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Saral Jeevan Bima Yojana from IRDAI - Everything You Should Know

dateKnowledge Centre Team dateDecember 10, 2020 views165 Views
Saral Jeevan Bima Yojana from IRDAI - Everything You Should Know

Term life insurance is one of the primary financial product you should buy the moment you start earning. However, if you are looking for the perfect solution for your needs, you may feel overwhelmed by the choices.

At present, 24 life insurance companies are providing life insurance products in India. If you merely search for the words ‘term insurance’ you have more than 24 places you can buy the policy from and more than 50 options to choose from.

The fact is that not everyone has the time or interest in becoming a term life insurance expert to secure their family financially. IRDA aims to simplify this quest for everyone with Saral Jeevan Term Insurance plan.

What is Saral Jeevan Plan from IRDA?

Saral Jeevan is a term life insurance plan which has been standardized for the market. That means you will be able to buy this term insurance plan from any life insurer in the country without variations in price, features and benefits.

Starting 1st January 2021 every life insurance provider in the country will need to offer this product compulsorily. So, if you want to buy a term insurance cover to protect your family from the financial effects of your untimely demise, you can simply opt for Saral Jeevan.

Features & Benefits of Saral Jeevan Term Plan

Saral Jeevan term plan is, as easy as its name suggests, to understand. The features are straightforward:

  • Sum Assured is payable on the death of the life assured
  • You will need to pay premiums to secure the cover
  • You can choose to pay the premiums in:

    Regular mode – i.e., every year throughout the policy period or the claim incident

    Limited pay mode – pay annually for only a few years, which is less than the policy period

    Single pay – Pay the premium for the entire tenure in a single instalment

  • The policy has the option where you can choose accidental death and disability riders. You should note that the disability rider is only limited to total permanent disability.
  • The policy also covers accidental death within the waiting period of 45 days, even when you have not opted for the accidental death rider

No Exclusions

The primary benefit of Saral Jeevan plan is that you can buy this term cover from any life insurer without worrying about the exclusions. A suicide clause is the only exclusion in this plan, which also expires after 12 months, as with every other term insurance plan.

Therefore, while buying this term cover you can be absolutely certain about the benefits and features you are getting into. Since this term cover is standard across the industry, there is no need to spend time on the comparison, as there will be no differences.

Limitations of Saral Jeevan Plan

With simplicity comes limitations as well. Few features may also mean lack of many features. However, in the sense of pure term plan, Saral Jeevan does not lack much. Here are the few important limitations you may want to consider before you buy:

  • Maximum sum assured of Rs. 25 lakhs
  • A waiting period of 45 days

The base plan offers a maximum term cover of Rs. 25 lakhs only. However, insurers are free to offer a higher sum assured, which means if you want a higher sum assured you may need to research a little.

Within the 45 days waiting period the sum assured is not payable, except in the case of accidental death. In case of a death claim (other than accidental death) within the waiting period, all the premiums paid for the plan are refunded except the tax deductions.

When Should You Buy Saral Jeevan Term Plan?

Saral Jeevan is a pure term insurance plan, with no difference in features wherever you decide to buy it from. So, if you are a first-time term insurance buyer and do not have time to spend exploring the term insurance world this plan is perfect for you.

Also, you should understand that you need a term insurance cover as soon as you have achieved any of the following milestones:

  • Started earning
  • Have acquired a family or dependents

Saral Jeevan term plan has minimal underwriting needs due to its straightforward features. Thus, you can ensure a financial safety cover for your family quickly with Saral Jeevan plan.

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Frequently Asked Questions (FAQs) for Term Insurance

This being a term plan doesn't offer any payout after maturity or expiration date.

Each insurance company has its own term insurance premium calculator. If you want to check out the premium quote, go for the iSelect Star term plan calculator. It gives a premium amount based on your age, gender, habits, education, and annual income.

You can purchase an iSelect Star term plan anytime between 18 to 70 years of age.

It depends on your needs. For example, if you want to cover a child's education or wedding expenses, you have to include them in your coverage. Your premium will be calculated accordingly.

If your key purpose is to give your Family financial protection, go for the term insurance plan. And if you want some savings, in the end, go for a traditional life insurance plan.

Go for at least 12 times cover than your annual income. Or you can go as far as 20 times coverage as per your needs.

The right time is when you don't have anything to keep your Family safe from financial storms, and they rely on you for financial needs.

If you are unable to make the payment or suffering from a terminal illness, a term plan pays a part of the sum insured to treat your disease.

Term insurance riders are attachment or endorsements made, while taking the term insurance policy, as a supplementary coverage to policyholders. Apart from the core death benefit, term insurance riders offer below-given additional benefits:

  • Accidental Death Rider When a person suffers from a terminal illness, his/her family ends up spending a significant amount in treatment and medical expenses. Accelerated death rider pays a part of the sum insured in advance to cover such costs and save the family from running out of cash.
  • Accidental Disability Rider If the policyholder can't pay the premium because of an accident or permanent disability, a sudden disability this pays the premium on behalf of the policyholder till completion of policy term or for a defined duration.
  • Critical Illness Rider If the insured person gets a heart attack, cancer, or any other critical illness, this rider pays a lump sum on valid diagnosis.
  • Premium Waiver Rider If the policyholder is unable to make payments due to income loss or disability, a premium waiver rider waives off all future premium payments. And the term policy remains active until the expiration date.
  • Income Rider: The rider ensures that your family receives regular income + sum insured in case of unfortunate demise of life insured.

Anyone can go for life insurance as it offers some savings after the maturity date, but it doesn't cover the protection of your family . The best term insurance plan is solely designed for taking care of loved ones if something happens to you. Term plans act as a shield between your family and sudden financial fall. They make sure that your family lives a healthy life even after you. With a little amount paid per year, you can be worry-free from the family's financial conditions.

Questions that you need to ask while buying Term Insurance?

  1. 1. Amount of premium you have to pay based on your age, habits, education, and monthly income
  2. 2. The total number of benefits covered in the term plan. Do they include benefits that you care about the most?
  3. 3. How to save money on tax if you pay for the term plan?
  4. 4. Do they offer regular income options?
  5. 5. Can you change the coverage and premium in the future?
  6. 6. Does the claim consider valid if death occurs outside India?
  7. 7. Which kind of death is not covered by insurance?
  8. 8. Can NRIs take term insurance? If yes, what are the conditions?
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