Tuesday, 19 January 2021

POLICY PROCEDURE AND DOCUMENTATION - LIFE INSURANCE

 

Proposal form: is a standardized form. The proposer who decides to take the life insurance policy makes the proposal through this form. The forms provide the relevant date for the purpose of assessment of risk. Information must be given correctly and clearly in the proposal form. The insured is required to give two references and the form contains information like name, nationality, occupation, age, family background health, etc. It acts as the base of insurance contract.

Submission of proof of age and medical report: Insurance premiums are worked out on the basis of age at entry. So, the insurer insists on submission of proof of age with the proposal form.

The medical examination report is obtained in cases depending on the age and the sum insured. This report can be obtained on medical examination by an approved doctor of the insurance company and is a confidential report.

Scrutiny & Proposal Acceptance: The officers of the company examine the proposal form and the medical reports and then make the acceptance decision. The rate of premium is taken on the basis of the reports and the decision is communicated to the individual who has to pay the first premium immediately. In some cases, the premiums is paid along with the proposal form and the amount is kept as deposit till the proposal is accepted.

Payment of first premium and issue of policy: on receipt of the first premium and after examining the proposal form, the policy document is issued. A policy document is proof of contract. It mentions conditions of the contract and rights of the policy holder. The policy holder keeps the policy in/under his custody.

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