Mr. Kulbhushan Nandwani, AVP, NJ Group

Mr. Kulbhushan Nandwani, face of the NJIB, has a very rich experience in financial advisory and distribution of financial products of over 15 years. In past, he has worked in various capacities with NJ India Invest Pvt. Ltd. as Head - Investment Products & Zonal Sales Head. He has been also very actively engaged in setting Insurance Business and Estate Planning services at NJ Group.

In this interview, Kulbhushan talks about the NJ WWS which was recently launched in select cities for Partners.

1 Congratulations on the successful launch of NJ WWS. Can you briefly introduce this new service to our NJ Partners?

Thanks for the wishes.

Before coming to NJ Will Writing Services (WWS), let me share with you the Indian scenario on succession planning and how Estate planning will fill the gap that prevails in India. We researched and studied on number of people dying without writing a Will. Though we do not get concrete data on same but some newspaper articles suggests that there are more than 95% people who die without writing a Will. Then we have looked at the number of cases pending in Indian courts as distribution of assets in absence of a Will, may lead to property disputes. We found that there are lacs of cases related to property disputes. Thus to reduce such property disputes, one must write down a proper will. A customer works for several years to buy assets and he wish to distribute them to his loved ones as per his wishes but after his death, if he has not done the estate planning, law will decide the beneficiaries and not his wishes.

NJ WWS is a software based IT solution which will enable the customers of our Partners to consolidate all the assets and liabilities and then distribute / bequeath the property as per their wishes. A human being is bundle of wishes, which dies along with the human being. If you wants your wishes to be alive, a will is a very good solution. Presently, we have launched the NJ WWS for Partners of select cities only, namely Surat, Mumbai & Delhi.

2 Globally, estate planning is considered as an important part of financial planning but it is something yet to take off in India. What is your opinion on this?

Financial planning includes three broad categories that every financial planner should look in to (i) Wealth Creation (ii) Wealth Protection and (iii) Wealth Transfer.

Globally financial planners are catering all three needs of the customers but in India estate planning is a very new concept. Financial literacy, I think, is the key to estate planning. We at NJ, strive to provide complete financial planning platform of the customers by empowering our Partners and by providing solutions that will help fulfill GAPs in financial planning of the customers. We are already fulfilling Wealth creation and Wealth protection needs of the customers through products offering such as, MF, Bonds, FD, Direct Equity, etc. for wealth creation and Insurance products for wealth protection. Through Estate planning, we will be entering in to the arena of complete financial planning which will cater Wealth transfer needs of the customers.

3 What is estate planning and what are the tools / ways in which it can be managed?

Estate is the net worth of a person at any point in time alive or dead. Estate planning is a systematic approach to distribute one's estate / property according to his wishes. The ultimate goal of estate planning is to fulfill the estate owner's wishes as closely as possible.

There are several tools of estate planning, such as, Will, Trust, Gift, Power of Attorney, by which one can transfer / distribute his / her assets.

4 Why writing a Will is important for everyone?

There are several benefits of writing a Will. I will list down important ones here.

1. When a person dies without writing a Will, his properties will be distributed as per the succession laws of the religion, he belongs to and not as per his wish. For example, a Hindu male dies without writing a Will, his properties will be distributed among his class I legal heirs in equal proportion. Class I legal heirs includes Mother, Spouse and Children. To every body's surprise Father is not a class I legal heir and even though he may be a dependent, he will get nothing.

2. The other most important benefit of writing a Will is to appoint a Guardian for your minor children. Just imagine if something happens to you and your spouse, who will take care of your children? And who will take care of your property which will be transferred to you children only after they become major?

3. The other benefit is consolidation of assets. When you write a will, you have to provide details of your all assets thus you will have details of all assets on one page.

4. We acquire two things from our birth till the death (i) Relations and (ii) Property and if we wish that our loved ones will not fight over distribution of the property, we should mention our wishes about the distribution of the property on paper.

