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Step 1 – the policyholder chooses the Sum Assured and the plan option required. There are four options which are as follows:
|Illness||If Sum Assured is less than Rs.1 crore||If Sum Assured is more than Rs.1 crore|
|Cancer of defined severity||71% of death benefit||71% of Rs.1 crore|
|Heart attack of defined severity||50% of death benefit||50% of Rs.1 crore|
|Stroke of defined severity||50% of death benefit||50% of Rs.1 crore|
Step 2 –then the policyholder chooses the term and the premium paying frequency.
Step 3 – if required, the policyholder can add the additional Accidental Death Benefit Rider to the plan.
Step 4 – in case of death within the term of the plan, the death benefit is paid. The benefit would depend on the option chosen by the policyholder when the plan was bought.
Step 5 – If the plan matures, no benefit is paid.
Nitin, a non-smoker aged 30 years, buys the iSurance Flexi Term Plan for a term of 30 years and a basic Sum Assured of Rs.1 crore.
Option 1 – If Nitin chooses the Lump Sum with Conversion option, his nominee would get Rs.1 crore if he dies during the plan term. Moreover, Nitin can choose to receive the death benefit in case he suffers from cancer, heart attack or stroke. The payable benefit in case of such illnesses would be Rs.71 lakhs for cancer and Rs.50 lakhs for heart attack or stroke.
Option 2 – If Nitin chooses the fixed monthly income benefit, post his death, his nominee would get Rs.60, 000 for 15 years.
Option 3 – If Nitin chooses lump sum + fixed monthly income benefit, on death, Rs.10 lakhs would be paid immediately in lump sum. Thereafter, Rs.50, 000 is paid as monthly incomes for 180 months.
Option 4 – If Nitin chooses the Lump sum + increasing monthly income benefit, Rs.10 lakhs is paid immediately in lump sum on death. Thereafter, Rs.50, 000 is paid as monthly incomes for 15 years. In subsequent years, the monthly incomes would increase by 7.5% compounded annually.
Option 5 – In case the plan matures, Nitin wouldn’t receive anything.
|Age at entry (in completed years)||18 years||60 years|
|Age at maturity (in completed years)||NA||80 years|
|Term of the plan||10 years||62 years|
|Premium paying options||Regular pay|
|Premium Paying term||Equal to the plan tenure|
|Sum Assured||Rs.50 lakhs||Rs.30 crores|
What is not covered by the plan?
If the life insured dies due to suicide within one year of plan commencement or within one year of revival of a lapsed policy, 80% of the premiums paid are refunded.
For the Accidental Death Benefit, accidental death due to suicide, self-inflicted injury, hazardous activities, criminal acts, nuclear contamination, war, aviation, etc. would not be covered.
Below are the sample rates of premium payable by a non-smoking male aged 30 years for a Rs.1 crore cover. The term of the plan and the benefit options are varying.