Claims Management and Settlement
Domain 6 follows a claim from intimation to payment or repudiation. The exam tests documentation, surveyor involvement, claim calculation and the difference between life and non-life claims.
Core rules
- A claim begins with intimation and registration, followed by submission of documents: claim form, policy copy, identity and proof of loss.
- Non-life insurers may appoint a surveyor/loss assessor for material losses; the surveyor reports on cause and quantum, but the insurer decides the claim.
- Life claims require death certificate, claim form and nominee/legal evidence; early claims are scrutinised for non-disclosure, subject to Section 45 of the Insurance Act, 1938.
- Health claims may be cashless through a TPA or reimbursement-based, subject to waiting periods, sub-limits and exclusions.
- Motor claims involve survey, repair estimates, depreciation on parts, deductibles and salvage. After indemnity payment, subrogation may give the insurer recovery rights.
Worked example
A motor own-damage repair bill is ₹80,000. The policy has a ₹2,000 deductible, and plastic parts worth ₹20,000 attract 10% depreciation. Depreciation = 0.10 × 20,000 = ₹2,000. Payable = 80,000 − 2,000 − 2,000 = ₹76,000, subject to the IDV. Reasoning: the insured bears the deductible and the depreciation; the insurer pays the balance of the admissible loss.
Traps that cost marks
- Ignoring the deductible and depreciation.
- Treating a surveyor’s report as the final decision.
- Forgetting salvage value in a total-loss claim.
- Missing the Section 45 limit in early death claims.