5 How can Partners benefit from the NJ WWS?

Financial planning is a business of trust. A customer will only allow his advisor to discuss about his life, if he has trust on the advisor. I believe, NJ Partners will come to know who are their real customers and for whom they should spend their valuable time. This service will help NJ Partners, to get trust and loyalty from customers. The relationship of advisor and client will go to the next level if he offers him this service.

As I already mentioned Will writing is a tool of wealth transfer and with this service, NJ Partners will have complete financial planning tools under their belts. Economically too, NJ Partners will make revenue out of every will registered under them.

6 What are the key features of NJ WWS?

NJ WWS is a web based IT solution which has all the convenience a customer needs in writing a Will. Here are the key features of NJ WWS...

1. Login to NJ WWS is restricted to subscribing customers only and it is secured with OTP. Every time customer will access the NJ WWS, a OTP will be sent to his registered Mobile No and Email id.

2. It helps customers consolidate their assets into virtually every asset class /product.

3. We have given flexibility of distribution of assets up to three layers. Customers thus can do ...

   1. General distribution of all assets among the beneficiaries or

   2. Asset class /category specific distribution among the beneficiaries or

   3. Individual asset entry level distribution among the beneficiaries

4. Preparation of Will to be done through experienced panel of lawyers which will communicate with customer in case of any clarity in data entered by customers

5. Only authorized panel lawyers and select employees will have access to data

6. The system is hosted on secured environment with SSL certification with data transmission takes place in encrypted form only

7 How can one register for the NJ WWS?

Registration to NJ WWS is currently restricted to NJ customers only through their Client desk. For customers to enroll for NJ WWS, first NJ Partners have to give their consent for NJ WWS services by accepting terms and conditions on their NJ Partner desk under Admin > consent for NJ WWS. To begin with we have offered this service only to Partners in cities of Surat, Mumbai & Delhi.

Upon subscription to NJ WWS, customers of subscribing Partners can see NJ WWS link on their client desk menu. Customer have to create an account by entering basic details including Mobile no and email id. An OTP will be sent to this mobile no and email id. Upon verifying OTP, customer can proceed for registration fees payment page. By paying registration charges – presently Rs.10,000 + taxes, an account will be created which will remain active for 30 days for entering data.

8 Why should one choose to register for NJ WWS instead of writing his/her Will directly?

The Law does not require any one to write a will in a specific format or language or style. But there are prerequisites of writing a Will that will ensure that the Will document will not be disputed. Here are a few things that cannot be compromised...

1. The language of the Will should be unambiguous. Ambiguity in language may lead to dispute on the validity of the Will and even lead to court litigations.

2. Clear information about the executors, beneficiaries, guardians for minor children and their relationship should be mentioned in the Will.

3. Clear information of what assets will be given and in what proportion to which beneficiary should also be mentioned.

4. Statements on family background, including statements / reasons for including / excluding any specific beneficiaries should be appropriately covered.

5. Preparation should be through a trusted advisor

NJ WWS ensures all the points mentioned above are well taken care of by a panel of lawyers on board who have years of experience in succession planning and Will writing. Therefore we advice all to use services of NJ WWS to ensure proper language, coverage and format and to avoid grounds on which a Will can be contested /disputed.

9 What should interested Partners prepare for having this service in their offerings?

As I mentioned, to become complete financial planner, one must include estate planning services under his belt. A customer will only open up him self against you, if he has trust on you. Once you acquire that trust, the relationship will be lifelong. And It is just a matter of time that even after the death of the customer, you will earn respect from his family, having served as his financial advisor. Having been said that the more and more customers you serve, the better financial planner you will be. Therefore to offer NJ WWS services to you customers, login in to you Partner desk today and give your consent for NJ WWS under Admin menu.

10 What are your future plans regarding estate planning services?

We have presently launched NJ WWS for Partners in select cities of Surat, Mumbai & Delhi. The ideas was to get the experience /feedbacks /suggestions for the same before we scale it to other cities. Very soon, we plan to launch it for Partners belonging to other metro cities.

