India’s Insurance Regulator, the Insurance Regulatory and Development Authority of India (IRDAI) has directed all life insurance companies to offer a new standard term life policy. Called Saral Jeevan Bima, the policy covering individuals will have to be offered from January 1, 2021.
You may be wondering – “what is Saral Jeevan Bima and what are its benefits?” That’s what we are here to clear up. Through this blog, we hope to shine some light on this new standard term life policy. So, that way you can make an informed decision when purchasing life insurance.
The Basics of Term Life Policy
A Term Life Policy is a policy that offers life insurance for a specific time period (term), like 10 or 20 years. It is common for insurance companies to offer several riders to this policy. These riders vary from company to company, both in terms of features and amount. They can add a lot to your premium amount if you aren’t careful.
You can also be rejected for an insurance policy, for reasons other than financial. Not all policies are available pan-India, so finding a term life policy where you live for the Sum Assured you want can be quite a challenge.
That’s where Saral Jeevan Bima comes in. It simplifies term life policy by removing the confusion around riders. Now, irrespective of where you buy Saral Jeevan Bima from, the features will be the same all over the country. That way, you can get a simple transparent policy without having to worry about missing out on anything.
Saral Jeevan Bima Details
Saral Jeevan Bima is a non-linked, non-participating life insurance plan. That means that the term life policy is not linked to market rates or their performance. Non-participating means that the policyholder does not receive any dividends as bonus or add-ons.
Simply put, Saral Jeevan Bima is a term life policy that pays your nominee the Sum Assured in case of your untimely death. There are no other riders, benefits, variants or options. The only exclusion is suicide, as it is a crime under Section 309 of the Indian Penal Code.
Here are some of the post important aspects of the policy:
|Eligible Age||18-65 years|
|Policy Term||5-40 years|
|Sum Assured||5,00,000 – 25,00,000 (only in multiples of 250,000)|
|Death Benefit||Regular & Limited Premium Payment (highest of): 10x of annualized premium 105% of all premiums paid on date of death Absolute amount assured to be paid on death Single Premium Policies (highest of): 125% of single premium Absolute amount assured to be paid on death|
|Riders||Only accident benefit and permanent disability benefit can be offered|
|Exclusions||Only in case of suicide|
|Waiting Period||0 for revival of policy, 45 days for new policyholders|
As per the IRDAI guidelines, the product should be offered without any restrictions on gender, occupation, place of residence or educational qualifications.
Why Should I get Saral Jeevan Bima?
In its press release the IRDAI said: “Customers who cannot devote adequate time and energy to make informed choices find it difficult to select the right product. To take care of this situation… it is felt necessary to introduce a standard, individual term life insurance product, with simple features and standard terms and conditions.”
Thanks to the IRDAI, almost anyone is eligible for this term life policy. If you are just starting your career, or planning to get a life insurance policy for the first time, this is a great option to go for because it is simple, easy to understand, and you will most likely be eligible.
We recommend that if you don’t have a life insurance policy yet, you should go for Saral Jeevan Bima. Because under Section 80C of the Income Tax Act, the premiums paid towards an insurance policy are eligible for tax deduction. It’s a good way to start saving, and investing in your future.
As a business owner, it’s equally important you take care of your employees as you take care of yourself. So, why not invest in a comprehensive healthcare plan for your team? Onsurity provides is a monthly healthcare membership that’s economical, and flexible to your needs. Head to our website to find out more and give your team the healthcare they deserve.