Buying any form of product has an element of uncertainty attached and prompts you to ask yourself a number of questions such as are you sure it’s the right product for you? Can you afford it? Will it provide what you need it to?
Buying a life-changing product like life insurance can often generate even more soul-searching questions like how much money should I insure myself for? How much money would my loved ones need if I were to pass away unexpectedly? Would my insurance be enough to provide for my children in the future?
It’s for these reasons that most life insurance policies have what’s known as a free-look period. This blog explores the concept of “free look” in a little more detail to demystify it and hopefully give greater peace of mind to your all-important life insurance purchase.
What is a free look period?
Under regulatory guidelines, all life insurance policies contain a cooling-off period, which is referred to as the “free look” period. Put simply, it’s a designated period of time for you to cancel or amend your policy without fear of penalty.
How long is the free look period typically in Dubai?
The free look period for life insurance in Dubai and the UAE is set by the insurance regulator at 30 days.
How is the free look period calculated?
So, when does a free look period start? Typically the countdown starts either from when the policy was issued, the date on which the cover starts, or the date on which the policy documents were signed. If you request to cancel once the free look period has expired, you are likely to incur a penalty so keep an eye on the dates.
Is the free look period an advantage?
The free look period was introduced to protect consumers. Having extra time and breathing space to reflect on your life insurance purchase and consider the terms and conditions, is an obvious benefit. Perhaps most importantly, it provides you with an opportunity to cancel your policy outright and receive a full refund of payment in most cases without penalty. So, if you have a change of heart, change your mind, or just decide to back out for whatever reason, you’re entitled to walk away during the first 30 days.
Once you receive your life insurance policy your free look period will begin, so take the time to review the policy, decide if you need to amend anything or you want to cancel it, and then contact your insurance broker or insurer and let them know your intentions and request that they act on your instructions.
Remember, purchasing a life insurance policy in Dubai is an important decision with implications for both you and your family, so you need to be confident that your chosen policy will meet your needs. Take your time to read all the policy documentation carefully, paying particular attention to the terms and conditions, and ask your broker or insurer to explain anything that’s unclear or that don’t fully understand. The free look period is in place for consumer protection purposes so that you can take the time to reflect on your decision and cancel your policy, if you want to, without fear of suffering any penalty.
The free look period was introduced by the UAE Insurance Regulator (Central Bank of UAE) as part of their overall approach to consumer protection. Importantly, it allows every purchaser of life insurance in Dubai and the UAE, the time and space to reflect on what their policy offers versus their needs, to ensure that the policy meets expectations and requirements. It’s a valuable benefit that every life insurance consumer should take advantage of.