Agency Functions and Policyholder Protection
Agency work does not end with the proposal. This domain tests service duties - an accurate proposal, premium handling, nomination, revival, claim support - and the policyholder's legal remedies when something goes wrong.
Agent and POSP duties
Collect information truthfully and never sign a blank proposal; explain exclusions; issue a proper receipt for every premium; deliver the policy and explain the free look of 30 days; record nomination under Section 39 and assignment under Section 38; help with revival within the permitted period; and assist the nominee with claim documents.
Policyholder protections
- Free look: 30 days from receipt of the policy document to return it for a refund of premium, less proportionate risk and expenses.
- Claim timelines: a death claim is settled within about 30 days of the last necessary document, extendable to 45 days where investigation is genuinely needed, with interest for delay beyond the regulatory timeline.
- Grievance ladder: the insurer's Grievance Redressal Officer (response within 14 days) → IRDAI's IGMS portal → Insurance Ombudsman under the Insurance Ombudsman Rules, 2017 - no fee, complaint within one year of the insurer's rejection or 30 days of no reply.
- Ombudsman award: binding on the insurer up to ₹30 lakh; an insurer may appeal to IRDAI only where the award exceeds that amount.
- Section 45: after three years, a policy cannot be called in question.
Worked example
A nominee's death claim is rejected for alleged non-disclosure, four years after issuance. The agent's role is to help the nominee obtain the written rejection, file with the GRO and, on failure, approach the Ombudsman within one year. Because the policy is beyond three years, Section 45 bars repudiation except on proven fraud, and the insurer would have to justify its stand.
Traps
Saying free look is 15 days; sending a customer straight to the Ombudsman without a written complaint to the insurer first; confusing nomination (the nominee receives the money) with assignment (rights are transferred); and assuming the Ombudsman can award unlimited amounts.