Everything You Need to Know About Saral Jeevan Bima Yojana
Listen to Everything You Need to Know About Saral Jeevan Bima Yojana
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Life is full of uncertainty, and you never know what tomorrow will bring. If you are the sole breadwinner of the family, your family's financial security in your absence is probably an important concern. Securing your family with term life insurance is an ultimate solution that ensures your family is financially protected in case of your unexpected demise.
If you have been researching and comparing life insurance premiums online, you know that the cost of life insurance policies has increased. Moreover, insurance companies frequently launch new features and plans, making it difficult for one to choose the right plan. Therefore, by considering the need for a basic and affordable term plan, the Insurance Regulatory and Development Authority of India (IRDAI) has mandated all the life insurance companies to offer a standard term plan, the Saral Jeevan Bima Yojana.
What is Saral Jeevan Bima Yojana?
The Saral Jeevan Bima Yojana is a standard individual term life insurance plan with basic features and terms and conditions, mandated by the IRDAI. Hence, the life insurance companies cannot make any changes in the standard features and terms and conditions rolled out by the IRDAI.
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Let us understand the Saral Jeevan Bima Yojana in detail:
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Similar to regular term plans, the Saral Jeevan Bima Yojana provides life insurance coverage for a certain period, called 'a term'.
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The sum assured is offered to the nominee in the form of a death benefit in case of the unfortunate demise of the policyholder within the policy term. The nominee can get the sum assured only in the form of a lump sum.
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The policyholder is not a beneficiary in this type of insurance because the sum assured is given to the nominee only in case of the death of the policyholder.
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Since the policy was introduced considering a low-income and medium-income group of people, the minimum coverage requirement to opt for Saral Jeevan Bima Yojana is Rs 5 Lakhs, and the maximum coverage limit is Rs 25 Lakhs.
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As these policies are rolled out by the regulator, the premium is affordable for all income groups. However, the premiums may vary from an insurer to insurer based on your age, location, gender, etc. You can use the Saral Jeevan Bima Yojana premium calculator that is available on most insurers' websites to know the exact premium you are required to pay.
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Most insurers offer three premium payment options; regular pay, single pay, and limited pay.
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If the policyholder survives the policy term, he/she gets an option to renew the policy with a new term, but the premium is calculated considering the age and health conditions at the time of renewal.
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Nowadays, many term plans, along with a death benefit, also offer survival benefits, several add-ons and riders, etc. However, Saral Jeevan Bima Yojana is a pure life insurance policy that only offers the sum insured to the nominee upon the unfortunate demise of the policyholder.
What are the important factors to consider when purchasing the Saral Jeevan Bima Yojana?
1. Suitability:
The Saral Jeevan Bima Yojana is the right choice for you if you do not have any term life insurance in your name. The plan is ideal for all income groups, job profiles, genders, and qualifications. Since it is a standard plan, you will have no difficulty choosing the right policy. However, if you want a larger cover, you will have to buy a separate term plan as the maximum limit of the sum assured in this plan is Rs 25 Lakhs.
Similarly, this plan might not be suitable if you require a smaller cover as the minimum sum assured under this plan is Rs 5 Lakhs. You can choose any sum assured in multiple of Rs 50,000 from thereafter. Although the IRDAI permits the life insurers to offer higher sum assured than Rs 25 Lakhs, most insurers have not been offering it because it is not mandatory and they cannot change the terms and conditions laid down by the IRDAI.
2. Premium:
As the features and terms and conditions remain the same across the insurers, the premium is the key differentiator to choose the right policy. However, while purchasing the policy, you should also consider the other important aspects such as claim settlement ratio, company reputation, convenience to buy and renew the policy, etc. Although the Saral Jeevan Bima Yojana claims to be an affordable term life insurance, it is advisable to check the premiums of regular term plans as well, because sometimes regular terms plans from other insurance companies can have a lower premium than the Saral Jeevan Bima Yojana.
3. Premium Payment:
You can pay a premium for Saral Jeevan Bima Yojana in three ways:
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Regular Pay - In this case, you can pay the premium yearly, monthly, or half-yearly.
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Singly Pay - You can select any term and sum assured; you can choose to pay the premium for the entire term at once when purchasing the policy.