Currently we are only offering Will writing services through NJ WWS. In near future, we have plans to offer Codicil services and My Legacy Report services. Gradually we may also open up other services also in coordination /partnership with reputed law firms. It may include other value added services like will registration, executor related services, trust management services, etc. This is just the beginning and we will wait for suggestions of our Partners in this regard and will work accordingly.

Mr. Misbah Baxamusa, Vice President - Sales, NJ Group

Mr. Misbah Baxamusa is the National Sales Head for NJ Wealth Distributor Network. One of the oldest in team NJ, he has over 15 years of rich experience in the financial services industry. An MBA by education, Misbah is known for his deep understanding of the distribution practices and its challenges.

What are the key characteristics you see common in all big and successful Partners?
Answer: The business model of the big and successful Partners vary but from what I have seen, I can say that the most common traits of a successful Partner are...

1. He/she really loves the job. If you start loving the job you would not need any external motivation to perform.
2. He/she has the hunger to grow big and be NOT satisfied by what they already have done. They never hesitate to put a bigger target for himself to achieve.
3. He/she is a people's person and likes to meet and talk to new people.
4. He/she enjoy a very strong relationship and also control over the client.

For any Partner aspiring to achieve greater success, these common traits have to be kept in mind.

What is the importance of relationship management in today's business practice and how can we do so effectively?
Answer:

• Managing relationships is akeen to retaining clients. There have been expectations show that acquiring a new client is much more expensive than retaining an existing client. The question really should not be about the importance but on how we can effectively manage our relationships. I believe that we should
• Have good understanding of the client and more importantly, clarity on expectations from us.
• Have good practices set for timely communication like on personal /family events /festivals, alerts /action events on investments /portfolio like SIP /Policy Renewal, FMP maturity, etc. We can also set some regular communications like monthly MF Valuation report or Newsletter, etc.
• Have a proper grievance /query management process in place. No concern of customer should go unanswered.

These are just a few basic things that should be in place. However, relationship management is a much broader subject and Partners should evolve policies & practices to suit their needs.

Why should we focus on customer acquisition going forward?
Answer: Customer acquisition is key to growing your business. The business landscape is evolving where revenue per client may be seen as decreasing. To counter balance this view point, we need to acquire new and quality customers. However, this also puts forward a question of scalability which in turn can be managed easily & smartly with technology.

On the question of quality, one has to be discreet on what type or size of customer to target & acquire. At the lower end, a retail customer must have the potential for an SIP of 10,000 and/or an AUM or 5,00,000 at the minimum to be profitable for the Partners going ahead. Effectively what I am saying is that we all must aim to increase the count of our customers, preferably only through the on-line /E-Account mode, and make business scalable with adoption of technology in our activities.

Fortunately for us, the awareness and knowledge of mutual funds has grown in the market. Today, perhaps for the first time, we have seen investors increasing their equity exposure in spite of a stagnant market. It is sign of maturity in market and we must cash on it.

How can we generate more business from our existing customers?
Answer: We have seen many cases were there are customers who have had started SIP years back but their SIP amount was small and was never increased. Such customers in spite of staying invested for long term did not create huge wealth in spite of very good returns. There is a big lesson here for us.

The old customers who had enjoyed good returns would now have grown bigger in net-worth and would also be very comfortable with mutual funds. They must be reached and communicated of their returns with the objective to generate new business. We must regularly review the client's potential and seek to slowly increase the SIP amounts - at least once every year. A better approach would be to plan for their financial goals and also map the same in the Client Desk were we have a provision. The result of financial planning would be in form of business.

Explore cross-selling opportunities for the client. Explore if the client is interested in products like PMS, MARS, Bonds, etc. They will provide additional opportunities to interact with the customer and know his needs.

Why and how should a Partner start using CRM?
Answer: The new CRM is a big advancement from our earlier version. It carries many new, exciting and practical usage for Partners. Here are a few things which I believe all Partners must do ...

