Life insures have to mandatorily launch standard term life product from Jan 21:IRDAI

The minimum sum assured of the product should be at Rs 5 lakh while maximum sum assured can be Rs 25 lakh. Insurers have the option of offering sum assured beyond Rs 25 lakh under Saral Jeevan Bima with all other terms and conditions remaining the same, said the IRDA. The following  words shall be prominently displayed in BOLD, on the welcome letter of policy document as well as on the first page of Sales Literature. “This policy will cover death due to accident only during the waiting period of 45 days from the date of commencement of risk.In case of death of the life assured other than due to accident during the waiting period, an amount equal to 100% of all premiums received excluding taxes, if any, will be paid and the sum assured will not be paid;;

 

Hyderabad:

The segment regulator IRDAI has now made it mandatory for all the domestic life insurers to sell a standard individual term life product as outlined by the regulator from 1st January, 2021. 

There will  be no maturity benefit under the policy, said the IRDAI..

The standard individual term life insurance product will be called, “Saral Jeevan Bima”; the Insurer’s name shall be prefixed to the product name, said IRDAI on Thursday..

The product may be filed by the Insurers latest by 1st December, 2020.  However, Insurers may file the product earlier and offer the same on approval even before 1st January, 2021.

The minimum entry age of insured is at 18 years and maximum entry age will be at 65. The  maximum maturity age of the insured should be 70 years

The minimum sum assured of the product should be at Rs 5 lakh while maximum sum assured can be Rs 25 lakh. Insurers have the option of offering sum assured beyond Rs 25 lakh under Saral Jeevan Bima with all other terms and conditions remaining the same, said the IRDA..

Some of the key features of the product are:

-“Saral Jeevan Bima” is a non-linked non-participating individual pure risk premium life insurance plan, which provides for payment of sum assured in lump sum to the nominee in case of the life assured’s unfortunate death during the policy term.

- Apart from the benefits and riders allowed by the IRDA , no other riders / benefits / options / variants can be offered.  Exclusions under the product other than the suicide exclusion are not allowed in this product.

Death Benefit

For regular and limited premium payment policies: Highest of:

- 10 times of annualized premium;

-105% of all the premiums paid as on the date of death;

- Absolute amount assured to be paid on death.

Waiting period

45 days from the date of commencement of risk. In case of revival of policy, the waiting period shall not be applicable.

The following  words shall be prominently displayed in BOLD, on the welcome letter of policy document as well as on the first page of Sales Literature.

“This policy will cover death due to accident only during the waiting period of 45 days from the date of commencement of risk.In case of death of the life assured other than due to accident during the waiting period, an amount equal to 100% of all premiums received excluding taxes, if any, will be paid and the sum assured will not be paid;;

Approved Accident Benefit and Permanent Disability Benefit Riders can be attached.

Such a standard product will make it easier for the customers to make an informed choice, enhance the trust between the Insurers and the insured, and reduce mis-selling as well as potential disputes at the time of claim settlement, said the IRDA..


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