Decoding Insurance

Get Term Life Insurance And Stay Insured Ahead Of Third Wave Of Covid-19

Get Term Life Insurance And Stay Insured Ahead Of Third Wave Of Covid-19

As India’s daily Covid-19 cases have passed 400,000, there is no doubt in the fact that the second wave has been a nightmare. In fact, it has been more virulent than the first one as India witnessed twice the number of maximum active Covid-19 cases in April as compared to the last year. India also became the third country after the US and Brazil to have the highest number of Covid-19 deaths in May when it crossed the 300,000 mark. As uncertainty looms ahead, experts have also suggested that we are going to witness an imminent third wave in September.

Unforeseen situations like these make us realize the importance of having a term life insurance policy. Term life insurance helps your dependents to live a life with dignity in case of your sudden demise. It aids in protecting one’s income and helps in legacy planning. There are a lot of personal expenses including household expenses, child’s education, marriage, liabilities which have to be taken care of in case of your absence. If you are the sole breadwinner of the family then you should definitely take a term life insurance policy as soon as possible.


The second wave of Covid-19 impacted more young people. Hospitals recorded a growing proportion of younger people among Covid deaths as compared to last year and a lowering of the average age of patients admitted to the ICUs. What is more worrisome is the increasing number of cases of Mucormycosis that affects the sinuses, brain, lungs and can be life-threatening in diabetic or severely immune-compromised individuals such as cancer patients or people with HIV/AIDS.

Seeing these trends, it becomes all the more imperative for you to get a term life insurance plan soon. A term life insurance policy pays the entire cover amount to the dependents in case of the death of the policyholder within the policy term. In a term plan, the premium gets locked in for the entire policy tenure. Thus, one should invest at a young age so that the premium amount is lesser.


Adequate sum assured

The sum assured of your term plan should be ten times your annual income. For example, if your annual income is Rs 10 lacs, then Rs 1 crore term cover is the bare minimum that is recommended. However, depending on your age and at which life stage you are, you should assess your sum assured needs. If you are planning to get married, start a family, invest in children’s education, etc, your liabilities will increase. People between the age of 25-35 should buy a term cover which is 20 times their annual income. After the age of 35-45, you could go for a term cover which is 15 times your annual income. After the age of 45 years, you can buy a term cover that is 10 times your annual income because you will have fewer liabilities at that time.

High coverage and affordable

These days, term life insurance policies are available which have a high cover and are very affordable. A 30-years-old person can get a term cover of Rs 1 crore for as low as Rs 800 per month.

Buy early

If you have recently recovered from Covid-19, the insurer may postpone your term life insurance policy for 3-6 months. You might also be asked to undergo a physical medical test. Therefore, it is suggested to buy a term life cover immediately if you haven’t had Covid-19 and get yourself covered under the insurance safety net.

Saral Jeevan Bima

In the last few years, there has been an increased customer preference towards pure term life insurance products. There are many term products in the market with varying terms and conditions. However, customers can not devote enough time to make informed choices to choose the right product. Also, products may not be available for the intended sum assured. 

To take care of this situation and to make available a product by all life insurers that will broadly meet the needs of an average customer, the IRDAI had directed insurers to launch a standard, individual term life insurance product, with simple features and standard terms and conditions. The standard individual term life product is called 'Saral Jeevan Bima'. 

Your income proofs are an important document for buying a term plan. These plans have been brought specifically for people who have irregular sources of income and thus, don’t have standard income documents for getting a term insurance policy. A lot of businessmen, freelancers, labourers, homemakers, people working in unorganized sectors usually don’t have standard income documents. It provides the option of income surrogate where you can submit the registration certificate of your car or two-wheeler as a surrogate to your income proof.

The plans specifically cater to provide basic financial protection to people who are self-employed or belong to a lower-income category, earning about Rs 5 lacs a year. It is a plain vanilla term plan and provides a minimum cover amount of Rs 50,000 upto a maximum of Rs 25 lacs. Earlier, many people were not issued term insurance policies as they were not graduates and above. Your education level is a very important factor while deciding on the sum assured. However, these plans cater to the section of people who are even undergraduates. So, the introduction of these plans is a very good step in narrowing down the protection gap. 

Over the last few months, Saral Jeevan Bima has seen a lot of interesting trends such as the average income bracket of customers investing in the product is between Rs 3 –3.5 Lakhs. The demand for Saral Jeevan Bima is maximum amongst the middle-aged group (31-40) people who contribute almost 50 percent of customers. 


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