The Term Insurance claim process can be understood in four simple stages:
Stage 1: Claim intimation – The nominee or eligible family member informs the insurer about the policyholder's death and initiates the claim.
Stage 2: Document submission – The nominee submits the required documents, such as the death certificate, policy details, identity proof, and bank details. Additional documents may be requested depending on the circumstances of the claim.
Stage 3: Claim assessment – The insurer reviews the submitted information and documents to assess the claim in line with the policy terms and applicable requirements.
Stage 4: Claim decision and payout – Once the assessment is complete, the insurer communicates its decision. If the claim is approved, the death benefit is paid to the nominee according to the policy terms.
Who should inform the insurer about a Term Insurance claim?
The nominee, blood relative, or another eligible family member can inform the insurer about the death of the life assured. Claim intimation should be made as soon as possible so that the insurer can begin the process. For a salaried employee, there is one practical step worth taking now: tell your nominee that you have Term Plan and where the policy records are stored.
What documents are needed to make a Term Insurance claim?
Common documents may include:
- Original policy document or policy details
- Death certificate issued by the relevant authority
- Nominee's identity and address proof
- Bank Account details or cancelled cheque for claim payment
- Claim form
- Medical records, where applicable
- Documents relating to the cause of death
- FIR, post-mortem report, or other investigation-related documents in cases of accidental or unnatural death
The insurer may ask for additional documents if they are required to assess the claim.
Why might an insurer ask a salaried employee for additional claim documents?
For a salaried employee, a Term Insurance claim may involve more than just the policy document and death certificate. The insurer may ask for additional documents to:
- Verify the circumstances of death: For instance, if the death was accidental, documents such as an FIR or post-mortem report may be required. In case of a medical death, relevant medical records may be requested.
- Confirm nominee's entitlement to the claim: This is why it helps to keep important employment, medical, and Insurance records organised and accessible to your family.
- Clarify information provided when the policy was purchased: If details in the claim documents differ from the information provided when the policy was purchased, the insurer may seek clarification or support records.
- Provide missing documents: If any required document is missing, incomplete or unclear, the insurer may ask the nominee to submit the relevant document or additional information.
How long does a Term Insurance claim settlement take?
The Insurance Regulatory and Development Authority of India (IRDAI) has set legally binding timelines for claim settlement.
For straightforward claims where all documents are in order, the insurer must settle the claim within 15 days of receiving the complete set of documents. That is the legal maximum for a simple, valid claim.
For cases where further investigation is required, perhaps for an accidental death or a claim involving overseas circumstances, the investigation must be completed and the claim resolved within 45 days of receiving the documents.
How can a salaried employee prepare their family for a Term Insurance claim?
Here are some simple steps that can prepare your family for a Term Insurance claim:
- Keep nominee details updated: Review the nominee information periodically, particularly after major life events such as marriage or the birth of a child.
- Review the policy periodically: Revisit your policy details when your income, liabilities, or financial responsibilities change to ensure the cover continues to reflect your family's needs.
- Separate personal and employer cover: Know how much cover comes from your employer and how much you hold independently, particularly when changing jobs.
- Inform your family about the policy: Make sure your nominee knows the insurer's name and is aware that the policy exists.
- Keep your contact details current: Ensure the insurer has your latest address, phone number, and email ID so that important policy-related communication reaches you.
- Understand the policy terms: Be familiar with the key exclusions, conditions, and payout structure so that you and your family have a clear understanding of the cover.
What should you tell your nominee before buying Term Insurance?
Your nominee does not need to become an insurance expert. They simply need to know the information below to take the first few steps:
- The name of the insurer
- Your policy number
- Where the policy document is stored
- Who the nominee is
- How to contact the insurer
- Where relevant financial records are maintained
What is a common mistake that can make a Term Insurance claim settlement difficult?
The most common practical mistake is not necessarily a complicated documentation error. It is that the family does not know a policy exists or cannot find the relevant records when they need them.
For salaried employees, insurance information can sometimes be spread across personal records, workplace benefits portals and email communications. It is therefore useful to keep personal term insurance documents separate from employer-provided benefits and make them easily accessible to the nominee or family.
How can you ensure a smoother claim process for the nominee?
To make the claim process smoother:
- Keep policy details accessible: Store the policy document, policy number, and premium records in a location the family can access.
- Make the nominee aware: Ensure the nominee knows about the policy and where its details are kept.
- Save insurer contact details: Keep the official claims contact information readily available.
- Keep documents updated: Review nominee details and other important policy information whenever there is a significant change in circumstances.
- Maintain relevant records: Keep important financial and supporting documents organised so they can be provided if required during the claim process.
How is a Term Insurance claim paid? Is the payout taxable?
Once a Term Insurance claim is approved, the death benefit is paid to the nominee or beneficiary either as a lumpsum or in instalments, as per the policy contract. The nominee should provide the insurer with the current bank details and any supporting documents. Keeping banking and identification details updated can help avoid unnecessary follow-ups.
The Term Insurance claim payout is exempt from income tax with no upper limit on the death benefit amount, under Section 11 read with Schedule II of Income-tax Act, 2025, previously Section 10(10D) of the Income-tax Act, 1961.
How can ABSLI help with the Term Insurance claim journey?
ABSLI provides multiple channels for claim intimation and submission, including its branches and claims section. As an ABSLI policyholder or nominee, you can access the following claims support:
If you are evaluating Term Insurance, you can also explore ABSLI Salaried Term Plan designed for salaried individuals, or ABSLI Super Term Plan and ABSLI DigiShield Plan, depending on your coverage requirements. The Claim Settlement Ratio along with the claim process must be evaluated before finalising the Term Plan. For FY2025-26, ABSLI reported a 98.86% claim settlement ratio for individual business.
Use the ABSLI Term Insurance calculator to estimate your premium based on factors such as your age, desired cover, policy term and other personal details.
September 15, 2026
6 mins read
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