Why Life Insurance Claims Rejected

Reasons Life Insurance Claims Get Rejected

Life insurance is designed to provide peace of mind and financial protection for your loved ones. But in South Africa, a growing number of life insurance claims are rejected each year due to avoidable reasons. Understanding why claims are declined — and how to prevent it — can help ensure your family gets the payout they deserve.

Why Life Insurance Claims Are Rejected

Insurers follow strict rules when assessing claims. If any of the following red flags arise, the claim may be denied:

1. Non-Disclosure of Medical Conditions

One of the most common reasons for claim rejections is failure to disclose pre-existing medical conditions. Whether it's high blood pressure, diabetes, or a history of smoking, insurers must be fully informed at the time of application. Withholding or forgetting to mention this can result in a declined payout.

2. Suicide Within the Waiting Period

Most life insurance policies in South Africa have a 24-month suicide exclusion period. If the insured dies by suicide during this time, the claim is likely to be rejected.

3. Missed Premium Payments

Missing monthly payments can lead to your policy lapsing. If your cover is inactive at the time of death, the insurer is not obligated to pay out the claim. Most companies allow a short grace period, but repeated missed payments may cancel your cover altogether.

4. Fraud or False Information

Providing false personal details, financial info, or medical records during the application process can void your policy. Insurers thoroughly investigate each claim, and any evidence of fraud will lead to rejection.

5. Death Outside Covered Events

Some policies only cover specific causes of death. For example, accidental death cover may not include illness, or travel exclusions might apply if the insured dies abroad. Always read your policy’s exclusions.

6. Death During Waiting Period

Most policies have an initial waiting period of 6–24 months, especially for natural causes. If the insured passes away within this period due to illness (not accident), the insurer may deny the claim.

How to Avoid Life Insurance Claim Rejection

• Disclose everything honestly — even minor health issues or habits.
• Pay premiums on time to keep your policy active.
• Review policy exclusions and waiting periods with your advisor.
• Inform your beneficiaries about your policy details and insurer contacts.
• Keep documents up to date — ID numbers, contact info, and beneficiary names.

Frequently Asked Questions

1. What happens if I forget to mention a medical condition?

If it's discovered after your death and it's material to the claim, your insurer may reject the payout. Full disclosure is essential during the application process.

2. Can I appeal a rejected life insurance claim?

Yes. You can lodge an appeal with the insurer and escalate it to the Ombudsman for Long-Term Insurance if needed.

3. Is missing one payment enough for cancellation?

Most insurers offer a grace period (typically 30 days). However, ongoing non-payment can result in policy lapse.

4. Does accidental death insurance include natural causes?

No. Accidental death cover usually excludes natural illnesses unless specified otherwise.

5. Can my family claim if I die abroad?

Some policies include international cover, but others may exclude deaths that occur outside South Africa. Always confirm this before travelling.

Protect Your Policy – Get Expert Life Cover Advice

Want to avoid claim issues later? Work with a trusted insurer and get life insurance that meets your family’s needs — with no hidden exclusions. Compare quotes and secure your future today.

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