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Limited Pay - You can pay the premium for a limited term only and enjoy life cover for the chosen term. Limited pay premium can be paid yearly, monthly, or half-yearly.
4. Eligibility:
Only an Indian resident can apply for the Saral Jeevan Bima Yojana. The minimum age to purchase the policy is 18 years, whereas the maximum age is 65 years. Besides, the maximum maturity age for the Saral Jeevan Bima Yojana is 70 years.
5. Benefits:
As discussed, the Saral Jeevan Bima Yojana offers only the death benefit. So, the sum assured is offered to the nominee only in the form of a lump sum on the unfortunate demise of the policyholder. The Saral Jeevan Bima Yojana does not offer any other benefit, such as maturity or survival benefit and surrender value.
6. Waiting Period:
Like any other insurance policy, the Saral Jeevan Bima Yojana has a waiting period of 45 days from its commencement. In case of an accidental death during the waiting period, the entire paid premium is returned to the nominee after deducting the applicable taxes. Furthermore, loss of life due to suicide is covered under the plan after completion of a year from the start date of the policy.
7. Riders:
Many insurers offer riders, such as Accidental Death Benefit, Permanent Disability Rider, that can enhance the coverage of the Saral Jeevan Bima Yojana. You can purchase these riders along with your basic policy for a slightly increased premium.
8. Policy Term:
You can choose the Saral Jeevan Bima Yojana term from 5 years to 40 years. But, the maximum maturity age of the policyholder for the plan is 70 years.
9. COVID-19 Cover:
The Saral Jeevan Bima Yojana extends its coverage to death occurred due to COVID-19.
10. Tax Benefit:
You can avail of a tax benefit on the premiums paid for the Saral Jeevan Bima Yojana, under Section 80C of the Income Tax Act, 1961.
How to buy a Saral Jeevan Bima Yojana?
You can buy this standard term life insurance plan online by following simple steps from the comfort of your home. Although you can buy it offline, many insurers offer a discount on a premium for the online purchase of the policy.
Follow these steps to buy the Saral Jeevan Bima Yojana online:
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Check and compare the premiums of the Saral Jeevan Bima Yojana Policies offered by different insurance companies.
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Visit the official website of the insurance company you have chosen to purchase the policy from.
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You will find the Saral Jeevan Bima Yojana under the products (term plan) category.
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Click on the 'Buy Now' option of the Saral Jeevan Bima Yojana.
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You will be directed to fill in your personal details, such as your full name, date of birth, gender, lifestyle habits, mobile number, email address, educational qualification, income, height, weight, location, etc.
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Once you submit all the details, it will show you the coverage, policy term, and premium details. You can change the sum assured and/or term to see the difference in the premium.
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Select the amount of sum assured and click on 'Proceed'.
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You can verify your personal and policy details on this page.
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Carefully read the policy details, terms and conditions, and illustrations to understand the policy and click on 'Accept'.
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After accepting all the terms and conditions, you will be directed to the COVID-19 related questionnaire.
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Once you input your answers, you will have to fill the Proposal Form of the Saral Jeevan Bima Yojana and upload the required documents, such as identity proof and address proof. In some cases, you might have to provide any additional documents requested by the insurer.
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You can pay the premium through internet banking, debit or credit cards, etc.
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If any additional information or documents are required, the insurance company will ask for them.
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Upon successful completion of the purchase process, you will receive confirmation from the insurer.
Follow these steps to buy the Saral Jeevan Bima Yojana offline:
You can buy the Saral Jeevan Bima Yojana by visiting the nearest branch of your preferred life insurance company. The insurance company representative will provide you with a Proposal Form, which you need to fill and submit to them along with the required documents. You can make the premium payment either online or through a cheque/DD, etc. Upon successful submission of all the documents, you will receive the policy documents through postal mail.
To Conclude:
The Saral Jeevan Bima Yojana is a great choice for everyone who wants to buy pure life insurance at an affordable premium. By purchasing the riders along with this standard plan, you can enhance the insurance coverage and get most from your life insurance policy. It is advisable to buy the policy online as you can get the benefit of discounts offered on online purchases of the policy. Before purchasing the Saral Jeevan Bima Yojana, make sure you check and compare the premiums, claim settlement ratio, reviews, etc. to make an informed decision.
Warm Regards,
Ketki Jadhav
Content Writer
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