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Can a person have both, A PMJJBY and Term Plan ?

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18 Jun, 2021 by  Chiranjeev Patadiya

Can a person have both of these ?

A PMJJBY offered from bank and Term Plan from another insurance company? 

Will a bank accept the claim of PMJJBY if a person have separate Term Plan also?

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Term Life Insurance
Basics of Insurance

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19 Jun, 2021

Hi Chiranjeev,


The insurance companies have a formula to calculate Human Life Value (HLV) which is a multiple of your annual income. (Different for different age bands)


For eg:

18-35 : 20-25 times of your annual income

36-45: 15-20 times of your annual income

And so. The multiple reduces as the age band increases.


This is primarily done to ensure that the policies are not mis-used and the value of the human life is more when alive than dead.


So to answer your question, a person can have both the mentioned policies as well as multiple term policies as long as the total Sum Assured of all the policies combined is within the limits of the HLV calculation as per the person's age.


The total Sum Assured also includes any death benefit SA which might be a part of ULIPs, Money back policies, Endowment plans, etc... that the person might be having.


Hope this helps!


Cheers :)




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20 Jun, 2021
Chiranjeev Patadiya
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20 Jun, 2021
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20 Jun, 2021
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19 Jun, 2021

Dear Chiranjeev,


Life Insurance is a Fixed Benefit product. You can have more than one Life Insurance/Term Insurance policy subject to financial underwriting (Insurers give you a multiple of your total annual earned income in Life Cover). Ensure to declare about your existing Term Insurance to the new Insurer.


PMJJBY is a stock standard product linked to your bank account. If you have an active PMJJBY policy at the time of buying a term plan, disclose it in the proposal form. You should be fine after that.


Regards


Asad Akbar

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20 Jun, 2021
Chiranjeev Patadiya
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