This article first appeared in Personal Wealth, The Edge Malaysia Weekly, on July 18 - 24, 2016.

Q: I have been paying the premium for my life and house insurance through my agent for 10 years. But in the last five years, I have been getting messages on and off from the insurance company saying that the premium had not been paid. Each time I ask my agent, who is my brother, he says the payment was delayed and tells me that I need to top up. I finally checked with the insurance company recently and they said the monthly payments had been irregular and I would need to pay a year’s worth of premium to keep the policy. What should I do to get a waiver on the previous unpaid premiums without foregoing the bonuses? What steps can I take to ensure this does not happen again? > Ferby, via email

A: The policyholder will have to lodge a complaint with the insurance company about the discovery of the unpaid premiums. To support his case, the policyholder should provide the insurer with any evidence of cash payments made to the agent/brother, whether in the form of receipts, text messages or emails to enable the insurer to conduct the necessary inquiry or investigation.

Upon completion of the inquiry or investigation, each case will be treated based on the facts. In the event of an agent’s misconduct, the insurer will take appropriate action against the agent and consider restitution options for the policyholder. These options could include a waiver of reinstatement requirements if the policy has lapsed. This will be upon receipt of the outstanding premiums. Alternatively, the insurer could waive the interest on late payment. Bonuses are normally not impacted in cases where the policy is restored with the payment of the outstanding premiums.

As a preventive measure, we always advise policyholders to do the following:

1. If they receive a letter from their insurer on non-payment of premium when they have been making prompt payments, they should approach the insurer to check on their policy status immediately.

2. Customers should also pay their premiums via auto debit or other means of direct payment which are hassle-free. These methods include credit or debit card deductions and standing instructions to their bank accounts. All such payments can be monitored via bank statements. Customers will also receive their annual statements and premium statements, which will allow further verification. Some insurers offer online facilities for their customers to make payments and check the status of their policies.

3. If premium payment has to be made via the agent, the customer should request the agent to provide a receipt issued by the insurer after the payment has been made by the agent on the customer’s behalf.

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