Insurance Companies Are Smarter Than You Think

Things were going fantastic for 38-year-old Praveen Shukla for a long time. With an enviable corporate career, great family and a fantastic house at a prime location, he had it all. When someone suggested he buy a health policy to safeguard any unforeseen medical mishap, the chain smoker father of two, decide to skip what he termed ‘a minute detail.’ Two years after buying a medical cover, when cancer struck, Shukla got another rude shock. His insurance company denied him his claim stating that he had failed to disclose that he was a smoker. Shukla had no choice but to sell off his house and somehow managed to cover his medical costs. Today, after almost a full recovery, he advises everyone that crucial details should not be skipped in favour of getting a lower premium.  Because then, the price that you pay is very high.

In today’s world, whether you are a youngster at the threshold of a career or a seasoned career professional, buying an insurancepolicy has become a need of the hour. Whether you opt for a health or life insurance policy if you decide to withhold facts or simply fudge them for a bigger gain, there are high chances that your insurance company will get the better of you. This is because insurance companies have their own ways of unearthing the ‘truth’ of their policy holder if they get suspicious. Also, the principle of “utmost good faith” comes into the picture, where both parties to the insurance contract is obligated to disclose any material facts pertaining to the policy. A failure to do so leaves the policy null and void, therefore the insurance company can deny to pay in event of a claim.

These days, a lot of insurance companies are tying up with detective agencies to uncover and ascertain facts about their policy holders. For example, in Shukla’s case what probably let the cat out of the bag was the fact that the medical reports submitted by him were vetted by a team of medical-legal experts who probably raised some questions. Though his bloodstream may have been clear, Shukla’s lung x-rays probably painted a different picture, altogether. Many insurance companies employ such experts to sniff out if anything is wrong.

Also, even if the policy holder has passed away, detectives can be hired to authenticate his medical condition. These investigators collect records or information from the medical stores/chemists within the vicinity of the deceased’s residence, alongwith hospital records which may be corroborated with information from relatives,  neighbours or even the neighborhood nursing home where the policy holder may have undergone treatment. Claims are then settled or rejected after gathering all this information. Especially in cases where the sum assured is a large amount.

Even if you fill your policy documents erroneously or withhold information then you’re definitely giving your insurance company a chance to smell a rat. So, it may be a good idea to look before you leap because someone out there is definitely watching.