Fill life insurance form with care

In an age when shares can be purchased at the click of a mouse, filling a life insurance proposal continues to be a major chore. More often that not it is the insurance agent who, in his eagerness to sell, fills in the details on behalf of the insured.

What the proposer doesn’t realise is that such a casual approach can make a crucial difference when it comes to pricing, and in ensuring that claims are not prejudiced. Unlike other transactions, insurance is based on faith.

Since the insurance company cannot verify every bit of information, it accepts in good faith whatever details the proposer provides. The flip side is that this gives the company the right to reject claims if there is non-disclosure of a fact that is material to the pricing of premium.

If there is a vague or incomplete entry in the proposal, the underwriter may play it safe and bracket the insured in a higher risk category . This is more applicable in case of policies where there is a high sum insured.

Taking a little more trouble in filling the proposal form can, however, help the insured save premium money. Read on some disclosures that make a difference in price.

Source : economictimes.indiatimes.com