Proposal in simple English means an application. We submit an application to an insurance company requesting for insurance. Examples: An application for a job; an application for admission in a college; and an application for waiver of fee etc.
An application is a written statement wherein a motor insurance customer writes about himself, his
assets, income, age and other personal information. These statements and other information where necessary are used by the insurance company to decide whether to accept the risk or not, if the risk is to be accepted then what should be the premium.
If the client gives wrong information or misleading information then insurance company has every right to cancel the policy and / or not to pay the claim or both. Hence stating truthful information is always good.
Generally, majority of agents, the middlemen and the touts (I am deliberately using the word tout,
especially in motor insurance), in their anxiety to earn some quick commission always tell the prospective customer ‘Don’t worry sir! We will fill the application for you. Just sign here on the
dotted line!’ We can sign the application… but some wrong information then the insurer will not pay
the claim when we need it most. There are many legal provisions about the duties of an agent,
broker and other middlemen. While stating that they are all excellent, I strongly advise to read the
application, before signing, at least once.
Unfortunately, at present the motor insurance application form (this insurance is compulsory) is only available in English not in the vernacular language! I fail to understand what prevents the regulator in doing so. Further, majority of the words stated in the application form are never explained! Therefore, read the application while you fill in. Understand it. In India, many claims are rejected on frivolous grounds by the insurer and the customer is left to fend himself. I can give a thousand genuine examples. I would not have spoken so much had it been any other insurance policy. For example, a life insurance policy…reason – it is voluntary whereas the motor insurance is compulsory.
In other words, the owners of a motorcycle or a car or any other motorized vehicle are told by the
law that it is imperative to insure the vehicle. Reading the application at least once before you sign alone can solve the problems. As Americans say, always cover your back!
About the Author
Dr. K. Raja Gopal Reddy is a seasoned internationally qualified Insurance professional.
What you are reading here, may not answer all the questions we have, but has the absolute power of asking unsettling questions which increase the interest in the strange world, and show the contradictory wonders lying just below the surface of the commonest things of life. Look at this disturbing but beautiful thought of Friedrich Nietzsche “God is dead. God remains dead. And we have killed him”.
Dr. Reddy can be reached at: raja66gopal@gmail.com
