Now, people buying health policies with a cover for three years or more can surrender them within 15 days if they are not satisfied with the terms and conditions of the agreement. This will be effective from October 1.
According to the Insurance Regulatory and Development Authority (Irda), “All health insurance policies with duration of three or more years will have a provision that on the first inception of the policy, the insured has a period of 15 days from the receipt of the documents to review the terms and conditions of the policy.”
However, the free look-in period is already available for life insurance policies and policyholders have the option of returning it within 15 days if they are not satisfied with the terms and conditions.
In addition, Irda said that the policyholder would be entitled to a refund of the premium paid, excluding expenses incurred by the insurer on his medical examination and stamp duty charges.
“Any failure to do so would render them (general insurance companies) liable to appropriate action under the provisions of the Irda Act, 1999, the Insurance Act, 1938, and the regulations framed thereunder,” Irda said. If the risk has already taken place when the option of returning the policy is exercised by the policyholder, the refund of the premium paid would also be subject to a deduction for proportionate risk premium for the period on cover.
“Where only a part of the risk has commenced, such proportionate risk premium shall be calculated as commensurate with the risk covered during such period,’’ Irda said.
