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Proposer In Insurance

To read an insurance policy document properly, you need to know about the terms associated with it. Some of the important participants in a life insurance contract are the proposer, the life assured, the insurer, and the beneficiary. The proposer is the person who buys the policy and pays the premiums.

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Who is a Proposer in Insurance?

Proposer meaning in insurance, refers to the person initiating the policy or the person looking to buy the policy. The proposer is usually the policyholder, as he/she is the one responsible for paying all the premiums for the policy. However, the proposer can be different from the life assured, as a person may buy a policy for their parents, child, or spouse. It is important for a proposer to give all the information correctly, as discrepancies in the details provided can result in a claim rejection in the long run.

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What is the Importance of the Proposer?

The proposer is responsible for the following:

  • Primary Provider of Information: The proposer works directly with the insurer by providing them with accurate information that can help them assess the risk and offer the right premium and cover amount for the life assured.

  • Decides the Details: The proposer decides all the policy details like the cover period, cover amount, type of insurance, and benefits opted within the policy.

  • Premium Payment: The proposer in insurance is responsible for all the premium payments and keeping the policy active.

When Does a Proposer Become a Policyholder?

A proposer in insurance becomes a policyholder once all the details, forms, and the required premiums are submitted and the policy is issued. When the policy documents and all the details are finalised, the proposer is thereon referred to as the policyholder.

What is the Difference Between Proposer and Life Assured?

The proposer can either buy the policy for themselves or for another person with an insurable interest. In the first case, the proposer becomes the life assured. In the second case, the person with an insurance interest becomes the life assured. In both cases, however, the proposer in insurance is the policyholder and, hence, is responsible for the payment of premiums.

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What is the Role of the Proposer in Insurance?

  • Fill out the proposal form and purchase the policy from the insurer.

  • Decide important aspects of the life cover such as the sum assured, coverage period, premium payment term, etc.

  • Decide how the maturity or death benefit payout shall be made viz. in lump sum or in periodic installments.

  • Assign beneficiaries who shall receive the payouts following the death of the life assured.

  • Change and update the beneficiaries or policy terms.

  • Pay premiums for the policy.

What happens if the proposer dies in life insurance?

If the proposer is the life assured under the policy, the assigned nominees will receive the benefit on his/her death. If the two are separate individuals, ownership shall be transferred to the legal heir mentioned in the will of the proposer.

Can the proposer be changed?

The proposer holds the ownership of the policy. Therefore, if the proposer and the life assured are different individuals, ownership can only be transferred upon the death of the proposer. Usually, the proposer will have assigned a new owner in his will prior to death. For this purpose, you can fill in the insurer’s ‘change in ownership’ form and transfer it to the life assured. If the life assured is a minor, the newly assigned proposer shall hold the ownership of policy till the child comes off age.

Important Terms in Insurance

Here is a list of important terms you should know while learning about the proposer in insurance:

  • Proposer - He/she applies for the life cover and pays the premiums for the policy.

  • Insurer - This is the insurance company that will offer the life cover.

  • Life assured - This is the person whose life the insurance policy will cover.

  • Beneficiary - This is the individual who shall receive the death benefit on the death of the life assured.

Wrapping it Up!

The proposer in insurance is one of the most important individuals as he/she directly provides information to the insurer and is responsible for the premium payment. If the information provided is wrong or if the proposer misses a premium payment, it could lead to a claim rejection in the long run.


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