Saral Jeevan Bima Yojana - Get Pure Risk Coverage with Low-Cost Insurance!

The demand for modest Life Insurance plans has been sharply rising among the Indian middle-class mass, since the last few years. A standardized, low-cost Term Insurance plan is now a prerequisite for people belonging to the mediocre working class. Eyeing the requirement of the people, the government of India passed a term plan, Saral Jeevan Bima, stating that all Insurance companies must offer a standard and cheap term plan, through the Insurance Regulatory and Development Authority of India(IRDAI). The plan is in line with the health insurance policy, Arogya Sanjeevani Policy.

Launched in January 2021, Saral Jeevan Bima is standardized term insurance that all insurance companies must offer with a uniform bunch of coverage features. Across all insurance companies, the coverage benefits, exclusions and eligibility parameters of the plan are the same. But, each company fixes the premium rate based on its pricing policy.

Saral Bima Yojana is a typical pure term plan for everyone, regardless of their educational or occupational background. It's a straightforward life insurance policy that ensures your loved ones' financial security.

LIC Saral Jeevan Bima (Plan No. 859)

It's a basic product that makes it easier to get the desired amount and policy for life insurance. Here are its key features:

• It was created to assist policyholders in making an informed decision about life insurance.
• To financially secure your family, you can choose a sum promised as low as Rs. 5 lakhs and a maximum of Rs. 25 lakhs under this plan.
• If you die unexpectedly during the policy period, your nominee will get a death benefit to help with various life expenditures.
• You can choose a suitable premium payment option that fits your budget.

Pure Risk Plan

Saral Jeevan bima policy plan is a complete risk cover plan. It offers Insurance Coverage as an assured amount for the policy’s beneficiaries in case of the sudden and unfortunate death of the insured during the policy’s tenure. As it is a pure term policy, it does not offer any maturity benefit or surrender value. It will be accessible to people without restrictions of a residential area, travel, gender, occupation, or educational qualifications.

Just like the standard health insurance, Arogya Sanjeevani, the Saral Jeevan bima term insurance policy plan is also bound to be the same among all the life insurance providers. It has all the same inclusions, exclusions, features, and benefits. However, there might be a slight variance in the prices, settlement rates, and service level.

Primary Features of Saral Jeevan Bima

• One gets the option of choosing the sum assured within the minimum and maximum limits in multiples of INR 2.5 lakhs
• The premium can be paid once, through the policy tenure or for a certain period
• It doesn’t provide any maturity benefit and on death, one will get 10 times the annual premium or 1.25 times the single premium
• Both Accident Benefit Rider and Permanent Disability Benefit Rider are allowed
• No surrender amount or loan payable is there under the plan
• Death, except in accidents, within 45 days of buying the policy would not get coverage. In case of suicides within a year of buying or reviving a plan, the insured would only get the paid premiums refunded and not any other benefit

Death Benefit from Saral Jeevan Bima Plan

There is a 45-days waiting period applicable to this policy plan. Here are all the death benefits assured by Saral Jeevan bima:

Death Occurring During the Waiting period

The death benefit amount is payable as a lump sum if the insured person dies during the waiting period and the policy is in force:

• For regular premium or restricted premium payment policies, in the event of accidental death, the sum assured on death is equal to the highest of:

  • The annualized premium multiplied by ten, or
  • 105% of all premiums paid up to the date of death,
  • The amount guaranteed to be paid upon death

• For single premium policies, in the event of accidental death, the sum assured on death is equal to or higher of:

  • 125% of single premium payment, or
  • The amount guaranteed to be paid upon death
  • The death benefit is equal to 100% of all premiums paid, excluding Taxes, if any, in the event of death due to causes other than an accident

Death Occurring after the Expiry of the Waiting Period

If the insured dies, after the waiting period has expired, but before the policy's maturity date and the policy is still in existence, the death benefit amount payable as a lump sum is:

• Sum assured on death is the greatest of the following for regular premium or limited premium payment policies:

  • A premium of ten times the annualized premium, or
  • 105% of all premiums paid up to and including the date of death; or
  • The amount is guaranteed to be paid upon death

• In the case of single premium insurance, the sum assured on death is the greater of:

  • 125% of the single premium, whichever is greater
  • The amount guaranteed to be paid upon death
  • The absolute amount guaranteed to be paid on death is equal to the basic sum assured

Assured Benefits from Saral Jeevan Bima

Here is a list of all the benefits associated with Saral Jeevan bima yojana:

Family’s financial security

The policy nominee receives the death benefits in case of the unfortunate demise of the insured person during the planned tenure.

