- Insurance proposal form serves as the basis on which an insurance policy is issued.
- Accurate details need to be filled in order to avoid issues later on
- Verification of details entered are necessary to enjoy benefits of policy
When applying for insurance, a proposer has to fill out the proposal form of the life insurance company. The Proposal form is an important document which provides the details of the proposer and the life assured and which is used as a basis to ascertain the insurability of an individual. Important aspects of your policy such as premiums, and the terms and conditions are based on the information that you provide in this document. The insurance contract is based on the trust that the details you enter in the proposal form are accurate and to the best of your knowledge.
Since the accuracy of details that are entered in the proposal form are critical to the insurance policy, necessary steps should be taken to ensure that the person buying the policy is the one filling the form. Most people just sign the form and allow someone else to fill the details. This might lead to the person inadvertently missing out on some important details that only you’ll know. Therefore, the form should not only be filled by the proposer, but also checked once again to verify that correct details are given. In the event the proposal form is in a language that the proposer doesn’t understand, it should be made sure that all the terms are clearly explained and the proposer has full understanding of the contents in the proposal form before signing the document.
There are many details required in the insurance proposal form, but here are some of the basic and most important ones, that if not filled properly can lead to issues in claim settlement.
- Name – This is very important, as the name entered here will be the name of the policyholder. At the time of claim, if this name does not match, it can lead to non-settlement of the claim.
- Address – If the address is not properly stated, it can lead to a communication gap, which might mean missing out on crucial correspondence from the insurance company.
- Occupation – Which occupation the proposer is involved in affects the decision of the insurance underwriter to a great extent. It can lead to rejection of the proposal or hike in the rate of premium.
- Sum Insured – This is the reason why you are opting for the insurance policy. The sum insured is the amount for which you are seeking coverage, and is also the limit to which the insurer is liable.
- Age- the age as per the last birthday before the filling of the proposal form.
As mentioned before, the relation between the insurer and the insured is based on trust, and every proposal form comes with a declaration to this effect. These declarations consist of statements such as: ‘details given here are true and nothing has been hidden or misrepresented’, ‘the proposal form shall form the basis of the contract’ and ‘the proposer agrees to pay the premium and accept a policy that will be offered after due assessment’.
From the above points, we come to understand just how important the proposal form really is. Hence, it is paramount that those buying an insurance policy should pay meticulous attention while filling their details in this important document, failure of which may lead to adverse consequence.