Claims are an integral part of insurance business. Claims are paid out of the insurance fund of the insurers. Insurance fund is a pool to which the members of the insuring public contribute by way of premium and from which the losses suffered by a few are indemnified.
While dealing with claim, the insurers have to discharge a three-fold obligation as follows:
In order to fulfill the above obligations, the insurers usually incorporate conditions and warranties in the policy which stipulate the duties to be performed by the insured in the event of a loss.
The insured has to give a written notice to the insurers, immediately after happening of any claim.
The insured has to follow up the notice with full details of the claim within the time limit prescribed by the policy.
The insured has to give to the insurers all such information and assistance as the insurers may reasonably require.
Every correspondence with concerned has to be forwarded to the insurers immediately on receipt by the insured.
The insured has to lodge immediately a complaint with the policy, if applicable.
The insured cannot make or give any admission, offer, promise, payment or indemnity likely to affect the insurers without the written consent of the insurers.