Free Look Period In Life Insurance

Free look period refers to the time period under which the life assured can choose to cancel or return the life insurance policy without any surrender charges, in case the life assured is not satisfied with the life insurance policy or its terms and conditions.

Usually for life insurance policy the free-look period is of at least 15 days starting from the date of the policy issuance. During the free look period, the policyholder can decide whether or not to keep the life insurance policy in case if the life assured is not satisfied and wish to cancel or return the life insurance policy.

Life insurance policies are legal contracts that provide rights and responsibilities to both the insurance company and the policyholder. As a policyholder, if you are not satisfied with the terms and conditions of the life insurance policy purchased, you can choose to cancel or return the life insurance policy within a specific time period after receiving the policy and the premiums will be refunded after deducting applicable charges.

You can also use the free-look period to clear your doubts and queries related to the insurance policy and the services provided by the insurance provider. This can be done to understand the policy in a better manner eliminating the need to terminate the life insurance policy, if you still feel dissatisfied with the life insurance policy you can cancel or return the policy.

The free-look period under a life insurance policy begins after you receive the policy document physically.

Below mentioned are some crucial details that must know about the free-look period as per IRDAI:

• A policyholder needs to provide a request in writing to cancel/terminate the life insurance during the free-look period.
• In case the policyholder faila to claim to a refund with policy termination within the free-look period, the following can happen:
• The policyholder will receive the refund of premium after deducting the expenses that the insurance company incurred for the medical test, stamp duty etc.
• In case the risk has already commenced and the option to return the policy is exercised by the policyholder then a deduction of proportionate risk premium for coverage period will be made.
• In case of ULIPs, the insurance company shall be entitled to repurchase units at the price of units as on the date of policy return.