There are times when people purchase life insurance only to realise that it is not the perfect cover for them. The good news is that, in case you find yourself in a similar situation, you can use the Free-look period provided with life insurance policies and cancel your policy, to get a refund.
Let’s look at the process of how to cancel an insurance policy during the Free-look period and get a refund. You can choose to cancel life insurance by availing of the Free-look period, typically within 15-30 days after you purchase a new policy. This period specifically applies to policies sourced through distance mode and electronic policies.
How Does it Work?
The Free-look period is provided so that it gives you the proper time to resolve your questions and queries related to the policy. Therefore, feel free to ask as many questions to your insurer regarding your policy for a holistic understanding of your policy. After you are clear about the details and scope of coverage of your policy, you can choose to continue with your plan. In case you feel that the policy does not meet your requirements, you can opt for cancellation of the policy during the Free-look period.
The Free-look period intends to help policyholders undo the decision of getting life insurance if they are unhappy with it within a specific time. It mostly happens when the policyholder is not satisfied by the terms and conditions of the policy. The Free-look period provides the insured person with the space to make a conscious decision regarding a vital aspect of their life.
However, the Free-look option may not work if the policy is not new and freshly purchased. Another factor that weighs in is that the Free-look period doesn’t work if the policyholder has raised a claim in the Free-look period. It must be noted that the Free-look period varies from one insurer to the other.
Cancelling The Policy
The first thing you need to do is to check your policy documents and figure out the duration of the Free-look of your policy. There are two ways to cancel a policy and it varies from insurer to insurer.
Offline Route: For cancelling the policy through the offline procedure you can do via an advisor or by visiting the company’s nearest insurance branch. You will have to submit a written cancellation request. The written document can also be availed through the company’s customer care number. It is wise to be careful about the starting date of the policy while initiating the process.
The cancellation process of the free-look period involves some questioning during which the insurance company makes a last attempt to discuss your concerns and issues or for obtaining consumer feedback. Insurers also generally ask for policy-related documents, reasons for cancellation, etc.
Alongside, you will also have to provide a written document with information like the date on which the policy document was received, information of the insurance advisor who helped in buying the policy, bank account details for the refund, etc. After this, insurers tend to send the endorsement and refund the premium amount within 7 working days.
