Under a Rs.1 crore term insurance plan, the sum assured is Rs.1 crore. You can choose the following details –
- The policy tenure
- Premium paying term
- Premium paying frequency
- Optional riders
Based on the coverage details selected, your age, health condition and other risk factors, the premium is determined.
Pay the premium over the chosen premium payment tenure and in the selected frequency. If the life insured passes away during the chosen tenure, the death benefit of Rs.1 crore would be paid. If the insured survives the chosen tenure, no maturity benefit is paid under normal term plans. However, if the return of the premium plan option is selected, the total premiums paid will be refunded basis policy terms and conditions.
Moreover, if there are riders with the plan, either inbuilt or bought additionally, a rider benefit will also be paid if the incident covered under the rider occurs. For instance, if you choose the accidental death benefit rider and the insured passes away in an accident, the rider sum assured would be paid in addition to the death benefit under the term insurance plan.
Let’s take an example to understand how a Rs.1 crore term insurance plan works –
Mr. Verma, age 25 years, buys Bajaj Allianz Life eTouch II, a non-linked, non-participating individual life insurance term plan with a sum assured of Rs.1 crore. Here are the policy details* –
Policy term
|
30 years
|
Premium paying term
|
30 years
|
Premium paying frequency
|
Annual
|
Coverage option selected
|
Life Shield
|
Premium amount
|
1st Year Premium is Rs. 5,092 per annum, 2nd Year onwards premium Rs. 5,520 per annum plus taxes.
|
Variant
|
Life Shield
|
Case 1 – Mr Verma passes away in the 7th policy year
Benefit – His nominee will receive Rs.1 crore as the death benefit and the plan will terminate.
Case 2 – Mr Verma is diagnosed with a terminal illness in the 10th policy year
Benefit – He will receive the sum assured of Rs.1 crore and the policy would terminate
Case 3 – Mr Verma survives the policy tenure of 30years (assuming he bought a pure-term insurance plan)
Benefit – No maturity benefit is paid and the coverage is terminated.
