SACHA ADVICE. ACHA ADVISOR.
back arrow Back

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

reply Share
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?

like like
0
Term Life Insurance
Basics of Insurance

3 Answer

Post
19 Jun, 2021
AVP Insurance - IDBI First Bank

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 :)




like like
0
icon-comment 3 Comments
icon-reply Reply
20 Jun, 2021
Chiranjeev Patadiya
like like
0
icon-reply Reply
20 Jun, 2021
AVP Insurance - IDBI First Bank
like like
0
icon-reply Reply
20 Jun, 2021
AVP Insurance - IDBI First Bank
like like
0
icon-reply Reply
19 Jun, 2021
Self Employed - Digital Consultant

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

like like
0
icon-comment 1 Comments
icon-reply Reply
20 Jun, 2021
Chiranjeev Patadiya
like like
0
icon-reply Reply
17 Feb, 2022
Anand Maskara

Dear Chiranjeev ji,

You can have multiple life insurance policies including term plans. While taking a new one, you should disclose all such policies running in your name. Second, 20 or 10 times of annual earnings is a thumb rule, which insurance companies don't follow strictly as they depend on profile of the person. With 5L income, you may be provided with 5 cr policy by different companies depending upon other aspects too. The only thing is to ensure that you have disclosed all the details correctly. And as a thumb rule as a customer, you should be having term insurance from several companies instead of one when going for higher sum assured (that should be 50L-1cr for each).

And while taking a term plan I shall suggest claim settlement ration is quite attractive but you should try to see (reference of near and dear ones) claim ratio of amounts you are looking for. For example, if you are going for a term insurance of 1cr and some companies are good in settling large no. of claims of 5-10L but create obstacles for higher sums, better avoid.

Third, when you move up in age bracket, 40+ that time you may think of Return of Premium option. Also just for the sake of buying do not buy a 99 year term plan. Better understand at what time you shall be in active life and till what time your family may be dependent on you. Take period of 5-10 years more, as you may have option to not pay after reaching your comfort zone. Simply means say I feel 65 is good for me, I shall take a term plan upto 75. At 65 I shall decide whether I shall like to be covered or not. So always advisable to go for regular pay.

Thanks.

like like
0
icon-comment 0 Comments
icon-reply Reply

Tired of dealing with call centers!

Get a professional advisor for life!

LIFETIME FREE

Rs. 1799

or

Discover the best tips for insurance every week!

Beshak is not regulated by the Insurance Regulatory and Development Authority of India (IRDAI) and does not have any alliance or association with any Insurance business.
© Copyright 2022 Beshak Solutions Pvt. Ltd. All Rights Reserved.

Disclaimer: The content on the website is purely for information purposes for the public at large, and does not constitute personal financial advice for a specific individual reader.
If you are reading this, it means you love reading the fine print. Why not get paid for what you love doing - Join us by writing to info@beshak.org now 🙂