IRDA issues new guidelines for Life Insurance companies to bring in the new standard term life insurance policy with the name Saral Jeevan Bima Term Life Insurance. It is exactly like how IRDA did with respect to the health insurance policies (Arogya Sanjeevani Policy – Standard Health Insurance Features and Benefits).
To be frank Term Life Insurance is the simplest form of Life Insurance one can buy without any complication. However, to show that they are the leaders in the market, these Life Insurance Companies started to add many features. Due to this, for a common person, buying a term life insurance turned to be a complicated task.
Hence, to bring the simplicity and uniformity in the product feature, IRDA instructed all the Life Insurance Companies to launch this new Saral Jeevan Bima Term Life Insurance.
All Life Insurers will have to mandatorily offer the standard product with effect from 1st January 2021. The product may be filed by the Insurers latest by 1st December 2020. However, Insurers may file the product earlier and offer the same on approval even before 1st January 2021.
Saral Jeevan Bima Term Life Insurance – Features, Eligibility, and Benefits
Let us now look into the features, eleigiblity and the benefits fo Saral Jeevan Bima Term Life Insurance.
The Life Insurance companies can offer the riders like Accident Benefit and Permanent Disability Benefit Riders along with this product.
You noticed that as per IRDA the maximum sum assured offered under this plan is set as Rs.25 lakh. However, it has given freehand to life insurers to offer the sum assured beyond that. Hence, I hope the life insurance companies will offer beyond Rs.25 lakh than restricting themselves to Rs.25 lakh sum assured.
The new feature of this Saral Jeevan Bima Term Life Insurance is that for single premium and limited premium payment option, you are allowed to cancel the policy, and based on certain calculations, Life Insurance Companies will return you the amount. But there is no such cancellation feature for regular premium policies.
Policy Cancellation Value shall be payable:-
# upon the Policyholder applying for the same before the stipulated date of maturity in case of Single Premium Policy;
# upon the Policyholder applying for the same before the stipulated date of maturity or at the end of revival period if the policy is not revived, in case of Limited Premium Payment Policies.
For Single Premium: The Policy Cancellation Value acquires immediately after receipt of Single Premium and is calculated as follows:
=70% X Single Premium Paid X (Unexpired Policy Term/Original Policy Term)
Limited Premium Payment Term (LPPT): 5 and 10 years: Policy Cancellation Value acquires if at least two (2) consecutive full years’ premiums are paid and is calculated as follows:
=70% X Total Premiums Paid X (Unexpired Policy Term/Original Policy Term)
Conclusion:- By bringing in Saral Jeevan Bima Term Life Insurance Standard Life Insurance, I think IRDA to be frank gave a big relief to Life Insurance buyers. These Life Insurance companies in the mad rush to show their product is the BEST in the market, confused the buyers.
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