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Know Your Rights When You Buy Insurance

Before buying a life insurance policy it is important to know your rights regarding the policy that you wish to avail. This will help you take the insurer to task if you feel you are being taken advantage of.
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The importance of getting insured is something which a majority of people are aware of, these days. As is the norm, when purchasing a life insurance policy, buyers primarily focus on choosing a policy which fulfils their requirements. What many insurance buyers are simply not aware of, are, their rights and privileges before and after having purchased an insurance policy. Insurance is essentially a contract between the insurer and the insured wherein the former will provide life cover to the latter in exchange for regular premiums. Considering this, every policyholder is entitled to certain rights with respect to their insurance policy and claim settlement. Read on to know more about your rights as an insurance policyholder.

Right To Information - Before Policy Purchase:

Before you purchase a particular policy from an insurer, you have the right to know all about the policy. Ask to be told about the finer details of the plan like waiting period, grace period for premium payment, free look period within which you can return the policy, what the claim settlement process involved, who can you approach if the insurer is not updating you on the claim status, what are the premiums which you have to pay, what can you do if your claim settlement process has stretched beyond a the specified duration promised by the insurer, the insurer’s claim settlement ratio, etc. If you are committing to pay the premiums towards a policy, it is your right to know all these aspects, which are extremely important.

Rights When Applying For The Policy:

If a customer has applied for a policy, the insurance company is required to update them on the status of their application (approval or rejection) within a period of not more than 15 days. Following this, in case the application has been approved, the insurer must ensure that the policy document reaches the policyholder within a duration of 30 days.

In case the policyholder is taking the services of an insurance agent associated to a company, and they feel that the agent might be unduly pressurizing them into purchasing a specific policy or being vague in providing information about other policies, they can report the same to the concerned authority of the company itself. Also, it is the customer’s right to safeguard their confidential information. As per stated rules, insurance companies may only ask the policyholder for information which is required for approval or rejection of the application, and nothing beyond. It is also the insurer’s responsibility to ensure that the data provided by the policyholder stays confidential and is not shared or leaked.

Right to Information Regarding The Policy:

To protect the interests of the policyholders, IRDAI (Insurance Regulatory & Development Authority of India) has laid down guidelines under which an insurance provider is required to communicate all policy related information to a policyholder, without fail. Policyholders are well within the scope of their rights to enquire about all aspects and details of a particular policy, which they may be planning to purchase.

As per rules, the insurance provider is required to provide the policyholder with a form wherein the latter is supposed to certify whether or not they are aware of the information related to the policy. This is done in accordance with the aforementioned IRDAI guidelines and to ensure that the policyholder knows exactly what the policy is going to provide.

Rights Regarding Termination of Policy:

Policyholders have the right to cancel a policy which they think is not suited to fulfil their requirements. If the policyholder wishes to cancel and return a policy, they can do so within a free look period of 15 days. Following successful cancellation of the policy, the insurer is required to refund the premiums which the policyholder may have paid towards the policy. The only charge to be deducted in case of cancellation is surrender charges. More often than not, customers are not aware of this and end up enduring much difficulty as a result. Knowing this is especially important for all those who have decided to purchase an insurance policy via an agent or broker.

Right Regarding Payment of Premium:

Making premium payments may not be consistently easy for a policyholder, especially in case of lump sum payments. To provide customers with relief in terms of making premium payments, the IRDAI allows policyholders to change their policy premium payment frequency. Insurers usually allow policyholders to change their premium payment frequency at the policy anniversary.

Right To File Complaints Against The Insurer:

Policyholders are well within the scope of their rights to take legal action or file a complaint against an insurer if that latter has allowed any discrepancy in the policy process. Some of the most commonly occurring issues which warrant a complaint are where the insurer may have charged premium in excess to what the policy document states or if they delay in making maturity payments.

Many policyholders, when faced with such situations, are at a loss to take the necessary action because they are not aware of their rights. Many also consider it an unnecessary hassle and a lost battle to go up against insurance providers who are large conglomerates. However, if one faces a situation similar to this, they must take action and file a complaint, as no insurer would want to have their image tarnished and would do go to lengths to remedy the situation.

Rights Regarding Death/Maturity Claims:

The essence of a life insurance policy is to provide life cover to a policyholder by way of settling their claims. For the benefit of the common customer, the IRDAI has laid out a set of instructions to be followed by insurers, especially regarding claim settlements. If an insurer has received a death claim on a policy, they must inform the claimant within a period of 15 days about the documents which require to be submitted for claim processing. In case the claim requires additional investigation, the same must be completed by the insurer within a period of 180 days. If no additional investigation is required to process the claim, then the same must be settled by the insurer in not more than 30 days from the date when all claim supporting documents have been received.

