Categorized | General Insurance

free look period-why is it needed?

The Insurance Agent or the broker has explained all he could about the insurance policy. You have taken time to understand an insurance Policy and measured its pros and cons before purchasing it. Still it is commonplace to feel that the features of insurance you bought are not what were promised. You feel cheated and yet can’t do anything about it.
 
It is to avoid this situation that the life insurance companies provide a free-look period. It is an opportunity for you to go through the policy document, to evaluate its relevance for you and ensure that you have not bought the wrong product. If you do not like what the policy offers, you can return it during the free-look period.
 
How it works

Insurance companies offer a free-look period of 15 days for you to go through the fine print of the policy and take the final decision.  During this period you can cancel the policy without incurring any costs. Full amount is returned to you in case you decide not to keep the policy.

Free-look period begins from the date of your receipt of the policy documents. You can determine during the 15 days time if you wish to continue with the policy or not. If you decide to continue the policy, you don’t need to do anything but pay the future premiums as decided. If you feel that the policy is not what you want, you can cancel the policy during this time and all the payments done by you are returned.

Most insurance companies refund the total amount to the customer but some companies may deduct certain charges like medical examination charges and stamp duty charges.

How to cancel the policy in free-look period


It is always better to call the customer care of the insurance company and enquire the exact process of policy cancellation as it may vary slightly from company to company. The general process is to fill up the free-look period cancellation form and send it to the insurance company. You can also deposit the same at the local branches of the insurance company.

To be on the safer side, it is advisable to keep a copy of the policy and record of the post or courier sent to the insurance company.
 
Life insurance is long Term product that needs to be continued to get the maximum benefit. It is always better to be satisfied fully before you finally decide to keep the policy rather than stopping the premiums or surrendering the policy midway.