How To Make an Insurance Claim

Picture this: after a life-altering event, you’re overwhelmed with the emotional aftermath and now face the daunting task of managing an insurance claim. The paperwork piles up, deadlines loom, and you are overwhelmed. It feels like you’re caught in a maze of bureaucracy, and you’re left wondering if the compensation you desperately need will ever arrive, adding stress to an already difficult situation.”

If you are a novice, making an insurance claim can be overwhelming, whether it’s a sudden illness, an accident, or a natural disaster. However, you can ensure a smooth and successful outcome with the proper guidance.

By understanding the insurance claims process, you can significantly reduce the stress and uncertainty associated with making a claim, allowing you to focus on rebuilding your life.

Understanding Your Insurance Policy

Insurance policies, while complex, can be navigated with confidence when you thoroughly understand the details of your insurance cover before making a claim. Here are the key aspects to be aware of:

Coverage Details

Your policy will outline the specific events. Depending on the type of insurance, this may include coverage for death, injury, or illness. Ensure you understand exactly what your insurance policy covers. 

Exclusions 

All insurance policies have exclusions – events or circumstances that are not covered. Common exclusions include pregnancy or pre-existing conditions. Review the exclusions of your policy carefully to avoid any surprises if you need to make a claim. 

Claims Process

The policy will explain the steps needed to file a claim, such as notifying the insurer promptly and providing supporting documentation. It will also detail how claims are settled, for example, via lump sum or instalments.

Responsibilities

Your insurance policy outlines your obligations as the policyholder to ensure your coverage remains valid, such as paying premiums on time and updating the insurer of any changes. 

Reviewing your insurance policies regularly, especially when your circumstances change, is vital to ensure you have the right coverage and help you avoid being underinsured or facing unexpected exclusions if you need to make a claim. Acquiring the expertise of an experienced financial adviser can be beneficial.

Regulation

The Australian Prudential Regulation Authority (APRA) regulates the insurance industry, ensuring that insurers remain financially stable and are able to keep the financial promises they make to their policyholders. APRA monitors insurers using a number of rules, including the Financial Services Council’s Life Insurance Code of Practice, which outlines the timeframes for initial decisions on claims.

The Insurance Council of Australia (ICA) is the representative body of the general insurance industry in Australia. This includes overseeing the General Insurance Code of Practice, which mandates insurers to provide an advance payment within five days of a person demonstrating financial need.

So how do you make an insurance claim to ensure a smooth and successful outcome?

Regardless of the type of insurance, the claims process generally involves the following steps:

1. Contact Your Insurance Provider

The first step is to contact your insurance provider to initiate the claims process. It’s important to do this as soon as possible, as many insurers have time limits for reporting claims.

When contacting your insurer, be prepared to provide the following information:

• Your policy number.
• Reason for claim including date of incident.
• You won’t need to give all of the details of the claim upfront. You will be issued with claim forms to complete for this stage of the process.

Effective communication with your insurer is key. Even though it may feel confronting, it’s important to take your time, be patient and provide all the information they request. If you’re unsure about any aspect of the claims process, don’t hesitate to ask for clarification.

2. Gather Necessary Documentation

When making an insurance claim, it’s crucial to have all the required documentation ready to support your case. The specific documents needed will vary depending on the type of insurance and the nature of the claim, but will typically include:

• Claim forms.
• Medical reports and records.
• Proof of current income.
• Your insurance policy documents.

Note that all information requested by the insurer must be provided promptly. Thus, keeping these documents organised and easily accessible will help ensure a smooth claims process.

3. Complete Your Claim Form

Once you’ve initiated the claims process, your insurer will ask for you to complete your claim form and gather all the necessary information about your claim. When filling out the claim form, be sure to:

• Read the instructions carefully and follow them precisely.
• Provide accurate and detailed information about the incident or loss.
• Double-check all the details before submitting the form.
• Attach all the required supporting documentation.

Attention to detail is crucial at this stage, as any mistakes or omissions could delay the processing of your claim.

4. Follow-Up on Your Claim

After submitting your insurance claim, it’s important to follow up regularly to ensure it’s progressing smoothly. This involves:

• Contacting your insurer to check on the status of your claim.
• Providing any additional information or documentation they may request.
• Addressing any delays or issues that arise in a timely manner.

Possible Claim Outcomes

An insurance claim can have several possible outcomes, each with its own set of implications and next steps. Understanding these outcomes can help policyholders better navigate the claims process and ensure they receive the best possible outcome.