• Open CRM everyday – there is a list of Birthday's /Anniversaries and alerts for other operational events. Make use of the same and greet /inform your clients.
• Start setting your meetings /tasks in the CRM. By doing, you will improve on your time management and also have a ready record of all your activities. Having Client meeting & task records will also help in not missing any important discussion or work with the Client.
• Start entering information of leads /prospects and track their conversion in CRM

Those who are already doing so can go ahead and make more use of CRM, especially the integrated E-mail feature which allows you to setup your personal email ID and then directly use all available alerts to send ready emails to clients. All this takes can be done in few seconds flat.

You talked about Email integration. Can you explain this CRM feature in detail?
Answer: Sure. Most Partners are already using a personal /business email Id and he/she would want to use this email id only for sending alerts & messages to clients. But drafting and sending emails everyday for every event is not easy for Partners. This is were CRM can greatly serve you.

To begin with, you need to set-up your personal email account (s). This can be easily done through the Email (tab in bottom bar) > Configure Email. You can watch the Help > Tutorial for more guidance. We have created automated email messages based on events for e.g. SIP Renewal and Birthday. A complete customised email for the client is ready in CRM.

To send email, all you have to do is to select the events in the report for which you want to email and then click Email tab on the report top. After choosing your personal email account and entering password, the individual emails to the recipient will be sent from your personal email account. You can go to the email box and see those emails in the Sent folder. What this features does is that is helps save enormous time & effort, increases accuracy, improves productivity and strengthens the relationship with the client. All in a matter of few seconds.

Why and how should a Partner start using Partner Business Planning ?
Answer: Every business has to be have a target, however big or small it can be. We have to judge our potential and keep pushing the boundaries steadily. This is the planned way to scale your business big. The Partner Business Planning module is a great way to plan and then to measure the achievement of your targets. The achievement of your targets is automatically done by the system.

Those who are yet to start planning, we can begin to do so by following a simple process...

• Step 1: Set a proper horizon for the targets – say one month or one quarter
• Step 2: Set logical targets in chosen parameters – say New SIPs, New Client acquisition, Net Sales, etc.
• Step 3: Breakup business targets into Clients /groups assuming an appropriate conversion ratio - say 25%. For eg. we need to identify and target new SIP of 40,000 in existing /new Clients if we have a target 10,000 with a 25% conversion ratio.

Note that step 3 can be and should be done before step 2 if you are not aware of your potential business capacity. Doing so will give you clarity to set the targets later.

This is a simplistic approach for business planning that every Partner can and should do. You can go ahead and repeat this process for different periods in future and also for more number of parameters as you may please.

How do you see the financial advisory /distribution practice evolving in the future?
Answer: The most important trend is the move towards technology and especially e-commerce and digital transactions. This trend has changed the face of many industries and it is also something which will impact our industry going forward in a big way. Partners will have to adopt and migrate to the on-line platform if they want to retain and grow their business going forward. Needless to say, the ideal way to be ready for such a future is to have your clients on the E-Wealth platform. The Partners who make the change will be insulated from this disruptive change that may happen sooner than later. An average Partner also needs to evolve and become more technology savvy and make apt use of the many IT supported solutions that we offer.

Secondly, on the advisory side, customers are expecting sincere professionalism and more quality advice. So we all need to work on building our own processes, practices and service standards to remain in the good books of the clients.

Third from the client approach perspective, Partners need to provide holistic solutions and not just talk about products. This would require a change in mindset and we must think in terms of what solutions to customers needs are we offering.

As a professional, how do you personally manage and balance your time and responsibilities?
Answer: As a person I have most of my travels, meetings & reviews pre-planned for at least the next month. I make it a point to be readily accessible to my entire team. At a personal level, I balance my personal life by having one good holiday in a year with family. I also try and stay fit by either going to gym or cycling or running everyday in morning. I am regular participant for half-marathons and love to run with our NJ team. Beyond that, I also keep a close eye on my diet. I believe having a fit body is very important for us, both professionally and personally. Every Partner should try and keep fit and healthy for self, for family and for the good of business.

Mr. Husaini Kanchwala, Head - Product - Investments. NJ Group

Husaini Kanchwala is the Product Head for Investments, having been a part of sales earlier. With an experience over 10 years in the financial services industry, Husaini is responsible for investment product promotions and tie-ups with manufacturers.