In case of a delay in the settlement of the claim, the insurer is required to pay a penal interest amount, over the amount of the claim. For maturity claims, the insurer must inform the claimant a minimum of 2 months in advance about the date on which the maturity claim is due. The payment on the policy must be made within a period of 30 days, starting from the date on which all necessary documents have been received by the insurer.

When it comes to insurance policies, customers often feel apprehensive of voicing their issues or complaints given the widespread belief that it is impossible to have complaints and issues resolved by an insurance company. However, this is not so. If you have a watertight case regarding your claim or complaint, you can confidently file a complaint, which will be looked into the by IRDAI itself.

Given the vast variety of insurance policies that are available in the market, it can often become challenging to choose one which is best suited to one’s requirements. Before purchasing insurance, it is important for one to have adequate knowledge and proper understanding of how their chosen plan works and can provide benefits. As a customer, it is your right to find out everything, be it the good, the bad, or the ugly of a policy, to know exactly what to expect from it. After all, you are investing your hard earned money in it, you have every right to know every last detail so you can get the maximum benefit from your policy.

Know Your Rights When You Buy Insurance Reviews

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  • LIC Life Insurance
    "Average"
    0.5 3.0/5 "Satisfactory"
    I have chosen 2 policies, long term and money back. LIC is good but they will provide the information only If I request them. Paying monthly 2500 rupees through ECS. I did not see any benefits and have no access for online. Every 5 years once they are giving bonus on the money back plan.
    Was this review helpful? 0
    , hosur
    Reviewed on Jan 14, 2019
  • LIC Life Insurance
    "Good policy"
    0.5 4.5/5 "Excellent!"
    I have taken 4 policies with LIC from long back. Its a mixed of endowment, money back and life insurance policy for family. I am satisfied with the benefits. If there is any problem I can manage the account online. I pay the premium by cash or cheque, its hardly around 1300 or 1400 rupees every quarterly and also monthly premium has been done.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 14, 2019
  • LIC Life Insurance
    "Good policy"
    0.5 5.0/5 "Blown Away!"
    I have a life insurance policy with LIC and it was taken almost now 10 years through an agent. The tenure period is 21 years and its a JEEVAN ANAND. The benefits are quite good. I never contacted the customer service, I go through with an agent. I make the premium through online every quarter.
    Was this review helpful? 0
    , thiruvananthapuram
    Reviewed on Jan 14, 2019
  • HDFC Life Life Insurance
    "Very Good Service"
    0.5 4.0/5 "Great!"
    I had taken this insurance policy almost five years back and i had been paying the premium on an annual basis. The premium amount was not too high and the payment method has been easy as well. There has not been any issues faced with the services of them so far.
    Was this review helpful? 0
    , coimbatore
    Reviewed on Jan 13, 2019
  • LIC Life Insurance
    "Good for me and for my nominees"
    0.5 4.0/5 "Great!"
    I have purchased Jeevan anand policy with LIC, my policy has the tenure period of 20 years. As per my policy I need to pay the premium for 15 years, I make Rs. 30,000 per annuam. At last I get the premium cover upto Rs. 20 lakhs and one other good benefits even after the policy expiry there is a maturity benefits of 14 lakhs will provide to the nominees for certain demise its good. But I suggest they need more improvement on the customer support,
    Was this review helpful? 0
    , chennai
    Reviewed on Jan 11, 2019
  • LIC Life Insurance
    "Trusted Insurance Company"
    0.5 4.0/5 "Great!"
    It was taken the policy with LIC in month of 2014, they have good reputation and my relative is working as an agent. To secure my family I took this policy, the policy which I am holding it for 25 years, I will be getting the maturity after the tenure period.
    Was this review helpful? 0
    , kolkata
    Reviewed on Jan 11, 2019
  • LIC Life Insurance
    "Good Investment"
    0.5 5.0/5 "Blown Away!"
    Agents are professional in LIC, and they have flexi in the payment options. I have Jeevan anand policy it has the term period of 15 years, I need to pay the premium for whole year after 24 years I get the return value also they provide life coverage.
    Was this review helpful? 0
    , dandeli
    Reviewed on Jan 10, 2019
  • LIC Life Insurance
    "Good Policy to take"
    0.5 4.0/5 "Great!"
    LIC is providing lots of tax benefits policy hence i have chosen the policy with them. I have taken the Jeevan Anand policy. I used to make the premium amount through online. I'm very much satisfied with the sum assured amount. Total tenure period of the policy is 15 years.
    Was this review helpful? 1
    , hyderabad
    Reviewed on Jan 10, 2019