Approval

If a claim is approved, the insurance company will provide the policyholder with the agreed-upon payment. This outcome is typically the result of a thorough investigation and evaluation of the claim, ensuring that the policyholder has met the necessary requirements and the loss is covered under the policy.

On Hold

In some cases, a claim may be put on hold until the policyholder has fully met the requirements for the claim and the insurance company cannot process the claim any further. This can be rectified by providing the insurance company with the additional information required.

Denial

If a claim is denied, the insurance company does not agree to provide any compensation for the loss. This outcome can occur if the policyholder has not met the necessary requirements for the claim if the loss is not covered under the policy, or if there is evidence of fraud or misrepresentation.

Reasons for Each Outcome

The reasons for each outcome can vary depending on the specific circumstances of the claim. However, common reasons for denial or partial approval include:

Insufficient Documentation: Failure to provide adequate evidence or supporting documents for the claim.

Policy Exclusions: The loss is not covered under the policy due to specific exclusions or limitations.

Fraud or Misrepresentation: Evidence of intentional deception or misrepresentation in the claim.

Insufficient Coverage: The policy does not provide sufficient coverage for the loss or damage.

Steps to Take

If a claim is denied, policyholders can:

Review the Decision: Carefully review the insurance company’s decision and understand the reasons for denial or partial approval.

Appeal the Decision: If you are not satisfied with the outcome ask for an internal review, or you can make a complaint with the Australian Financial Complaints Authority (AFCA).

Seek Professional Help: Consult with a Wealth Protection Adviser who is highly experienced in insurance and can help navigate the appeals process and ensure the best possible outcome.

Tips for a Smooth Claims Process

When dealing with an insurance claim, following a few key steps can help ensure a smooth and successful outcome. Here are some expert tips for Australian policyholders:

Gather and Organise Documentation

Maintain a well-organised file containing all relevant documents related to your insurance policy and the claim itself. This includes your policy documents, tax records, medical reports, and any other supporting evidence. 

Communicate Effectively with Your Insurer

Be honest, transparent, and responsive in your communications with the insurance provider. Promptly provide any additional information or documentation they request. Ensure a primary point of contact is designated to you to streamline the process. 

Understand Your Policy Coverage

Familiarise yourself with the terms, conditions, and exclusions of your insurance policy – usually found in your Policy Documents and the policy’s Product Disclosure Statement. This will help you understand what is and isn’t covered, setting appropriate expectations for the claims process. 

Be Persistent and Patient

The claims process can sometimes be lengthy and frustrating. Remain persistent in following up with your insurer, but also be patient as they work to assess and process your claim.

Seek Professional Assistance if Needed

For complex or contentious claims, consider consulting a Wealth Protection Adviser. They can provide guidance, negotiate with the insurer on your behalf, and help to fight for your full entitlement under your policy.  

The Bottom Line

Making an insurance claim can be a daunting task, but being well prepared and proactive can significantly improve the outcome. 

This article has outlined the key steps to follow when making an insurance claim, including contacting your insurer, gathering the necessary documentation, contacting your insurer, filling out the claim form, and following up on your claim. 

By following these tips and utilising the resources available to Australian policyholders, you can navigate the insurance claim process with confidence and increase your probability of a successful outcome.

If you need assistance with a claim or have any questions, consider consulting an experienced Wealth Protection Adviser. They can provide guidance, negotiate with the insurer on your behalf, and help ensure you receive the full entitlement under your policy.

Protect Yourself and Your Loved Ones with Newcastle Financial Planning Group 

Life insurance is an important investment to protect the financial security of you and your loved ones in the face of unexpected events. By understanding how your personal insurance impacts your future, you can make informed decisions when choosing the best policies and coverage for your needs.  

Seeking the advice of an experienced Wealth Protection Adviser who specialises in insurance can make it easier for you to find the most comprehensive and cost-effective options. 

Do you need specialist insurance advice from a professional Wealth Protection Adviser? Newcastle Financial Planning Group is here to help you.  

Call us or book online to secure your initial meeting with us today and get started! 

References:
https://insurancecouncil.com.au/

https://www.afca.org.au

https://www.choosi.com.au/life-insurance/articles/making-a-life-insurance-claim

https://www.qbe.com/au/news/helpful-tips-for-the-claims-process

https://www.honan.com.au/news/navigating-insurance-claims-a-beginners-guidew