Consider a situation, you are having an appointment at 8 am, with an HNI client whom you had been pursuing since last 6 months. It's already 7.30 and you are yet to have breakfast and also have to drop your son to his school bus stop. You are already nervous about this meeting, your kid is cranky and not ready to have breakfast. Your son, pushes the glass of milk away and it spills on to your shirt. In your tension, you slap him and shout at your wife. Your son starts crying louder irrtitating you further. You change your shirt while fighting with your wife and rush to drop your crying son to his bus stop without having breakfast. As you were late, you only manage to catch the bus at the next stop, 1 km away, but not before scolding your son further for the entire route. Its already 7.55 and clients office is 20 mins away. You speed up and break couple of signals to reach quickly just to realise that you have left your presentation folder and laptop at home in the hurry!!

How could this situation be diferent. Suppose, when your son spills over milk on your shirt, you had remained calm and said, "No problem son, just complete your breakfast quickly" and moved on to your room for change of shirt with a much calmer head. You pick up a sandwich and take your son to drop him off. Your son is also apologetic and says sorry. You drop him to his bus stop with a kiss on his cheek. You SMS the client that you will be delayed by 5-10 mins!

So, what's different in the two situations. The background is the same, its just your reaction which is different. Once you lost your cool, you ended up using your enregy on shouting at your wife and son and in fit of anger, you forgot your belongings and messed up an important appointment. While, when you were calm and composed, you were quick in action and entire situation was in better control with client appointment just delayed by few mins.

In life, be it personal or professional, 90% of things are not in our control, but if we can manage the 10% what we can control well, the resultant impact on ourwork will be enormous. We inadvertently end up spending too much of time on discussing, debating or worrying about almost 90% of the things which are completely out of our control and take no action on the 10% which is under our control. Remember, there are too many variable factors at play and it is next to impossible for you to even think of what factor can affect you, controlling it is way off. What we can do in a situation smartly so as to benefit out of it at our level is most important and smart people spend their time and energy on focussing on the 10% and make the most out of it.

If I talk about MF business, many advisors are worried about the falling markets, work done by government, global scenario, operational or regulatory aspects of the business, competition in the market etc etc. While we may spend lot of time (almost 90%) discussing, debating and worrying about these factors, none of them are actually in our control. The stock markets have their way, you can't do anything on the FII flows or earnings (both on positive and negative side), you don't have much of role in policy making in India (forget about US, China, Japan, Greece, Spain etc), you can't do much about which tax will be imposed when, Service Tax, GST etc or at what rate, or how the regulators are going to deal with expense ratios!! No matter how much you read or discuss or think about above aspects, it is not going to change the way things will pan out.

What you have in control is how you utilise your time. You can spend your time meeting and prospecting new clients, understanding the needs of your clients better, doing more activities for growing your business, utilising innovative technological tools to make your business more efficient, brand building and creating your unique identity. If you have strong conviction that your investors are going to create their wealth by investing in Equity markets in long term than there is no point wasting time on non important aspects. And if your clients are going to make money, you can be rest assured that you will also make ample money in the process, though the ways and means might evolve over a period of time and may be different in future than today.

The opportunity in MF business is so large that even if you were to add 1 customer per day and get Rs. 10,000 SIP from him and work like that for next 10 years, you will be not even close to 1% share of total savings in whichever city/market you are working in. Even if you were to do this experiment through Lumpsum business, the results will be same. This is because

1) More than 95% of investors have never invested in SIP (Only 50 Lac SIP customers PAN India approx)

2) Money lying in FD's in India is Rs. 54 Lac Cr as per RBI (against Rs. 4 Lac Cr of Equity MF) and growing year on year. ( For every 1 Cr of your AUM, there is 12 Cr of FD investment!!)

