Why insurers investigate death claims in the first years of a policy

For three years after the latest of a life policy's issue, risk-start, revival or rider date, the insurer can still question the policy for fraud or a material misstatement, which helps explain why claims in that period get a closer look. IRDAI's 2024 master circular gives it 45 days from intimation to finish the investigation and settle such a claim. A refusal must rest on legally tenable evidence, with the grounds and materials given to the family in writing.

An investigation is not an accusation. It is the insurer checking, before it pays, whether the policy can still be questioned — and in the early years the law says it can.^[1]

Why the early years are different

Section 45 of the Insurance Act lets an insurer question a life policy for fraud, or for a material misstatement in the proposal, only within three years of the latest of the issue, risk-start, revival or rider date. After that, it cannot question the policy on any ground. This helps explain why an early claim gets a closer look: it is the only period in which the policy can be questioned for what the proposal said.^[1]

An insurer's own claim requirements can say so. LIC, for example, asks claimants to contact the servicing branch for additional requirements if death occurs within three years of the date of risk or of revival.^[2]

How long the investigation can take

IRDAI's 2024 master circular gives a death claim that warrants investigation 45 days from the date of intimation, and that period covers both the investigation and the payment. The circular does not define which claims warrant investigation. If the claim is not settled in time, interest at the bank rate plus 2% runs from the date of intimation, and the insurer should pay it without being asked.^[3]

What the review compares

Because the grounds open in this period are fraud and material misstatement, the comparison that matters is between what was stated in the proposal form — or in the document on which the policy was revived or a rider issued — and the medical and other records from before that date.^[1]

What the family can do while it runs

1. 1

   Answer requests in writing.

   Reply by letter or email and keep copies. The 2024 Regulations require insurers to ask for all the documents the policy lists at one go, not piece by piece.^[4]

2. 2

   Note the date you intimated the claim.

   The 45 days are counted from that date. Put the end date in your calendar.^[3]

3. 3

   Read before you sign.

   If an investigator asks you to sign a statement, read it fully, correct anything that is not what you said, and ask for a copy.

4. 4

   Ask for reasons in writing if the claim is refused.

   IRDAI's circular says a claim cannot be repudiated without legally tenable evidence, and within the three-year period Section 45 requires the grounds and materials to be given in writing.^{[3, 1]}

5. 5

   Escalate a delay.

   If the 45 days pass, write to the insurer's grievance officer; it should resolve a complaint within 14 days. Life claim delays covers the next steps.^[3]

ClaimAssure is an independent private platform. It is not an insurer, IRDAI, Bima Bharosa or the Insurance Ombudsman, it never files anything on your behalf, and it cannot promise any outcome. What it does is read your documents and show you what they say.

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