An Insurance Proposal Number is a temporary reference number generated when you submit an application form (Proposal Form) to buy an insurance policy. It signifies that the insurance company has received your request and your initial premium payment, but the risk cover has not yet started.
This number is valid only during the underwriting stage—the period where the insurer checks your medical history, financial status, and documents. Once the company accepts the risk, this Proposal Number is converted into a permanent Policy Number. If the proposal is rejected, the premium is refunded referencing this number.
What Does Insurance Proposal Number Mean?
It is the “Booking ID” of the insurance world.
- Proposal Form: The legal document where you declare your details.
- Proposal Deposit: The first premium you pay.
- Proposal No: The tracker for this transaction.
Until a policy is issued, you are a “Proposer,” not a “Policyholder.”
Why Proposal Number is Important
- Tracking Status: You use this number to check if your medical tests are cleared or if the policy is issued.
- Medical Tests: When you go for a pre-policy medical checkup, the diagnostic center identifies you by this Proposal Number.
- Refunds: If the insurer declines to give you insurance, the refund of your premium is processed against this ID.
Where is Proposal Number Used?
- Customer Care: “I applied 5 days ago, what is the status of Proposal No 123?”
- Underwriting: The backend team uses it to tag your medical reports.
- Receipts: The “First Premium Receipt” (FPR) initially cites the Proposal Number.
How to Find or Check Proposal Number
- Payment Receipt: When you pay the premium online or via cheque, the acknowledgment receipt clearly mentions “Proposal No”.
- SMS/Email: You receive an alert: “Thank you for applying. Your Proposal Number is P-100200.”
- Agent: Your insurance agent can provide this number from their portal.
Example of Proposal to Policy
Scenario: You buy a Term Plan online.
- Day 1: You fill the form and pay. Generated: Proposal No 9999.
- Day 3: You go for a medical test using Proposal No 9999.
- Day 5: Insurer accepts the report.
- Day 6: Policy is issued. Now you get a Policy Number 5000123. The Proposal Number 9999 is now archived.
Common Problems or Errors
- Proposal Lapsed: If you don’t complete medicals within a specific time (e.g., 30 days), the proposal number expires, and money is refunded.
- Confusing with Policy No: You cannot make claims using a Proposal Number. A claim is valid only if a Policy Number exists.
Important Things to Remember
- A proposal is not a contract. The insurer can reject it.
- Keep the proposal number handy until you receive the Policy Bond.
- The “Free Look Period” starts after you receive the policy, not when the proposal is generated.
Frequently Asked Questions
What is the difference between Proposal Number and Policy Number?
A Proposal Number is a temporary ID given when you apply. A Policy Number is the permanent legal ID given when the insurance company accepts your application and issues the contract.
How can I track my policy status using the Proposal Number?
Visit the insurer’s website, look for the ‘Track Application’ section, and enter your Proposal Number and Date of Birth. It will show stages like ‘Underwriting’, ‘Medical Pending’, or ‘Issued’.
Is the Proposal Number valid for tax proof?
No. For Section 80C or 80D tax proof, you generally need the Policy Number and the final Premium Receipt. However, if the policy is pending issuance at year-end, the stamped deposit receipt with the Proposal Number might be accepted conditionally, but it is risky.
What happens if my proposal is rejected?
If the insurer rejects your proposal due to health or financial risks, they will cancel the Proposal Number and refund the entire premium paid (minus medical test charges, if any) to your bank account.
How long is a Proposal Number valid?
It is usually valid for the duration of the underwriting process, typically 30 to 60 days. If the policy is not issued within this timeframe due to lack of documents from your side, the proposal is cancelled.