3) With 7.5% annual growth in economy, the average income of families are rising leaving them with more investible surplus

4) With tightening of regulations around black money, other asset classes like real estate and Gold are not showing signs of high growth for coming years

5) Final and most important reason, there is a dearth of good Financial advisors in the country and investors are always on the lookout for a good customer centric advisor and are willing to pay a fee for right advice.

Isn't it a paradox that investors are looking forward to good advisors but majority of advisors are worried about economy, markets or regulators.The smart advisors meanwhile are utilising the opportunity to the hilt, focussing on 10% controllable factors, reaching out to maximum clients through innovative client engagement and usage of technology. For example, while most people were debating using technology platforms, smart partners have taken the lead and shifted their entire business online, which has not only made them free from operational work but has left them with lot more time in hand which has in turn increased the quantity and quality of their client engagements.

To summarise, the 90-10 principle is applicable on all aspects of our life. We need to focus in the right direction and spend more time on the factors which are under our control rather than being stuck on 90% things which we can't change anyway. Whatever change is going to come, is any which way going to be applicable to everyone else too!! What makes you different is how you respond to it and adapt your self to the circumstances, what we can call as utilising our 10%. The MF industry is at an inflexion point and we will be doing a large disservice to our investors if we can't ensure that most of them reap the benefits of this forthcoming growth. We need to have unequivocal focus on reaching out to maximum customers and creating their welath in long term.

Mr. Kulbhushan Nandwani, Director, NJ Insurance Brokers Pvt. Ltd.

Mr. Kulbhushan Nandwani, face of the NJIB, has a very rich experience in financial advisory and distribution of financial products of over 12 years. In past, he has worked in various capacities with NJ India Invest Pvt. Ltd. as Head - Investment Products & Zonal Sales Head. At NJIB, he has been instrumental in setting up the business and is actively engaged in running day-to-day business operations.
In this interview, Kulbhushan talks about the Things to take care while Buying an insurance policy.

You are about to buy an insurance product. Before you sign on the dotted line, do you realise how important this decision is for you? Buying insurance will be among the most critical financial decisions that you will take in your life, especially so when you are buying a long term policies. So before you actually sign, we would like you to consider a check list that will help you go a step further in ensuring peace and confidence that you have acted with prudence and care and that you have reduced grounds /risks of claim rejection, if they may arise in future.

Not Carefully Choosing the Sum Assured:
The purpose of taking insurance is to cover the financial risks that we foresee for an event. We are contributing towards this risk pool assuring ourselves that if any contingency arises, the amount we have spent/lost will be reimbursed and we will not suffer financially in our lives.

So what should be the adequate cover for a life insurance proposal for a term plan? When your income is permitting you to have, say Rs.1.00 crore sum insured towards your life risk, it may become a worry free survival income for your spouse, if the claim arises, since deposits in a FD kind of instrument will give around Rs.8.00 lacs yearly considering @ 8% interest rate. Have we thought like this?

Many of us unfortunately leave it upon the advisor to decide the sum assured. Often it is decided based on budget rather than on actual need or the actual human life value. At the time of claim, the family will receive the sum assured but if it is not sufficient, the family may face certain unpleasant situations which we leave to the best of your imaginations...

Further, after buying a policy, we often also do not review and audit our own policies which would have been bought 5-6 or 10 years back. Have we thought if the sum insured is still sufficient, keeping in mind your growing responsibilities or inflated medical costs or better living standards?

Selecting suitable insurance product and deciding the right sum insured is at the heart of financial planning. Do engage meaningfully with your advisor and think deep into both these aspects before buying a policy. Think of it not as a product but as a solution that has to fit /resolve a problem that will arise in future.

Do not sign blank /pre-filled proposal forms:
Let us now talk about a short but strong advice which many of us do not follow. The advise is to not sign any proposal form which is blank or not filled by you, whether it is for life insurance, mediclaim, personal accident, motor insurance, home insurance or any other form of insurance.

Why? Because only you are aware of your past history and other important details crucial for filling the forms. The answers to questions relating to you and your lifestyle can be answered only by you and not by somebody else even though he may be your long time advisor. Can anybody guess about your health condition or the risk related to your profession or whether you have claimed under your car insurance policy last year?? OR what amount of money will be required by your family in your absence to maintain the same standard of living.

