The Insurance Regulatory and Development Authority of India (Irdai) in order that individuals choose the right term insurance plan and that too without much hassle directed all life insurance companies to come up with Saral Jeevan Bima plan from January 1, 2021. Such a plan needed to incorporate simple features and standard terms and conditions.
Nonetheless, after quite a delay as insurers and insurance regulating entity discussed over the possibility of having flexibility with regard to maximum sum assured and the pricing factor, life insurers have begun to introduce Saral Jeevan Plan.
Minimum sum assured in Saral Jeevan Bima- Rs. 5 lakh that can be increased up to Rs. 25 lakh in multiples of Rs. 50,000
How to select the right Saral Jeevan Bima Term Plan?
Do not go just by the premium pricing of the different life insurers for the product:
Currently, a total of six life insurers including LIC are marketing the Saral Jeevan Plan and now as the features as well as the terms and conditions of the product are similar across insurers, one can go by the price differential. Experts however advise not to go by just the premium pricing as it can prove to be the biggest mistake in the process of selecting the right term insurance plan.
Consider claim settlement ratio:
The death claim settlement ratio is the percentage of insurance claims processed by an insurance company against the total number of claims received. So, in a case if this ratio is 99 percent, this implies that the insurance company has settled total 99 claims (or paid sum assured to the policy's beneficiary or the nominee) out of every 100 claims received.
"This plan provides a higher issuance rate for the lower-income segment groups compared with the other term plans available. While the features of the Saral Jeevan Bima plan are similar across insurers, customer should look at claim settlement ratio," Santosh Agarwal, chief business officer, life insurance, Policybazaar.com is cited as saying in a leading dailies report.
One also needs to factor the ease of on-boarding and after sales service and support of the insurance company such as for the renewals, claim settlement among others.