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IRDAI asks insurance firms to offer standard term life plan from Jan 1: Check details here

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IRDAI asks insurance firms to offer standard term life plan from Jan 1: Check details here

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The IRDAI has issued a circular to all life insurers directing them to come up with a standard individual term life insurance product which will be named ‘Saral Jeevan Bima.’

IRDAI asks insurance firms to offer standard term life plan from Jan 1: Check details here
The Insurance Regulatory and Development Authority of India (IRDAI) has issued a circular to all life insurers directing them to come up with a standard individual term life insurance product which will be named ‘Saral Jeevan Bima.’ All life insurers permitted to transact new business will mandatorily offer the standard product with effect from January 1, the IRDAI circular said.
Just like the standard health insurance product ‘Arogya Sanjeevani’, the individual term life insurance product will also be the same across all insurers. The product across insurers will have the same features, benefits, inclusions, and exclusions. Though the prices, service level, claim settlement rate may differ.
As per the IRDAI, this will be 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.
"The product will be offered to individuals without restrictions on gender, place of residence, travel, occupation, or educational qualifications," IRDAI said.
The minimum age of entry will be 18 years and the maximum entry age will be capped at 65 and the maximum maturity age will be 70 years. The policy term will extend from 5 to 40 years, according to IRDAI.
The minimum sum assured under the product will be Rs 5 lakh, and the maximum can go up to Rs 25 lakh. The policyholders will also have the option of providing a sum assured beyond Rs 25 lakh.
The product will offer three premium payment options; regular premium, limited premium payment term for 5 years and 10 years, and single premium.
Individuals will be allowed to choose from regular premium payment throughout the policy term, single premium payment in lumpsum, or limited premium payment (5, 10 years) options.
According to Santosh Agarwal, CBO-Life Insurance, Policybazaar, the plan will be a boon for the first-time buyers of life insurance since the product is the same, regardless of the insurance company offering it
"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. The introduction of the 'Saral Jeevan Bima' plan will be a revolutionary move in the life insurance sector as the plan will help in making the buying process much simpler and will develop strong faith and trust in customers towards the life insurance ecosystem," Agarwal said.
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