Chances are, if you just sign a pre-filled form or a blank form, leaving the rest to your advisor, you advisor may or may not fill all information accurately and honestly. Why leave such important form for someone else? After all, it is about you who we are talking about and who else knows you better than you!! The answer is no. This “NO” creates a problem. How? Continue reading ...

Disclose all details honestly:
Many of us often do not disclose all details asked in the proposal form. While some of us may deliberately hide any information, there are many who think that the information is not very important to be disclosed, hence they skip. Well, here is a very important advice. Do not hide but instead disclose all relevant facts asked in the proposal form.

Why? Well here is the explanation for the question...

• Buying an insurance policy is like buying a long term promise. This promise is based on the principle of utmost faith where the insurance company trusts that the information that you are sharing is true and factual to the best of your knowledge.
• At the time of claims, the insurance companies often do a background check or investigation where they verify the medical reports/ case history /doctor's notes, etc. (depending on the nature of the claim) against the details disclosed.
• If they find something which is material to the incident (in their view) but was not disclosed earlier, then the claim may be rejected.

Remember that compromising on the principal of utmost good faith and the mutual trust factor can compromise the honouring of the promise by the insurer. And that will defeat the entire purpose of buying insurance. Hence, when in doubt, disclose but before that, try to not allow any doubt creep in your mind. Remember, it is all about your life, your health, your vehicle risk, your property risk we are talking here.

Let us see an example...

• An advisor has come to you and explained one Health Insurance product which you liked. He knows you from some time and do not visibly have had any physical or medical issues in recent past. So to save your time and to please you, your advisor has already filled in the proposal form for you.
• You are happy that there is less paper work and sign the proposal form without spending time to check the list of questions printed on the proposal form. Here you have ignored our both advices – not signing on blank / prefilled form and disclosing all relevant information.
• After some time, you are hospitalized when your treating doctor asks “have you had this kind of complaint before?? now you suddenly recall “Yes, before 5 years I had a similar kind of complaint and I was treated for so and so”. We have to disclose to the treating doctor don't we?
• You put a claim believing that you will receive the claim. But then, you receive a shock that your claim has been rejected.
• Grounds for rejection:
  • This may be a case of not disclosing “Pre-Existing Condition” and it makes your claim not payable.
  • This may be a case of “Non discloser of material fact” which again makes your claim not payable.
  • This may become “Mis-representation while proposing the risk” making your claim not payable.

Question: If I disclose, my proposal may be rejected...
Well, may be or may be not. Whatever they do, know that rejection of a proposal is much better than getting the claim rejected. And it is not the end of the world...

The intent while filling up forms is to make you aware about the minute facts that become a cause for rejection of your claim. Having a pre-existing disease (PED) or condition in our body does not mean no insurer offers a coverage. Here is what can happen when you actually disclose …

• You may get certain products specially designed and available in the industry for covering PED or certain health conditions
• There may be a provision in the contract where insurers would cover the risk of PED if claim arises after the specified waiting period
• Insurers give cover after taking loading premium
• Insurers may even accept the risk if the pre-medical tests show the normal health condition while proposing the risk.

The learning:
Lets' go back to the health insurance proposal form, you are asked if you are suffering from an aliment or have you been treated in the past or do you have certain abnormality since birth... Often some past history /situation which is not an obstacle in our daily lives is not very well remembered and chances are we may forget disclosing that information.

Further, today with the advancement of medical science & technology, the medical experts can identify the age of disease or an aliment or the injury whether occurred before the policy inception or after. So again no point in not disclosing.

As end customers, we have to be cautious while taking any policy. It is our responsibility to ensure that we get the right policy, the right sum assured and the right disclosures made. In the end, we cannot hope to pass on the buck and blame the advisor after the event occurs. It is highly advisable to spend quality minutes on discussing insurance with your advisor, knowing all the important aspects and then few more minutes to properly fill the proposal form.

Happy Insuring!!