INSURANCE
IRDAI asks life insurers to launch ‘Saral Jeevan Bima’ policy by January 01, 2021
Oct-19-2020

The regulator -- the Insurance Regulatory and Development Authority of India (IRDAI) has asked life insurance companies to launch a standard term insurance policy ‘Saral Jeevan Bima’ by January 01, 2021 to help customers take informed decisions. As per the regulator’s guidelines, the Saral Jeevan Bima will be a pure term life insurance product that can be purchased by people in the age group of 18 to 65 years and will have a policy term of 4 to 40 years. The sum assured for the term life insurance policy will range from Rs 5 lakh to Rs 25 lakh (in multiples of Rs 50,000). It noted that all life insurers permitted to transact new business shall mandatorily offer standard life insurance products with effect from January 01, 2021.

Observing that presence of several term products in the market with varying terms and conditions often makes it difficult for customers to make informed decision, IRDAI said ‘a standard product will make it easier for the customers to make an informed choice, enhance the trust between the insurers and the insured, and reduce mis-selling as well as potential disputes at the time of claim settlement.’

As per the guidelines, Saral Jeevan Bima will have no maturity benefit and will have a 45-days waiting period. On exclusions in the policy, the guidelines said ‘only suicide clause, as per extant regulations’. IRDAI said Saral Jeevan Bima is a non-linked non-participating individual pure risk premium life insurance plan which provides for payment of sum assured in lump sum to the nominee in case of the life assured's unfortunate death during the policy term. It further said the product should be offered to individuals without restrictions on gender, place of residence, travel, occupation or educational qualifications.

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