangerous nature, the claim of compensation can be rejected by the insurance company. Car or bike race, sky diving, para gliding etc. come under the category of risky sports.
cause of death due to any chronic disease
If you have not informed the insurance company about any of your chronic diseases while taking term insurance and due to this, in case of death, the insurance company can refuse to pay you the compensation of the term plan. Death due to various reasons is not covered in a regular term plan. These include STDs and HIV AIDS etc.
Certified Financial Planner Vijay Shah says that you should not hide anything from the insurance company while taking a term plan. Because your family members may have to bear the brunt of this. Apart from this, if the policyholder commits suicide in the first year of the policy, then the insurance company can reject the claim of compensation.