Buy With Care: Some Dos and Don'ts
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Buy With Care: Some Dos and Don'ts

IRDA - Buy With Care: Some Dos and Don'ts
You buy insurance for security. So be extra careful when you buy it. It is worth taking care of a few crucial aspects during this process.
Mis-selling by insurers and their intermediaries is something you have to be cautious about. IRDAI keeps a tab on unethical practices by entities selling insurance based on unfounded promises. 
Your insurance company and intermediary have to act according to the Code of Conduct prescribed by IRDAI, the industry councils and the relevant recognised professional association
In case of complaints about mis-selling IRDAI examines the matter and issues an appropriate notice of caution on its website for public information.

Here are some Dos and Don’ts for buying insurance carefully:


  • Buy only from a registered insurer or through his authorised intermediary
  • See the list of insurers on IRDAI's website. Ask them if your intermediary is genuine
  • Ask the intermediary for all information to make a decision
  • Evaluate if he is advising you dispassionately
  • Fill the proposal form yourself and give complete and factual information; False or misleading information could lead to disputes at the time of a claim
  • Do not sign a blank proposal form or leave any portion unanswered
  • If you are not filling it up yourself, ensure that the contents are fully explained to you
  • Remember you have to sign a certificate as part of the proposal form taking responsibility for its contents
  • Make sure you understand clearly:
    • Whether your policy has a single premium or regular premium
    • What your policy term and premium paying term are. They can be different
    • What your surrender value is. It can be less than the premiums you have paid
    • What is covered and what is not covered
    • Understand the returns and bonuses, what is guaranteed and what is not

  • In the case of Unit-Linked insurance policies (ULIPs):
    • Make sure you understand the implications of bearing the investment risk yourself
    • Evaluate the performance of the funds before you invest
    • Understand the various charges levied under the policy

  • When you receive the policy bond:
    • Make sure it matches the terms proposed/ agreed by you
    • If they don’t, you can cancel it during the 15 day "free-look" period from the date you receive the policy bond
    • Premium will be refunded to you with some deductions


  • Do not sign a blank proposal form or leave any portion unanswered
  • Do not conceal relevant information or make any misstatements as it may lead to disputes at the time of a claim

Click here to see Press Release on Misleading Sales Literature on a ULIP

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