Irdai Suggests Extending The Free-Look Period From 15 To 30 Days; What It Means?

The free-look period for policies acquired through any means will be 30 days from the date of receiving the policy document. Insurance companies will gather insured individuals' bank account information at the proposed stage to facilitate electronic refunds and claim payments.
Irdai Suggests Extending The Free-Look Period From 15 To 30 Days
Irdai Suggests Extending The Free-Look Period From 15 To 30 Days

The Insurance Regulatory and Development Authority of India (IRDAI) has suggested on February 14, extending the free look period for policies from the existing 15 days to 30 days. “The free-look period for the policies, obtained through any mode, shall be 30 days from the date of receipt of the policy document,” according to Irdai Protection of Policyholder’s Interests and Allied Matters of Insurers Regulations 2024. At present, life insurance policies mandate a 15-day free-look period, although it extends to 30 days for electronic policies and those acquired through a distance mode. Moreover, numerous companies provide a 30-day free-look period for all policies. Fundamentally, the free-look period enables a policyholder to reconsider the policy if they perceive it was misrepresented after a thorough review of the policy documents.

This is among the proposed policies aimed at safeguarding the interests of policyholders. Other measures include provisions regarding bank accounts, nominations, issuance of policies in electronic format, and more.

According to Apaar Kasliwal, Executive Director at, this move reinforces the customer-centricity of our insurance regulator in ensuring greater transparency for policyholders. Sometimes, in the rush of buying policy, especially around the financial year-end, customers tend to believe what’s being said and the basis that finalizes the buying decision. The nitty gritty around specifics is only known once the policy document is received and given the complexity of certain products, it takes a longer time to review and understand the finer details.

“We are in favour of making the free-look period to 30 days a standard for all the life and health insurance policies for the customers. It enables the customers to review the policies in detail, not only just to understand but also if they have any queries or confusion regarding the same. Given that the scope of coverage comes with conditions and clauses of exemption, it becomes complex for customers to understand quickly. We are confident that by extending the free look period to 30 days, it will allow ample time for policyholders to be thorough in their understanding and help curb the malpractice of misselling,” he said.

If the policyholder chooses to return the policy, the insurance company is required to refund the premiums paid upon purchase, after deducting any proportionate risk premium applicable during the free-look period, as well as charges associated with medical examinations, stamp duties, and other similar fees.

Moreover, according to the draft rules, no life insurance policy can be issued without obtaining a nomination. The Irdai has also suggested that general and health insurance companies should secure nominations both at the inception of new policies and at the time of renewal.

“No policy in case of life insurance shall be issued unless a nomination is obtained. Nomination provisions relating to general, wherever applicable and health insurance policies introduced,” according to the Irdai exposure draft.

If the current draft is finalized, it will be obligatory to issue most policies solely in electronic format. According to the Irdai, policies with sums insured surpassing Rs 100 or single or annual premiums exceeding Rs 10 must be issued exclusively in electronic form, regardless of whether the insurance application was received digitally or not.

The regulator has additionally suggested that insurance companies gather bank account information from policyholders upon issuance to facilitate electronic refunds and claims payments. All stakeholders, including insurance companies and the general public, have the opportunity to provide feedback on these proposals to the regulator until March 4.

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