Is war risk covered by life insurance? It's never too late to check the policy's fine print

Mint

23-06-2025

As the Iran–Israel war unfolds, it brings with it anxiety, headlines and human loss. For the world, it's a geopolitical crisis. But for thousands of Indian families, it's personal.
There are an estimated 18,000 to 20,000 Indian nationals living in Israel, including students, skilled professionals and technical workers. In addition, over 85,000 Jews of Indian origin call Israel home, many of whom still have family in India, making this not just an international crisis but an emotional one for the Indian diaspora.
One such tragedy struck recently. A young Indian engineer working in Tel Aviv was preparing to return home to Delhi. He had video-called his daughter and told her to finish her sign that read 'Welcome Home, Papa." The ticket was booked. The sweets were in the fridge. And then a missile struck. His name was among the casualties.
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The family's grief was instant, but what followed made it worse. When they reached out to the insurer, hoping for some support, they received a cold impersonal message: 'Claim denied under Clause XYZ—death due to war or war-like operations." There was no fraud. No error. Just a clause they had never paid attention to—one line buried in fine print that changed everything.
The fine print could write your family's future: In most life insurance policies, death due to war or war-like situations is not covered for civilians. These exclusions are clearly outlined in the policy document, often under 'General Exclusions.' While some insurers offer optional riders or policies that include limited war-related cover, many do not.
It is essential to understand what your policy excludes and not just what it promises. Unfortunately, many people skip this. According to the Insurance Regulatory and Development Authority's (IRDAI) 2024-25 annual report, one in four disputed life insurance claims were denied due to lack of awareness. These were not bad claims. They were uninformed ones.
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Insurance in India is stronger than ever but awareness must catch up: India's insurance ecosystem today is among the fastest evolving in the world thanks to IRDAI's progressive reforms. India reported a 98.6% claim settlement ratio in life insurance last year. It has introduced customer-friendly standard product structures, digitized initiatives like Bima Sugam and made disclosures and exclusions more transparent.
The system is getting smarter, faster and more accessible. But one thing remains unchanged: policies only cover what they are broadly understood to cover. As the annual report highlighted, many disputed claims were denied not because of fraud but because families misunderstood what was covered.
The rise of AI and disappearance of dialogue: Insurers today use artificial intelligence (AI) to streamline claims. Over 70% of global insurers now rely on algorithms to pre-screen documents and flag inconsistencies. It saves time. It filters fraud. But it also removes context.
An outdated address, an undisclosed travel history, a forgotten declaration from years ago: to a person, these are human oversights. To a machine, they are grounds for rejection. And often, families don't get to have a conversation. They get an automated message.
Claim readiness is the new insurance: Insurance isn't a file to keep in a drawer. It's the only document your family may reach when they can't reach you.
Being claim-ready means reading your policy thoroughly, especially the exclusions section; updating it when your life changes (job moves, international travel, new responsibilities); telling your family what to do and who to call; keeping both digital and physical copies safe and accessible; adding riders for special risks if your lifestyle or profession demands it. It's not paranoia. It's love translated into action.
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Ask these questions before it's too late: Instead of just 'How much insurance do I need?,' start asking the following. Will this policy protect my family if I die while working abroad? What happens if I'm in a country marked as a conflict zone? Are there riders available for such risks? Is there a manual review if AI rejects a claim? Will my nominee know what steps to take?
Sometimes, the difference between a denied claim and a fulfilled promise is just a single question asked in time.
Insurance is not about death; it's about continuation: If you're in your thirties or forties with children and/or ageing parents, or are working internationally, insurance isn't optional. It's foundational. But more than having it, you need to understand it. Choose policies that reflect your real life. Review them every year—don't set and forget. Speak to an advisor who listens, not just sells. And always, always read what seems 'small' because fine print often writes the biggest stories.
The final gift we leave behind: We cannot control when or how life ends. But we can control what remains. A sense of direction. A helping hand. A system that supports, not surprises. Insurance isn't a backup. It's a goodbye that says: 'I thought of everything—even this.'
So take a moment today. Read your policy. Ask uncomfortable questions. Because your family deserves more than a promise. They deserve certainty, not confusion. Compassion, not clauses. And support that doesn't disappear when they need it most.
The author is joint chairman and MD, BajajCapital.