5 Common Mistakes That Lead to Home Insurance Claim Rejections

• A home insurance claim may be rejected if the loss is not covered under the policy or if the policyholder does not follow the policy terms and conditions.
• Common home insurance claim mistakes include providing incorrect information, submitting incomplete documents and delaying claim intimation.
• Policyholders should understand their policy coverage and exclusions and regularly maintain their home to reduce the chances of claim-related issues.
• After an incident, promptly inform the insurer and relevant authorities, take reasonable steps to prevent further damage and preserve the damaged property for inspection.
• If a claim is rejected, policyholders should understand the reason, review their policy, provide any missing documents and raise a grievance if required.
• TATA AIG offers 24×7 customer care support during the house insurance policy claim process and allows policyholders to file claims online.

A home insurance claim rejection occurs when an insurer refuses to pay the claim compensation because it does not meet the policy terms and conditions. In simple words, the insurer can deny the claim if the policyholder makes mistakes in the claim process, such as providing incorrect information or documentation.

In such cases, the policyholder may have to bear the cost of repairing or replacing the damaged property or belongings out of pocket. This can create an additional financial burden. Therefore, it is important to carefully check all the details and documents before filing a home insurance claim.

Several reasons contribute to claim rejection in home insurance. Let us understand these reasons in detail.  

• 1. Not Understanding Policy Coverage and Exclusions One of the common home insurance claim mistakes is not understanding what is covered and what is not covered under the house insurance policy. The policy document clearly specifies the covered risks and may exclude certain types of damage. If you file a claim for an excluded event, then it can result in a claim rejection.

  For instance, suppose a policy clearly specifies that damage caused to the house due to normal wear and tear is not covered. Then a homeowner cannot claim compensation for repairs needed due to the property's natural ageing.  

• 2. Failing to Provide Proper Documentation Providing necessary documentation is a critical aspect of the home insurance claim process. Missing, incomplete or incorrect documents can not only delay the claim process but also lead to a home insurance claim denied decision.

  For instance, a homeowner has filed a claim for damaged household appliances under the policy. However, at the time of filing a claim, they fail to provide the purchase invoice or other requested documents. Then this makes it difficult for the insurer to verify the claim and it can lead to claim rejection.  

• 3. Hiding or Providing Incorrect Information Another common reason for home insurance claim rejection is providing false, incorrect and incomplete information while buying the policy. After submitting the claim, the insurer verifies the claim assessment, and if the details do not match the actual situation, they can reject the claim.

  For example, a homeowner has declared that the property is used for residential purposes while purchasing the policy but actually uses it for commercial activities. If this difference is discovered during claim assessment, it may affect the claim settlement or lead to claim rejection, depending on the policy terms and conditions.  

• 4. Delayed Claim Intimation Another essential aspect of the house insurance policy is notifying the insurer about the damage and loss within a specified time frame. Delaying the claim without a valid reason can make it difficult to assess the damage and may affect the claim.

  For instance, if a pipe bursts and causes significant damage to the house, the homeowner should promptly inform the insurer and take reasonable steps to prevent further damage. Waiting for several weeks before reporting the incident can make it difficult to determine the extent and cause of the loss.  

• 5. Overlooking Preventing Measures Policyholders are generally expected to take preventive measures to avoid further damage and loss to the property. Failing to take preventive measures or ignoring known risks may affect the claim process.

  For example, if a fire breaks out in a home, the homeowner should immediately inform the fire department and, if it is safe to do so, switch off the main electrical supply to help prevent further damage and loss.

Policyholders can reduce the chance of claim rejection in a home insurance policy by following the necessary steps. Here are some measures policyholders can take before and after the incident happens:  

• Before an Incident Happens
• Disclose Correct Information: Policyholders need to disclose the correct information about the property and its contents, such as property location, household content value, safety devices installed, etc., at the time of buying the plan.
• Understand Policy Coverage and Exclusions: Read the policy documents carefully to know what is covered, the applicable limits and the situations that are excluded. This will help in avoiding filing claims for situations that are not covered.
• Keep Up with House Maintenance: Regularly maintain the property and address issues such as leaking pipes, damaged electrical wiring or a weak roof. Timely maintenance can help prevent small problems from turning into major losses.
• After an Incident Happens
• Notify Insurer and Authorities Promptly: After the incident, notify the insurer and relevant authorities within the specified timeframe. For example, in case of a fire, contact the fire department and follow the insurer's claim intimation process.
• Take Necessary Preventive Steps: Policyholders should take all reasonable steps to prevent further loss or damage to the insured home and its contents after an incident. They should also preserve the damaged items for inspection and avoid cleaning, disposing of or repairing them unless it is urgently necessary or the insurer cannot be contacted.
• Submit Correct Documentation: Provide the required documents, photographs, bills and other information accurately while filing the claim. Keep copies of the submitted documents for your records.

If a house insurance policy claim has been rejected or denied by the insurer, then the policyholder can follow these necessary steps:  

• Understand the Reason for Rejection: Check the claim rejection letter or communicate with the insurer to understand why the claim was rejected.
• Review Your Policy Coverage: Go through the policy terms and conditions to check whether the loss or damage is covered.
• Provide Missed Documents: If the claim was rejected due to missing or incorrect documents, submit the required documents or clarification to the insurer.
• Raise a Grievance: If you believe the claim was wrongly rejected, raise a complaint with the insurer's grievance redressal team and provide the relevant supporting documents.
• Approach the Ombudsman: If the issue remains unresolved after approaching the insurer, the policyholder can consider approaching the Insurance Ombudsman as per the applicable rules.

Filing a successful house insurance claim is a straightforward process. You just need to follow the below-mentioned steps:  

• Inform the Insurer Representative: After the damage or loss, you need to inform the TATA AIG representative by calling 022-6489-8282 (helpline number).
• Notify the Relevant Authorities: Report the incident to the appropriate authorities. For example, inform the police in case of theft or the local fire brigade in case of fire.
• Prevent Further Loss or Damage: Take reasonable and necessary steps to prevent further loss or damage to your home or its contents.
• Cooperate with the Surveyor: A surveyor may visit your home to inspect the affected property and assess the extent of the loss or damage. Provide the required information and cooperate during the inspection.
• Submit the Claim Form and Other Documents: Submit the duly filled claim form along with the required documents within 30 days from the date of loss or damage.

Understanding the reason for claim rejection in a house insurance policy can help policyholders avoid common mistakes while filing a claim. By clearly understanding the claim terms and conditions and following the correct steps, you can make the claim process smoother.   TATA AIG offers customised home insurance plans that are designed based on your home insurance needs. For instance, under the Bharat Griha Raksha Plan, the policy also offers a waiver of underinsurance, subject to the applicable terms and conditions.   This can provide added financial protection by reducing the impact of underinsurance when you make an eligible claim. Whether you buy housing society insurance or building insurance, you will get 24×7 customer care support during the claim process.   Our representatives can provide the necessary assistance and help you understand the claim process when you need it the most. Along with this, you can also file a claim online from the comfort of your home.   Secure your home and its contents with the best home insurance plan offered by TATA AIG!