Insurance Proposal Form
The most important and fundamental document needed for an insurance contract between a potential client and the insurance business is a proposal form.
It contains the relevant details about the client, such as name, address, age, level of education, and employment, etc. It might also provide details about their medical background.some instances
The proposal form is used to introduce the client to the insurance provider, establishing the client’s identity and ensuring the client is not a robot.
In the context of insurance, a proposal is a request for risk protection from the proposer to the insurance firm.
The Purpose of a Proposal Form
The uses of an insurance proposal form can be summarized below;
- It is the basic means by which the insurer can access information regarding the risk proposed.
- It also enables the insurer to determine the premium payable on the risk involved in the transaction.
- Proposal forms are the basis on which the insurance contract is based, and all information given by the insured forms part of the agreement.
The Content of an Insurance Proposal
The three primary components of proposal forms are typically Personal Data, Subject-Related Information, and Insurance History Information.
However, depending on the insurance provider and the kind of policy being sold, proposal form specifications may change. A sample will be a helpful study for a potential client to get a thorough knowledge of the proposal form.
We shall attempt to describe the proposal form’s general contents, which comprise the following;
- Name: Name of the proposer is essential for identification as we are all aware. It should be written correctly and accurately for proper documentation purposes.
- Address: The address of the proposer should be accurately written in the proposal form because of several reasons like identity, communication, and risk assessment.
- Occupation: This is most useful in life insurance, and it should state where the proposer works and job specifications. The information gathered from here will influence the risk assessment of an underwriter.
- Subject-matter: This is the subject-matter of the insurance policy and therefore, should be clearly stated to ensure the correct insertion can be made on the policy.
- Sum-insured: This is the limit of the insurance company’s liability on the policy. It must be a representation of the actual value of the subject matter. It represents the amount for which insurance cover is desired should be mentioned accordingly.
- Declaration: Every proposal form has a declaration to the effect the information given
- Signature: The proposer is required to append his /her signature confirming the authenticity of every information stated in the proposal form.
- Date: The date the name was signed on the form.