Question

What action should a life insurance company take if a claim is ready for payment but cannot be made due to identification issues?

a.

Deny the claim

b.

Hold the amount for the benefit of the payee and pay interest on it

c.

Initiate legal proceedings against the claimant

d.

Investigate further before making any decision

Posted under IC 14 Regulations of Insurance Business

Answer: (b).Hold the amount for the benefit of the payee and pay interest on it Explanation:If a claim is ready for payment but cannot be processed due to identification issues, the insurance company should act responsibly by safeguarding the funds for the rightful payee. Holding the amount for the payee's benefit and paying interest on it demonstrates the insurer's commitment to fair and transparent claim settlement practices.

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Q. What action should a life insurance company take if a claim is ready for payment but cannot be made due to identification issues?
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