Terms and Conditions on Life Insurance Plans

Life Insurance Terms and Conditions

Mentioned below are terms and conditions of a life insurance policy:

• Free Look Period: Life Insurance companies offer a free look period of 15-30 days where the policyholder has an option to cancel or return the policy. The policyholder can cancel the policy if they are not satisfied with the provided policy. The policyholder needs to provide valid reasons for cancelling or returning the insurance policy within 15 days from the commencement of the policy. On cancellation of the policy during the free look period, Insurance provider will return the premium paid with following deductions: a) Expenses incurred by the company on medical examination and b) Proportionate risk premium for the period of policy cover.
• Grace Period: Life Insurance Companies offer a grace period of 30 days from the date of first unpaid premium payment. If the policyholder is unable to pay the premium within the provided grace period the policy will lapse.
• Revival of Policy: Life Insurance providers offer a revival period of 2-5 years under which the policies can be revived within the provided revival period. The policy can be revived by paying all the due premiums with the current rate of interest.
• Tax Benefits: Premiums paid for Life Insurance policies are eligible for tax deductions as per applicable tax laws and conditions. The policyholder is entitled to certain tax benefits on his premiums and benefits. Premiums paid toward life insurance policy qualify for tax exemption under Section 80C and 10(10D) of The Income Tax Act,1961.
• Nomination: The policyholder can make a nomination any time during the policy term for payments of benefits under the policy in the event of an unforeseen demise of the policyholder. Nomination is to be made by an endorsement on the policy or by giving in written to the insurance company. Nomination is allowed under Section 39 of Insurance Act, 1938.
• Assignment: Assignment of the policy is permitted under Section 38 of Insurance Act, 1938. Assignment of the policy is to be made by an endorsement on the insurance policy.
• Suicide: In case the life assured passes away due to suicide within the first 12 month from the date of policy issuance, the insurance company is liable to pay 80% of the total premiums paid till date of the death, to the nominee.
• Fraud: Fraud, forfeiture, Misrepresentation is followed within accordance with provisions of Section 45 of the Insurance Act 1938 as amended from time to time. In case of any fraudulent or misrepresentation the policy is terminated immediately by paying surrender value.
• Loss of Original Policy: In case the original policy document is lost or destroyed then the policyholder needs to make a request to the life insurance company to issue a copy of the policy documents. The insurance company may carry out an investigation to ensure the original policy document is either lost or destroyed. The copy of policy documents may be issued after an endorsement is made stating that it was issued after the loss or destruction of original documents.
• Laws and Jurisdiction: The life insurance policy will be governed by the laws of India. Any actions or procedures taken under the policy are subject to jurisdiction of the court.