There are certain circumstances as per the contract between the insurer and the insured whereby the insured is eligible to get a refund of premium paid in the policy. Below we will see the circumstances and conditions in which insured can get a refund from the insurance company.
The insurance policy can be ceased at the request of the insured at any time during the active policy period. In such a case the insurance company issue refunds on pro-rata basis subject to following terms and conditions mentioned in the schedule of the policy.
- Claims experience under the contracts all-risk insurance policy as on date of termination should be less than 60 % of the reworked premium.
- The expiry date or the policy period remaining should be more than 3 months or 25% of the policy period, whichever is less
- The testing period should not have started. This insurance may also at any time be ceased at the option of the Company by 15 days’ notice to that effect being given to the policyholder in which case the insurance company shall be liable to repay on demand a ratable proportion of the premium for the period left in the term of the policy from the date of cancellation.
If the actual construction period is lesser than the period mentioned in the schedule of the policy, no refund of premium shall be given unless specifically allowed by Insurance Company.
This discretion is exercised by the insurance company judiciously.