In the last few years, the need for simple and affordable life insurance plans has increased especially for the average working Indian. Despite the plethora of affordable life insurance plans, including term insurance, the need for a standardized and low-cost term insurance plan was felt.
Hearing the unanimous pleas of Indian citizens, the government, through the Insurance Regulatory and Development Authority of India (IRDAI), passed a direction that all insurance companies should offer a standard and affordable term plan. This term plan is called Saral Jeevan Bima on the lines of standard health insurance policy – Arogya Sanjeevani Policy. It shares similar characteristics across all insurance companies and aims to make low cost term insurance a widespread reality.
What is a term policy?
A term life insurance policy is a simple form of life insurance that protects the earning member/earlier’s loved ones in their absence. Generally, the whole family is dependent on the earning member to meet their day to day needs. But what happens when the earner is not there to take care of his family? At such times, he has the option of getting term insurance to provide financial support to his family members. This financial assistance is in the form of a monetary benefit, called death benefit, which is given to his/her family. In the context of insurance, the earner is called the policyholder, and his/her family members become the beneficiary/nominee. All the policyholder has to pay to get benefits under a term insurance plan is a limited amount, called premium, every month, half yearly or yearly.
What are the benefits of a simple term plan?
The main advantage of a simple term plan is that it ensures that your close ones are protected at all times. They do not need to depend on other sources or take loans to fulfill their dreams or to fulfill their dreams. With the payment made on your unfortunate demise, they can lead a stress free and comfortable life without compromising on their needs. In addition, the premiums are nominal and affordable, and the policyholder has the option to pay one-time or through regular installments as per his income flow and comfort. Apart from providing death benefits, term insurance plans also offer some additional benefits that protect the policyholder and his family in case of life-threatening illness, disability, accident and other unforeseen contingencies.
Cheapest Term Insurance Plans – Features and Benefits of Saral Life Insurance?
As mentioned above, Saral Jeevan Bima is a standard and low cost term insurance plan that is available to all segments of the Indian society, irrespective of age, gender, profession, location and educational qualification. Also, since its features are similar across different insurers, you can easily buy a policy without spending too much time and effort. Its features include:
- Profit amount i.e. ₹5,00,000 – ₹25,00,000. sum insured between
- Policy term of 5-40 years
· 3 premium payment options:
- Lump sum/single premium payment
- Regular premium payment in monthly, half-yearly or annual installments
- Limited premium payment for 5 or 10 years in monthly, half-yearly or annual installments
- Death Benefit payout for single premium payment mode will be 125% of the annual premium paid
- The death benefit payment will be 105% of the annual premium paid for regular and limited premium payment mode
- Two optional riders (additional benefits) on payment of additional premium –
- Accidental Death Benefit Rider benefit
- A permanent and complete disability rider
- Anyone in the age group of 18 years to 65 years can buy this affordable term plan.
How do I choose the best term insurance policy?
The features of a term policy are straightforward and easy to understand. However, you should not rush into buying a term insurance policy without thoroughly reading the terms and conditions and assessing your financial needs and requirements.
Here’s how you can choose the best term life insurance policy:
- Calculate the number of dependents (family members) you have who will need financial assistance from a term insurance policy.
2. Factor in your family’s personal and financial needs such as:
- Day to day expenses and lifestyle needs.
- Monthly/Annual bills like utility bills, grocery bills etc.
- Goals like education, business, marriage, holidays etc.
- Medical and health needs
3. Factor in your own needs and liabilities such as:
- Loan / Loan for Home, Car or Business
- Post retirement needs
- Health care needs
4. Consider your financial capacity to pay the premium and buy a term insurance policy. Keep in mind your monthly/annual income and how much you can set aside for the policy.
5. Once you have analyzed your needs and that of your family, proceed to the insurer of your choice. Check the credibility of the insurer and the quality of services offered. You can check their claim settlement ratio (which is the number of claims settled by them in a year) to confirm its credibility. Check customer testimonials and seek professional expert advice if necessary.
6. Compare various term insurance plans offered by the insurer to find the one that best suits your needs and offers you maximum benefits, coverage and riders.
7. Use a term insurance calculator to get a clear idea of how much coverage you can get and how much premium you have to pay for different policies.
8. Select the policy as per your choice and proceed to buy.