Buy With Care: Some Dos and Don'ts - Policy Holder
Buy With Care: Some Dos and Don'ts
You buy insurance for security. So be extra careful when you buy it. It is worth taking care of a few crucial aspects during this process.
Mis-selling by insurers and their intermediaries is something you have to be cautious about. IRDAI keeps a tab on unethical practices by entities selling insurance based on unfounded promises.
Your insurance company and intermediary have to act according to the Code of Conduct prescribed by IRDAI, the industry councils and the relevant recognized professional association.
In respect of Life Insurance policy, usually a verification call is made by the Life Insurer either prior to/after delivery of policy bond to ascertain whether you have understood T&Cs of the policy purchased.Ensure that you answer the Insurer only after going through the policy document and do not solely reply upon the promises made by the Intermediary/Sales person.
Here are some Dos and Don’ts for buying insurance carefully:
1. Buy only from a registered insurer or through his authorized intermediary
2. See the list of insurers on IRDAI's website. Ask them if your intermediary is genuine
3. Ask the intermediary for all information to make a decision
4. Evaluate if he is advising you dispassionately
5. Fill the proposal form yourself and give complete and factual information; False or misleading information could lead to disputes at the time of a claim
6. Do not sign a blank proposal form or leave any portion unanswered
7. If you are not filling it up yourself, ensure that the contents are fully explained to you
8. Remember you have to sign a certificate as part of the proposal form taking responsibility for its contents
9. Make sure you understand clearly:
Whether your policy has a single premium or regular premium
What your policy term and premium paying term are. They can be different
What your surrender value is. It can be less than the premiums you have paid
What is covered and what is not covered
Understand the returns and bonuses, what is guaranteed and what is not
10. In the case of Unit-Linked insurance policies (ULIPs):
Make sure you understand the implications of bearing the investment risk yourself
Evaluate the performance of the funds before you invest
Understand the various charges levied under the policy
11. When you receive the policy bond:
Make sure it matches the terms proposed/ agreed by you
If they don’t, you can cancel Life, Individual Health Insurance (tenure not less than one year) policies during the 15 day "free-look" period from the date you receive the policy bond. However, if the Life Insurance policy is an electronic policy/purchased through Distance Mode, you can cancel it within 30 days of receiving the policy bond. (in respect of other policies, cancellation will be subject to the T&Cs of the policy).
Premium will be refunded to you with some deductions
1. Do not sign a blank proposal form or leave any portion unanswered
2. Do not conceal relevant information or make any misstatements as it may lead to disputes at the time of a claim
3. Do not fall prey to the spurious calls done in the name of IRDAI/Other governmental organizations