Freelook Cancellation - who will receive the money

[Janardhan]

Hi Friends,

I have Small Doubt?

In Life Insurance Contract Policy Insured, Policy Onwer, and Payer are three different Roles. If the Policy get cancelled in Freelook Cancellation, who will receive the money. Owner or Payer?

Regards
Janardhan

[Krypton]

I think answer is owner.

[CONFUSED]

In Life Insurance Contract there are three parties

1) Life Insured - Whose risk is covered under the contract
2) Proposer - The person who is proposing insurance
3) Beneficiaries / Nominees - The person who is entitled to receive benefit under the contract on the happening of Death of Life Insured or Maturity

Insurance contract deals with basic principle of Insurance - Insurable Interest. The basis is that no one should gain out of insurance. No one should be over insured.

Person has unlimited insurable interest in his/her own life. If person proposes insurance on his/her own life then Life Insured and Proposer are same.

But If Father proposes on life of Son, Then Son is Life Insured and Father is Proposer. If policy is cancelled under freelook period, Father - The proposer will get the money.

This insurable interest depends purely on relation.
Few relationship examples are mentioned below for your info -
1- Father can propose for his child (But child can not propose on father's life)
2- Mother can propose for her child
3- Creditor can propose on the life of debtor to the extent of outstanding loan principal etc.

Regards
Confused

[Expert]

Nice Explaination "Confused" (Nice Name - Anyway)

It would be policy owner.

[Madhura]

Obviously Owner