  • LIC Life Insurance
    "Good Policy"
    0.5 3.0/5 "Satisfactory"
    I have money back policy policy with LIC, it has premium of Rs. 10,000 per annum. It gives the maturity benefits after 20 years of the tenure period, I used to get the bonus amount around Rs. 40,000 for every five years it has the tax benefits too.
    Was this review helpful? 1
    , malda
    Reviewed on Jan 10, 2019
  • LIC Life Insurance
    "Good service"
    0.5 4.0/5 "Great!"
    It has been a good policy and i had started this insurance a long time back. The premium amount has not been not too high and i have been paying it annually where the payment method has not been high. The policy is good and can be suggested to others.
    Was this review helpful? 0
    , pune
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Average Policy"
    0.5 4.0/5 "Great!"
    Purchased my life insurance policy with Life Insurance Corporation of India. I have selected the LIC because of the wife's suggestion. I have chosen the Jeevan Bhima policy. I am paying the premium amount of Rs. 30000 every year. I have no idea about the coverage value. I make the premium through agent via money transfer.
    Was this review helpful? 1
    , new delhi
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Better to invest"
    0.5 5.0/5 "Blown Away!"
    I have a money back policy from LIC which was taken before 10 years through an agent. Every 4 years once they are providing good benefits like bonus points. The agent was very helpful. I got the insurance paper. I am paying the premium every quarterly 1000 rupees through online.
    Was this review helpful? 1
    , pondicherry
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Benefits part should be increased"
    0.5 2.0/5 "Expected more"
    I have term insurance with LIC, they give the life coverage to the nominees, they have option to add multiple nominees. I have taken it for 20 lakhs hence I need to pay the premium around Rs. 7000 per annum, the draw back with this policy they wont provide paritial amount to the holder.
    Was this review helpful? 0
    , thrissur
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Good Bonus Policy"
    0.5 4.0/5 "Great!"
    LIC is national insurance company and it has the good reputation. I have taken the policy called money back policy, it has maturity period around 15 to 20 years, I used to get bonus amount every 3 years or 5 years, they have tax benefits and other facilities.
    Was this review helpful? 1
    , thrissur
    Reviewed on Jan 09, 2019
  • ICICI Prudential Life Insurance
    "Average Policy"
    0.5 3.0/5 "Satisfactory"
    My life insurance was bought from ICICI prudentuial. One of my friend who is working over there has recommended me about this policy. I paid the premium amount of Rs. 25000 annually. I have paid the premium for 2 years after that i have discontinued the policy due to the personal reasons. I have to pay the premium for 7 years actually.
    Was this review helpful? 1
    , tiruchirapalli
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Its Good"
    0.5 4.0/5 "Great!"
    I have taken some policy with LIC, I could not recall the name of the life insurance. But it has the term of 15 years, I need to pay only for 10 years, I get the coverage for whole year. They are providing tax benefits with the life insurance premium and it has life coverage.
    Was this review helpful? 1
    , bangalore
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Not satisfied"
    0.5 2.0/5 "Expected more"
    I have my life insured with LIC from last 15 years and it is a long term policy. I pay my premium once on 6 months through direct payment and i am convenient with the payment options. I am not happy with the returns and tenure period for this policy is for 25 years.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Trusted Insurance"
    0.5 5.0/5 "Blown Away!"
    They saving our money and providing the loan based on the premium but we need to maintain proper track record for the LIC. I have taken the policy for the tenure of 25 years, I need to pay the premium for whole year I expect good value from my three policy.
    Was this review helpful? 0
    , cuddalore
    Reviewed on Jan 09, 2019
  • LIC Life Insurance
    "Life Saving Policy"
    0.5 5.0/5 "Blown Away!"
    My life was insured with Life Insurance Corporation of India. I have purchase a plan called Jeevan Bhima Yojana. Since my father is paying the premium, I'm not sure about the amount. This is a 20 years tenure period policy. I never had any trouble with this policy.
    Was this review helpful? 1
    , chandigarh
    Reviewed on Jan 08, 2019
  • LIC Life Insurance
    "Good service"
    0.5 5.0/5 "Blown Away!"
    I have been holding my life insurance with Life Insurance corporation of India,i took this insurance long bank , the agent had explain me clearly about the policy coverage and plan benefit,and i pay premium on quarterly basis, i pay up to 2700-2800 rupees which was nominal for me,it use to get auto debited from my account.
    Was this review helpful? 0
    , chennai
    Reviewed on Jan 08, 2019
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