All you need to know about the benefits of Saral Jeevan Bima Yojana

A term insurance policy is the best financial safety that you could buy to help your family dealing with uncertainties in their life, even after your demise. It assures that your parents, spouse, children will still be able to afford the current lifestyle with the coverage amount that they will receive on your passing away. In addition, it would enable them to close off any outstanding liabilities such as home loans, auto loans, education loans, etc., and accomplish their dreams.

Rajesh Kothari is a 30-year-old textile merchant from Gujarat and has a shop of his own. He lives with his wife, two kids, and his parents in a flat that he had recently purchased on loan. Though his business is doing good, Rajesh always wanted to buy a term insurance policy, so he could protect his family members from uncertainty in case something untoward happens to him. But he was not able to get a policy since he did not have any formal education or income proofs to submit to the insurance provider. 

Then, in January 2021, he came to know about the launch of ‘Saral Jeevan Bima Yojana,’ which helped him buy a term life insurance policy for a coverage amount of Rs 50 lakhs. As a result, Rajesh is peaceful now, knowing his family wouldn’t have to depend on anyone after his demise.

Though many different insurance providers offer a wide range of term insurance policies, each has its own set of eligibility criteria, including education, occupation, income level, place of residence, etc. Due to this, certain groups of people could not have access to the benefits of term insurance which is why the Insurance Regulatory and Development Authority of India (IRDAI) has released the ‘Saral Jeevan Bima Yojana’ plan.

What is Saral Jeevan Bima?

The Saral Jeevan Bima is a pure term life insurance policy with simple terms and standard features that can be availed by any individual without any preset conditions. IRDAI has mandated all the insurance providers in India to include this policy compulsorily in their product portfolio so more people can buy insurance without any confusion.

Like any other term plan, the Saral bima yojana plan will also pay the sum assured as a lump sum amount to the nominee in case of the policyholder’s unfortunate death during the policy term. Many are searching for Saral Jeevan Bima yojana 2021 to check if there are any changes in this new year. Therefore, the features of this policy are explained below, which should aid you in better understanding.

Top 9 Benefits of Saral Jeevan Bima Yojana

1. Eligibility: While the minimum age to avail of this term plan is 18 years, the maximum age is 65 years, and the age of maturity is fixed at 70 years.

2. Policy Period: The coverage period for this term insurance policy stands at a minimum of 5 years and a maximum of 40 years. For example, if a person aged 25 years buys this policy, he/ she will be covered till the age of 65 years.

3. Sum Assured: This being a standard term product, the cover extends for the entire policy term, and you can choose to avail of the policy with a sum assured starting from Rs. 5,00,000. There is no maximum limit.

4. Premium Payment Options: There is the flexibility provided to choose your convenient premium payment tenure, such as regular, limited, and single payment options. Under the standard option, you are required to pay premiums for the entire policy tenure, and a limited payment facility allows you to pay for five years or ten years only. Similarly, the mode of payment can also be chosen between monthly, half-yearly, and annual, depending on your ability. 

5. Benefit Payout:  In the event of death of the policyholder during the policy term, the coverage assured is paid to the in the following manner:          

• For Regular or Limited premium payment policies: The highest of 10 times the Annualized Premium or 105% of all premiums paid as on the date of death or the absolute amount assured for the event of death is payable.
• For Single Premium Policy: the benefit is 125% of the premium paid or the sum assured that will be delivered on death.

6. Waiting Period: The Saral Jeevan Bima yojana benefits shall be activated only after 45 days since it has a waiting period of 45 days from the date of commencement of risk. 

• The death benefits shall be payable only in case of death due to an accident that might happen within 45 days from the commencement of risk.
• In cases of death of the life assured other accidents that might during the waiting period, an amount equal to 100% of all premiums paid shall be returned, and the sum assured wouldn’t be paid.
• In the event of death of the life assured after the waiting period, the promised death benefit is paid to the nominee.

7. Riders: Riders are useful addons to extend the coverage of the base plan only without modifying the original coverage. Saral Jeevan Bima plans do offer accident benefit and permanent disability benefit riders. Still, one needs to check with the insurance provider to confirm if they are attaching it or not. 

8. Maturity Benefits: This being a pure term plan, does not offer maturity benefits if the policyholder survives the policy term. Similarly, there are no surrender benefits, too, in case you choose to surrender the policy and expect a return of premiums.

9. Income Tax Deductions: The Saral Jeevan Bima plan provided by any insurance company offers income tax benefits on payment of premium and benefits payout. You are eligible to claim deductions for the premiums paid under Section 80C of the Income Tax Act, 1961, and payment of sum assured, or death benefit receivable is also tax-free under Section 10(10D) of the income tax laws. 

The Saral Jeevan Bima term plan has made life insurance affordable for everyone, including those who are less educated and those who are into business and self-employment, who do not have a formal union. With all the features of this term policy explained, it is clear that having standardized term insurance with easy-to-understand terms and conditions helps to define the goal more clearly and also safeguard the livelihood of your dear ones after your lifetime. 

So, you can approach iiflinsurance.com and ask for the Saral Jeevan Bima yojana plan to start your first step towards securing your financial commitments.