Know About Saral Jeevan Bima Yojana

After Corona Kavach, Corona Rakshak, and Arogya Sanjeevani, the Insurance Regulatory and Development Authority of India (IRDAI) has come out with a standardised term insurance policy known as ‘Saral Jeevan Bima’. An important reason for introducing a standard life insurance plan is that the current life insurance products available in the market are different and quite complex, and it is difficult for the common man to understand the various inclusions and exclusions of the plans. With Saral Jeevan Bima plan, the regulator aims at increasing the life insurance penetration level mostly amongst the people with low income.

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

There is some good news for the customers who wish to buy a term insurance that is less complicated and is easy to understand and access. Well, the onset of the new year will make available a term insurance policy with a simplified procedure. Keeping in mind the needs of people, the Insurance Regulatory and Development Authority of India (IRDAI) has released rules on standard individual term insurance plans.

Saral Jeevan Bima, as the name suggests, is specifically launched with standard terms and conditions and simple features to allow customers to make informed choice. The introduction of the policy will reduce miss-selling of policies and is likely to increase the trust between insurer and insured. The insurance regulator has made it mandatory for all life insurance policy providers to offer the plan to its customers starting January 1. Saral Jeevan Bima is a pure risk cover with standard wording of sum assured. It will be available for buyers between 16 and 65 years of age and the plan will automatically terminate when the buyer reaches the maturity age of 70 years. The policy has a minimum term of 5 years and stretches up to 40 years. The minimum sum assured is Rs 5 lakh while the maximum is Rs 25 lakh.

In case of death, for limited premium payment or regular premium payment, the benefit paid to beneficiary will be highest of either 10 times of the annualized premium or 105 percent of the premium paid till death. For single premium payment, the death benefit will be higher of 125 percent of the single premium or absolute sum assured amount. The plan will be available on digital platforms, making it more transparent for the customers. If you buy the plan online, you get a 20 percent discount on the premiums. This will allow the customers to compare other policies, their premiums and benefits at the comfort of their homes.

Most term plans consider your annual income to decide the amount of sum assured, but with Saral Bima Yojana allows the customers to buy the sum assured without taking into consideration their annual income. But, before buying the policy, one must also look at the solvency ratio and the claim settlement ratio of the company. The claim settlement ratio is the percentage of claims paid compared to the total claims received and the solvency ratio of an insurer shows company’s ability to meet its obligations.

Benefits Offered by Saral Jeevan Bima Yojana
To simplify the procedure of buying a term insurance plan for customers, the Insurance Regulatory and Development Authority of India (IRDAI) has released the rules on standard individual term life insurance plans to be known as “Saral Jeevan Bima”. All the life insurance providers are directed to offer the plan mandatorily. The Saral Jeevan Bima plan is specifically launched by IRDAI with simple features and standard terms and conditions to make it easy for buyers to make an informed choice. Moreover, with this new rule on standard individual term life insurance plans, the trust between the insurer and insured will also increase and it will also reduce the mis-selling of policies. The New Saral Jeevan Bima policy has been by all the life insurance providers compulsorily from 1st January 2021.

Pure Risk Plan
The Salar Jeevan Bima plan is a pure risk cover non-participating, non-linked term life insurance policy, which will provide insurance coverage as a sum assured amount to the beneficiary of the policy in the case of the unfortunate decease of the life assured during the tenure of the policy. As a pure term policy, there will be no surrender value or maturity benefit offered under the plan. The policy will be accessible to people without any restriction on the place of residence, travel, educational qualifications, gender, or occupation.

As there is a wide range of term insurance policies available in the market, choosing the right plan can be difficult for customers. To cater to the various requirements of the customers and to make Saral Jeevan Bima Yojana available by all life insurance companies, these guidelines are released by the IRDAI. In the past few years, the demand for pure life insurance plans has increased significantly. To meet the increasing demand for policy buyers, life insurance providers have introduced advanced insurance products with different features, options, riders, etc. Same as the standard health insurance product ‘Arogya Sanjeevani’, the Saral Jeevan Bima term life insurance plan will also be the same across all life insurers. It will have the same benefits, inclusion, exclusion, and features. However, claim settlement rate, the prices, service level may vary from insurer to insurer.