New Delhi: Purchasing term insurance plans is about to become costly for some customers as a few major insurance companies have introduced new terms determining policy premiums.
According to the new conditions offered by a few companies, customers earning less than Rs 5 lakh per year and who are not graduates will have to pay more to take out term insurance. Additionally, top insurers have increased policy premiums to make them unaffordable for many.
As per the guidelines of the Insurance Regulatory and Development Authority of India (IRDAI), all insurers in the country are still offering standard term insurance plans. But they either increased the premium up to 3 times or offered the policy for a shorter period to make it unattractive to financially weak people.
Additionally, a few insurance companies have also put forth a minimum education qualification for purchasing term insurance. A customer must be a graduate to purchase the standard term insurance plan.
If the client is not a graduate, the companies demand proof of income up to Rs 10 lakh of annual income. Reports suggest that increased premium policy and complicated rules for term insurance were introduced as a result of the COVID-19 pandemic.
Reinsurance companies would also have increased their compliance in the case of life insurance products. But that’s not all since reinsurance premiums have also increased significantly.
In India, fixed term rates have remained low compared to other countries. For example, IRDAI’s Saral Jeevan Bima standard term insurance for low-income clients is offered at much lower premiums than other policies.
Here are the rates for term policies:
SBI Life – 30 year old male
The premium for the sum of Rs 50 lakh insured if the income is above 5 lakh and a graduate is Rs 9,614. On the other hand, if the client is not a graduate, the premium increases to Rs 15,518 and the sum insured amounts to Rs 25 lakh in the Jeevan Policy Saral.
HDFC Life – 30 year old male
The premium for the sum of Rs 50 Lakh insured if you earn more than 5 Lakh and graduate is Rs 9349. While the premium increases to Rs 9559 and the sum insured drops to Rs 25 lakh under the policy Saral Jeevan from the bank if the client is not a graduate. . Also Read: Gold Lending Book Outlook in 2022: Huge Scope for Gold Lending Loans for NBFCs and Banks, Says Muthoot Finance MD
Premiums for online term insurance direct plans for males, non-smokers, age – 30, sum insured – ~1 Crore, income above 5 lakhs and graduates. Prices listed below include GST. Read also: Reduction in the price of petrol by Rs 25/Litre in THIS STATE. Big advantage for 2-wheeler owners
March 2020 December 2021 Increase
LIC ~14,122 ~14,122 0%
HDFC lifetime ~ 12,478 ~ 16,207 30%
ICICI Prudential ~12,502 ~17,190 38%
SBI Life ~ 15,070 ~ 17,495 16%
Maximum lifetime ~10,148 ~11,858 17%
Source: Policy Bazaar, Licindia.in, Sbilife.co.in.