The insurance regulator IRDAI has come out with a standard individual term life insurance product, to be known as “Saral Jeevan Bima”. The policy shall be mandatorily offered by all the life insurance companies from January 1, 2021, onwards. In this respect, all life insurers have to file the product with the insurer latest by December 1, 2020, which will be a non-linked non-participating individual pure risk premium life insurance plan.
Key features of the policy will be as under;
- Under standard individual term life insurance policy, the sum assured in lump sum to the nominee in case of the life assured’s death during the policy term.
- There will be no surrender value under this policy and the insurers cannot give loans to policyholders against this policy.
- The product will offer three premium payment options; regular premium, limited premium payment term for 5 years and 10 years, and single premium.
- For regular and limited premium payment policies, the plan offers death benefit of 10 times of annualised premium, or 105 per cent of all the premiums paid as on the date of death, or absolute amount assured to be paid on death, whichever is higher. In case of single premium policies, either 125 per cent of single premium will be paid, or absolute amount assured to be paid on death, depending on whichever is higher.
- The plan is available without any medical examination of the Life Insured.
- There will be no exclusions, other than suicides. And, the product will be offered to individuals without restrictions on gender, place of residence, travel, occupation or educational qualifications.
- Flexibility to choose policy term: You get the flexibility to choose from 4 policy terms, that are 10, 15, 20 and 25 years.
- The policy term will extend from 5 to 40 years. Minimum age of entry is 18 years, the maximum entry age has been capped at 65 and the maximum maturity age will be 70 years.
- 45 days of waiting period post the commencement of the policy exists but the policy will cover death due to accident during the waiting period of 45 days from the date of commencement of risk.
As per IRDAI guidelines, in case of death of the life assured other than due to accident during the waiting period, an amount equal to 100 per cent of all premiums received excluding taxes if any, shall be paid and the sum assured shall not be paid.