What Is An Insurance Proposal Form

A proposal form is the most important and fundamental document needed for an insurance contract between a prospective customer and the insurance business.

It contains the necessary information on the customer, such as his or her name, address, age, education, and occupation.

It may also include the individual’s medical history. Some cases

The proposal form introduces the customer to the insurance company and confirms the prospective customer’s identification to guarantee he is not a robot. The insurance proposal is the proposer’s request to the insurance company to provide risk protection.

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.

Content of an Insurance Proposal

Typically, proposal forms are divided into three sections: personal data, subject matter information, and insurance history information.

However, proposal form requirements may differ based on the insurance company and the policy being sold. A specimen will help a prospective customer grasp the proposal form.

We will try to discuss the contents of the proposal form in general, and they include 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 below;

• The answers stated in the proposal form are accurate to the best of the proposer’s knowledge, and information has not been concealed or misrepresented.
• The proposer will agree to pay the premium due and receive a policy that is issued by the insurance company for that class of policy.
• The proposal form together with the declaration shall form a part of the insurance contract.
  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.