Whether you are opening an account in a bank or seeking a car loan, buying insurance or a credit card, one of the first things that you are asked to do is to fill up a form. We tend to treat this chore as drudgery and go about it rather mechanically.
Often, we skip the fine print, ignore all the conditions listed in a form and fill it up without applying our minds properly. This attitude of disdain for the printed word and the application process also prompts us to leave the job of filling up the form to others and just sign on the dotted line.
But this practice could well land consumers in deep trouble. Let us take credit card forms, for example. Credit card salesmen sometimes turn up at the most unexpected places and at the most inconvenient of times. It could be at a petrol station, where you are impatiently waiting your turn to fill up petrol in your car, or at a supermarket where you are hurriedly trying to complete the mandatory monthly chore of buying provisions. Even as you politely decline the offer of a card, they reel off a long list of benefits that the card offers and if it is a co-branded card (most likely to be, if they are selling at these outlets), the freebies that you get from the retail outlet.
At the slightest sign of your capitulation, you are handed a long application form. Even as you eye the pages with dismay, you are assured that you don’t have to fill them up and that it would be more than adequate if you signed your acceptance of the card offer. That’s a temptation that most consumers find hard to resist.
The other day at a large retail outlet, I saw shop assistants inveigling customers with offers of a co-branded credit card. All that the shoppers had to do was to sign on the form and allow them to take a photocopy of their existing credit card and as proof of residence, a copy of their driving licence. Many obliged and were not even given a copy of the signed form.
If only those who signed had bothered to read the form or fill it up themselves, they would have found in the form a column asking them whether they would like to subscribe for a particular magazine and billed to their credit card. I would not be surprised if some of them start receiving the magazine and later, find the subscription for the magazine charged to their card account! In the absence of a copy of the blank form submitted by them, they would find it difficult to prove that they did not opt for the magazine.
What most consumers don’t realise is that an application form is the most important document that forms the basis of the contract between the consumer and the service provider. So it has to be treated with due respect. Besides filling the form yourself (after reading all terms and conditions) and keeping a copy, it would be advisable to get in writing all the verbal promises made and also all related documents. Remember, credit card firms and also retail outlets keep changing their offers, but as far as you are concerned, whatever is promised to you holds good.
The case of New India Assurance company Vs Shakuntala Bharadwaj in 2001 highlights this point best. Here, the Visa card issued by ANZ Grindlays Bank promised an insurance cover of Rs 4 lakh towards death due to air accident and Rs 2 lakh for accidental deaths. However when her son, Flt Lt Bharadwaj, who was a pilot in the Indian Air Force, died in a tragic air accident while piloting an aircraft and his mother made a claim, the insurance company pointed to the exclusion clause that said the insurance cover was not applicable if you are piloting the aircraft.
However, in the original papers given to Flt Lt Bharadwaj, this exclusion clause was not mentioned. On the basis of this, the court asked the insurance company to pay the insured amount. Talking of insurance, never allow someone else to fill your form when you are buying a policy and make sure that it is filled correctly and the information given is accurate.
Sometimes the insurance agents may gloss over certain answers that you may give or even ask you not to give certain information. Do not go by such wrong advice. Remember, incorrect or wrong information could well jeopardise your claim. So stick to the truth and keep a copy of the form that you have filled and signed. In fact, the Insurance Regulatory and Development Authority’s Regulation on the Protection of Policy Holders’ Interest discourages agents from filling the form.
It, therefore, suggests that “Where, for any reason, the proposal and other connected papers are not filled by the prospect, a certificate may be incorporated at the end of proposal form from the prospect that the contents of the form and documents have been fully explained to him and that he has fully understood the significance of the proposed contract”.
I must mention here an interesting case decided by the apex consumer court in May 1999 pertaining to repudiation of a claim on a health insurance policy by United India Insurance Company on the ground that the policy holder, Gurdeep Singh Oberoi, had suppressed material information pertaining to the policy. On perusal of the proposal form, the apex consumer court found that it was almost blank.
Out of 16 columns, only six had been filled up – and even here, this pertained to basic information such as the name and address of the policy-holder and the table of benefits opted by him. Pointing to this, the apex consumer court said when the form itself was blank and the insurer had accepted it and issued the policy, where was the question of the policy-holder suppressing material facts? It therefore directed the insurer to pay up.
The policy-holder in this case had obviously not bothered to fill the form and had left it to the agent to do so. He was lucky that the agent left it blank. If he had filled up the columns with incorrect information, it could well have resulted in the rejection of his claim.
Whether you are applying for a plot of land, or a vehicle loan, signing a consent form for surgery or filling up a form to join a gym, remember to read the form carefully, fill it up yourself and keep a copy along with all the accompanying documents. If any verbal assurances are made at the time of signing the form, ask for it in writing. In short, be a discerning consumer and protect your interests.
An insurance joke – Jokes on the insurance industry often tell stories about the fine print in application forms and policies. Here is one from an industry Website:
The other day my house caught fire. The insurance agent said, “Shouldn’t be a problem. What kind of coverage do you have?” I said, “Fire and theft.” The insurance agent frowned. “Uh-oh. Wrong kind. Should be fire OR theft.”
Apparently, the only way I can make a claim with this coverage is if the house is robbed WHILE it’s burning down.
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