What is Free Look Period in Life Insurance?
Updated On Jan 26, 2022
Table of Contents
- What Are the Benefits of a Free Look Period?
- How Can You Make the Most of Your Free Look Period?
Many individuals usually associate a free look period with only a long term insurance plan or a life insurance policy. The Insurance Regulatory and Development Authority (IRDA) of India has included a free look period in health insurance policies. It is a consumer-friendly provision that is only available for these two sectors presently.
Insurance has always been a necessity. While there has been significant growth in health-related problems due to the pandemic, the importance of life and health insurance policies have increased crucially. Here's everything that you need to know about a free look period in insurance policies.
What Are the Benefits of a Free Look Period?
There are various benefits of a free look period. A few of them include:
- The main benefit of a free look period is the additional time it provides to policyholders, thus enabling a policyholder to review each term and condition of the policy they bought.
- If a policyholder does not like specific terms or conditions of the policy, he/she can terminate it within the free look period to avoid an additional maintenance fee.
- Within this free look period, you can also get a refund of a few of the premiums paid while buying a long term life insurance plan.
- One of the best features of a look free period is that you don't have to provide a necessary explanation as to why you want to cancel the policy. This can vary depending on the various insurance companies, but the customer service will not try to talk you out of cancellation. As long as you're following the time frame rules, you will get your money.
- A free look period especially allows a policyholder to ensure that he/she wants to dedicate a part of their cash to cover administrative costs regularly.
How Can You Make the Most of Your Free Look Period?
While there are many advantages of a free look period, you must be aware of several other factors. These factors will help you to receive all the essential benefits provided by a free look period. Some of them include:
Give Your Correct Details On The Form.
When you purchase a long term life insurance plan, remember to fill in the correct details of your address and contact number. This will ensure that you can explicitly listen to your plan's features and details during the mandatory welcome call.
Take The Appropriate Time To Review The Policy.
Generally, a policyholder has 15 days to understand all the details and conditions of the policy. Make efficient use of this time to look through the terms, communicate with your company agent, and make sure that you want to keep the policy.
Save The End Date Of Your Trial Period In Advance.
Keep track of the start and end date of your free look period. As soon as you receive the policy, your trial period will begin. Also, before you sign the receipt, always check the date. This is to ensure that you do not sign on a back-dated receipt. This can cut your 15-day free period and make you miss your cancellation period.
Properly Communicate With Your Insurer.
If you have an issue with your policy, you need to communicate it in a written manner instead of oral communication. It is better to communicate in writing to a company, so they get a formal note from your side. At times, a few agents try to delay your side of information to end the free look period. In that case, you need to visit your insurer's office to submit a policy's cancellation.
Do Not Expect A Full Refund Of Your Premiums.
Even if you cancel your long life insurance plan within a free look period, it is liable to expenses on stamp duty and medical tests. If the risk-cover service of your policy has already come into effect, an insurer can deduct the risk premium before canceling your policy.
You can certainly terminate your policy plans if they do not match the requirements of your long-term insurance strategies. Solely designed for your benefits, a free look period serves the purpose of helping you decide whether you want the policy or not.
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Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.