Millions of people waiting to buy a simple life insurance plan can get a shock. Insurance regulator IRDA had directed the insurance companies to bring the policy in easy terms and low premium. However, the simple life insurance plan offered by Edelweiss Tokyo Life Insurance Company is twice as expensive as the simple term plan. This is a major setback for the entire Irda exercise.
The simple life insurance scheme offered by Edelweiss Tokyo provides a cover of five lakh to 25 lakh rupees. Any person can choose the period of premium payment ranging from five to 40 years. Under the simple life insurance policy offered, if a non-smoker male 30-year-old man takes 25 lakh cover for 30 years, then he will have to pay a monthly premium of Rs 727. At the same time, when comparing it with the company’s current term plan Zindagi +, a monthly premium of Rs 390 has to be paid. A company spokesperson said that the premium rate for an insurance product has been determined on the basis of targeted mortality. However, this new product and we do not have data in it yet. Therefore, we will decide the premium based on the data available in the coming time. That is, it is possible to change it further. Edelweiss expects this insurance product to be purchased by those with a high probability of mortality..
So premium cost more
Explaining the reason behind the high pricing, Mahavir Chopra, of course.Orji’s founder (a research platform for insurance users) stated that no filter has been allowed in this new product from IRDA’s oer. Insurance companies use buyers’ demographics, income ranges, place of residence, occupation and level of education to determine the premium of a product. However, no filters are allowed in simple life insurance. Hence the premium of this product is expensive.
Will serve as initial term plan
Insurance experts say that Saral Jiban insurance plan will serve as the initial term plan. At present, the minimum cover in term plans is Rs 25 lakh and the term duration is at least 10 years. Currently no insurance plan offering 5 lakh cover is available in the market. For this reason, it is more expensive for insurance companies to become 5 lakh cover plans than 25 lakh covers.
Suitable for first time insurers
In Edelweiss Tokyo simple life insurance plan, a cover of Rs 5 lakh will have to pay a premium of Rs 145 per month for a policy term of five years. Insurance experts say that it will be very easy for people who have not yet taken insurance and are going to buy insurance for the first time. However, a person with good educational qualifications and a job will get regular term insurance plans cheaper than basic life insurance.
Relief to health insurance holders
Insurance regulator IRDA has given a big relief to health insurance holders and has instructed insurance companies to pay cashless treatment of Kovid as per the terms of the policy. Along with this, the regulator while giving concession to the insurance companies said that if it wants, it can compromise with the healthcare provider regarding the cost of treatment.
