The news of the loss of life at the Bangalore stampede has shocked the nation. Here we will look at how a stampede is treated in life insurance. Standard term insurance policies cover deaths from stampedes, treating them as unexpected and accidental deaths. Recent tragedies at public events have raised questions about these risks, prompting insurers to explain their coverage rules.
"The death due to a stampede is generally considered accidental by most insurers in India, and the claims are paid under the standard term policy, unless the policy terms and conditions explicitly exclude the incident. But policyholders need to make sure their policy is still active and that the death didn't happen because of illegal activities or breaking policy terms," says Aditya Mall, appointed actuary, Future Generali India Life Insurance.
As more people attend religious and cultural events, insurance companies are taking another look at their risk factors, but coverage for stampedes still falls under the usual accidental death clauses.
What Is Excluded
While term plans provide coverage for accidental death, there are some exclusions:
Engagement In Criminal Activities: If accidental death happens while the policyholder is engaged in illegal activities, the insurer may deny the claim."
Criminal Or Reckless Acts: "Death caused by the policyholder's criminal acts or reckless acts may also be denied. For example, the recent stampede in Bengaluru, even if it is found that a person died when they tried to scale the wall to get into the stadium illegally, will allow the electronic insurer to dispute the accident and the claim," says Pankaj Nawani, CEO, CarePal Secure.
"Claims could be denied for a death that occurred during unlawful activity, a brawl, or where the individual was intoxicated or under the influence of drugs. Look closely for any rider exceptions in the fine print regarding "unlawful activity," or "civil unrest" in the fine print," says Kunal Varma, Founder and CEO, Freo.
Pre-existing Ailments: If the death is caused by pre-existing ailments that were not disclosed, the insurer could essentially claim the death didn't take place because of the accident, but rather the underlying health conditions. "Again, using the example from yesterday, if death occurred due to a heart condition that was not disclosed at the time of taking the policy, the insurer may contest the claim," says Nawani.
Procedure To Be Followed
In case of a stampede-related death, a family claiming term insurance benefits needs to submit a death certificate along with a police report or FIR confirming the death and the reasons surrounding it. When multiple fatalities occur simultaneously, several autopsies may need to be conducted. If an individual passes away at a big event or gathering, news stories or official statements can back up the claim. "Sometimes, insurance companies might ask for hospital records if the person got medical help before their death. Submitting all required documentation promptly plays a crucial role in ensuring a smooth and timely claims process," says Mall.
