Rights every Insurance buyer should know
How many times have you as an insurance buyer found yourself apprehensive about insurance policies or voicing out your complaints? To ensure the communication is clear and that the rights of insurance buyers are met, the insurance regulator IRDA has relegated some rules. If the insurance companies deny you your rights, you can file a complaint with the IRDA. Here are some of the rights you should be aware of, if you find yourself in these situations, don’t hesitate from filing a complaint:
- For life insurance, within 15 days of receiving the death claim, the insurance company needs to let you know the documents they need to process the claim. They also need to finish the additional investigation, if required, within 180 days. If no investigation is required, then the insurer should settle the claim within 30 days from when they received the documents. If not, the insurer is liable to pay a penalty over the claim amount.
- When a customer applies for an insurance policy, be it life or general insurance, the insurance company should inform the customer whether it is approved or denied. This should be done within 15 days. If the application is approved, you should get the policy documents within 30 days.
- If, for example, you are unhappy with your car insurance or any other policy, you can cancel it within 15 days of receiving your policy document, without losing a single dime. However, the insurance company can deduct money for expenses such as stamp duty, medical tests, and 15days’ worth of cover.
- You can file a complaint with the insurance regulator if the insurance company has allowed discrepancies in the insurance policy progress. Some major issues insurance buyers face is excess premium or delay in making maturity payments.
- You don’t have to consistently make premium payments if you are not able. IRDA allows insurance buyers to change their premium payment frequency. You can make this change around your policy anniversary date.
- If you couldn’t make the payment on the due date, don’t worry. Your policy won’t lapse until 30 days after your due date. This period is called the grace period.
- In the case of life insurance, if the policyholder dies during this period, the nominee gets the money left after deducting the unpaid premium.
- However, in the case of health insurance, while you get a grace period, you don’t get insurance coverage until you pay the premium. If during this period, the policyholder is hospitalised, they won’t have any money.
- There is no grace period for car insurance. If your insurance expires, you need to buy it again. Moreover, if you miss the payment date, you will lose the no-claim bonus you might have accumulated.
- If your policy has lapsed, you have the right to reinstate it by paying the unpaid premium and penalty amount. You can even revive traditional insurance plans even if it’s been two years since the lapse. In the case of unit-linked insurance plans, you must get the policy reinstated within 45 days.
If you find yourself in a position where you’re confused or feel cheated, it is important to carefully review the policy document to understand your rights and responsibilities as a policyholder.