Why online term insurance claims got rejected?

Rajat bought up online term insurance plan from private insurer to cover the home loan. Rohit deposited the first premium, but unfortunately Rohit died in road accident. The insurance company rejected the claim, saying that Rajat had the past habit of consuming tobacco, alchohol etc. and thus the insurer repudiated the claim due to suppression of material fact at the time of taking out the policy.
Mahesh father died in year 2010, but the insurance company rejected the claim, saying he had not disclosed that he was suffering from blood pressure at the time of buying the policy in 2004.

These are some cases which insured are dealing every day. According to the Insurance Regulatory and Development Authority (IRDA), of the 7.62 lakh life insurance claims filed in 2009-10, nearly 15,000 were rejected by insurers. The rejection ratio (rejected claims as a percentage of the total claims received and pending during the year) of some companies, especially those which started operations a few years back are very high. Namely, Aegon Religare rejected 45% of the claims, Future Generali, IDBI Federal and DLF Pramerica rejected one of every fifth claim raised (20%) whereas LIC has a rejection ratio of 1.1%.

What are the main reasons of claim rejections?
1. Non discloser of details of existing and simultaneous policies from all insurance companies of the life to be insured
2. Non discloser of pre-existing disease of the life to be insured
3. Non discloser of Family History of the life to be insured
4. Non discloser of smoked or consumed tobacco products of the life to be insured
5. Non discloser Lifestyle Details of the life to be insured

Why it is important?
Insurance is a contract between the life insurer and the insured. This contract works on the principle of insurance – Utmost Good Faith – It states that insurance contract must be made in absolute good faith on the part of both the parties. The insured must give to the insurer complete, true and correct information about the subject matter of the insurance. So it’s your duty to give all the info whether it’s material or not.
It is important that you answer all questions truthfully and accurately and tell insurer about all relevant facts that could influence our assessment and acceptance of cover for you.
All the information provided by the life to be insured is assessed upon submission to the insurer, by that insurance provider’s underwriters on a case by case basis. Once assessed, one of a number of outcomes may result –
1. The application is accepted without exclusions
2. The application is accepted, but with exclusions on pre-existing conditions
3. The application is declined
Please note that any non-disclosure or misstatement or suppression of information with respect to the life to be assured has a direct impact on the claim’s decision. It may even lead to repudiation of the claim.

Important Points to mention in the Proposal
1. Do not hold back any information relating to your health and family (family means – parents / brothers / sisters / spouse & children) medical history.
2. Give details of existing and simultaneous policies from all insurance companies for the last 5 years.
3. Give details of current or past medical conditions, illness, diseases, disorders, disability surgery or treatment you are undergoing or are currently intending to seek any medical advice.
4. If have a option go for a medical test, a rigorous medical test actually helps the buyer. Because if a company gets the tests done, it rules out the chances of the claim being denied on account of pre-existing diseases.
5. Disclose facts like use of tobacco and alcohol consumption. #Tobacco product includes cigarettes, bidis, cigars chewable tobacco like gutka, flavoured pan masala, etc.
6. Lifestyle Details of the life to be insured – Current Usage/Past usage