This positive wave is a opportunity for
insurers and service providers to provide more simplified and standard products
to customers with the intention of simplifying the process and bringing more
people under the coverage of insurance.
What is Salral Jeevan Bima
In this regard Insurance Regulatory and
Development Authority of India (Irdai) has obliged all life insurance companies
to provide a standard individual life insurance policy with effect from January
1, 2020.
Why is there a need for a
standard term insurance policy?
To address this issue, IRDA intends to
introduce a unique product that will broadly meet the needs of an average
customer. In this approach a standard, individualized term life insurance
product with simple features and standard terms and conditions is introduced.
Such a standard product would make it
easier for customers to make an informed choice, increase trust between
insurers and insureds and reduce mis-sales as well as potential disputes at the
time of claim settlement.
Standardized products will be actively
available on the digital platform. Customers can get up to 20 percent discount
on premium when purchasing an online plan.
Some highlights of simple life
insurance are a standard term policy.
- The minimum age at entry is 18 and maximum 65 years, although the maximum maturity age is up to 70 years.
- The term of the policy applies from 5 to 40 years.
- Sum Assured Minimum Rs.5,00,000 & Maximum Rs.25,00,000 * (SA only will be allowed over 250,000).
- Premium payment option Regular and limited premium payment period 5 years and 10 years and premium single.
- Premium payment of premium, yearly, half yearly, Monthly (under ECS / NAK only) with regular and limited premium payment options.
- Insured death benefit for regular and limited premium payments, more than 10 times the annual premium, 105% of all premiums paid on the date of death and the entire amount paid on death.
- For single premium policies, more than 125% of the single premium is assured for the entire amount that is paid on death.
- There will be no maturity benefit under the policy, although the option accident benefit and permanent disability benefit riders may be attached.
- No loan will be given against the policy.
- A waiting period of 45 days from the date of commencement of risk, however in case of revival of the policy, the waiting period will not be applicable.
- Surrender value is not applicable under this policy.
Conclusion
The introduction of Saral Jeevan Bima,
which is a standard term insurance, will be a revolutionary step in the life
insurance sector as the plan will help simplify the procurement process and
develop strong trust and confidence in customers towards the life insurance
ecosystem.