The Motor Insurance Proposal Form
Are you aware that Motor Insurance has a proposal form? Online, sure. But a physical form for you to fill up with a pen! At the very beginning of this proposal form, there are two interesting conditions that you have probably missed:
Policy wordings are available on request.
&
Please complete all sections in capitals and tick boxes wherever applicable.
It is known that people generally do not have the requisite technical knowledge of insurance or its terminology. Perhaps the only thing people are aware of is that Motor Insurance is compulsory!
According to the law, driving an uninsured vehicle can result in a fine or jailtime or both. And no one wishes to go to jail! So, what would anyone possible do with the policy wordings that are available on request? How does someone fill up the proposal form when they are clueless about the meaning of majority of the terms and conditions mentioned therein?
For example, who do you think understands words such as:
Proposal form, IDV (Insured Declared Value), Sum Insured, PUC, Total Loss (TL), Constructive Total Loss (CTL), Voluntary Deductible, Vintage and Classic Car Club of India, Automobile Association of India, Third Party Property Damage (TPPD), Legal Liability, Capital Sum Insured, Personal Accident, Hire Purchase/Lease Agreement/Hypothecation Agreement etc.
These are only a few sample words randomly taken from the Motor Insurance Proposal Form/ Application. And what makes it worse is that the same application form does not define these very terms it uses! It’s not just the “common man”, even learned men struggle to fill in a motor proposal form.
Further, the application/ proposal form states that the failure of the proposer (the person filling in the proposal form!) to disclose facts material to assessment of the risk or providing misleading information shall render the contract void!! How can any insurer issue a motor policy without first giving clarity! The punishment for customer innocence can render the contract void. Void means cancelled.
insurancepe endeavours to explain each of such words and phrases used in a proposal form with clarity.
This is imperative as an insured proposal and declaration as stated in the schedule shall become the basis of motor insurance contract.
This blog post is brought to you by the minds at insurancepe!
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