Flexibility of policy term

Choosing a policy term of 5 years to 40 years according to the corresponding premium payment tenures is easier.

Ease of buying

You can easily buy the Saral Jeevan bima online or offline without any restrictions on occupation, education, living standards, or demographics.

Savings on taxes

The premium amount paid for keeping the plan in force is eligible for the tax deductions according to the prevailing tax laws.

Long-term coverage assured

It includes a term insurance coverage up to the age of 70 years, as per your choice.

Coverage Criteria of Saral Jeevan Bima Yojana

• The entry age should be between 18 to 65 years
• The maturity age should be a minimum of 23 years and not more than 70 years
• The policy tenure should be at least 5 years and a maximum of 40 years
• Sum assured should be a minimum of INR 5 lakhs and a maximum of INR 25 lakhs

Who Can Buy Saral Jeevan Bima Policy?

This plan is available to you if you meet the following criteria:

• If you are single: you may need this term plan to help your parents live comfortably in case of your absence
• If you've recently got married: you can use this policy to plan for your spouse's well-being. It will serve as a financial safety net for them in their later years
• If you have children: this plan will financially assist your family in your absence in a variety of ways, including meeting normal costs or paying for your children's education

  Rider Options Available with Saral Jeevan Bima Policy

This policy also offers the option of add-on accidental and disability benefits for the riders. It is an increase in the coverage of the policy, and the policyholder can add the rider options in the actual base plan by paying some extra premium amount apart from the basic policy premium.

The assured rider sum will be the assured amount payable if any event occurs that the policyholder opted for and is covered in the rider benefits.

How to Choose the Best Term Insurance Policy?

• You need to calculate the number of dependents in your family, who will need financial support from the policy
• Calculate or make a list of your personal and financial requirements like:
• Daily expenses
• Monthly utility or grocery bills
• Upcoming goals like education, business, vacations, marriage, etc
• Medical needs
• Jot down your liabilities like ongoing home/car/Business loans
• Your capacity to pay the premiums and buy term policy needs to be considered as well.
• You should check the insurer’s reliability. The claim settlement ratio needs to be thoroughly checked
• Before selecting one, you should compare numerous term insurance plans offered by the insurer to understand which one suits you the most and provides you utmost benefits, coverage and riders
• Always use a term insurance calculator to get a clearer idea

Conclusion

All the life insurance providers who are allowed to manage the businesses must offer a standard Saral Jeevan bima. It is in effect from 1st January 2021, and all the customers of the life insurance companies can avail the policy and its benefits.

Frequently Asked Questions (FAQs)

1. Which type of product is the Saral Jeevan Bima?

A: The 'Saral Jeevan Bima' is the standard individual term life insurance product. With effect from January 1, 2021, life insurers will be able to transact new business and provide the standard term insurance product 'Saral Jeevan Bima'.

2. Is the Jeevan Saral policy a good one?

A: Saral Jeevan bima is one of the most beneficial Endowment Plan since it is a non-Unit Linked Insurance Plan that provides a lump-sum payment of 250 times the premium paid.

3. What is the minimum and maximum amount that can be guaranteed in a Saral Jeevan Bima?

A: The minimum sum assured offered is 5 lakh INR, which can be increased in multiples of 50,000 INR up to 25 lakh INR.

4. In Saral Jeevan Bima, how is the maturity amount calculated?

A: The plan's Maturity Amount is the sum of the Maturity Sum Assured (which varies depending on the plan's age at entry and term) + Loyalty Additions (if any).

5. Is it possible for me to cancel my Jeevan Saral policy?

A: You can either pay the premium to keep your coverage or surrender the policy and apply for a new endowment policy. If you have paid at least the first three years' premiums, you will receive a surrender value when you surrender the Jeevan Saral plan.