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Knowledge Base Life Insurance Term Plan Reliance Term Plan Review
Friday, 21 January 2011 17:28

Reliance Term Plan Review

Written by  Yashish Dahiya
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Reliance Term Plan


Plan Name: Reliance Term Plan

Insurer: Reliance Life Insurance Company Limited

Category: Term Life Insurance Plan

Objective: Financial Protection of Family


Reliance Term Plan is a term life insurance which provides financial protection to your loved ones if something happens to you. You get comprehensive Sum Assured at comparatively low cost. If the policyholder passes away, Sum Assured will be paid to the nominee. Being a pure term life insurance plan, Reliance term plan has no maturity benefits.

 

Who can buy Reliance Term Plan?


Anyone above the age of 21 and not more than 60 years can buy Reliance term plan. The policy term ranges from 5 years to 30 years. The maximum age at maturity is 65 years.


How Much Cover:
Reliance Term Plan minimum Sum Assured is Rs 2, 50,000 and the maximum coverage will depends on your need. The maximum limit is subject to underwriting.

Don’t know how much cover you need?

Rule of Thumb: The typical cover should be ten times your annual income.

Summarized Table:

Entry Age

21 years - 60 years

Maturity Age

Maximum – 65 years

Sum Assured

Rs 25 lacs - unlimited( subject to underwriting)

Policy Term

5 years - 30 years

Minimum Premium

Rs 2000 per installment

Premium Mode

Yearly, Half Yearly, Quarterly

 

 

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What do I get?


Death Benefit: In the event of policyholders passing away (during policy term), the sum assured is paid to the nominee (parents, spouse or children).

Tax Benefits- Tax benefits can be availed under 80C and 10(10D) of the Income Tax Act, 1961.

80C- the yearly premium you pay (maximum: 1 lac) is deductible from taxable income.

10(10D) - Death claim is tax free. The Sum Assured which the nominee will receive is not subject to tax.

Inbuilt Waiver of premium: Under the circumstances that policyholder becomes permanently disabled, all the future policy premiums will be waived off and riders premium will be waived as per flowing details:

 

Accidental Death Benefit                                                                 Total & Permanent Disablement Rider

 

Age at entry

 

18 years

 

59 years

 

 

Age at expiry

 

25 years

 

64 years

 

 

Sum Assured

 

 

Rs 25,000

 

Rs 50,00,000

( Basic Policy Sum Assured to a maximum of Rs 50,00,000 per life)

 

 

Illustration:

Satish aged 32, to financially protect his family buys Reliance Term Plan with policy term of 25 years.

With yearly premium of just Rs 15199 he gets Sum Assured of Rs 40 lacs.

 

Consider these Scenarios:

Scenario1: Satish dies in the 9th policy year- Satish’s wife will get 40 lacs. Same is true for all policy years.

Scenario 2: Policy is in grace period and Satish dies, Sum Assured minus renewal premium will be paid.

Scenario 3: Policy lapses on the 22nd year, Satish dies, nothing will be paid. However policy can be revived within 30 days from the date of renewal.

 

RIDERS:


Riders are very useful additional benefits which could be beneficial to the policyholder. They are low priced but their utility is huge. The only thing is they can be added only at the commencement of the policy.  Riders available with Reliance term plan are:

 

Accidental Death Benefit (ADB): This rider is taken to get extra coverage in case death happens due to accident. The minimum Sum Assured in this rider is Rs 25000 and the maximum Sum Assured is Rs 50 lacs.
Total and Permanent Disablement: This rider comes into effect if the policyholder becomes permanently and totally disabled as a result of accident. The Sum Assured in this case is equal to the policy cover.


What Else?


How to buy: Contact Policybazaar and we will assist you in buying Reliance term plan without any snag.


Free Look Period: Reliance term policy can be cancelled within 15 days of receiving the policy contract. The policy document can be returned to the nearby branch along with letter of cancellation. The premium will be paid back minus some charges like medical examination, stamp duty.

Grace period: Reliance term plan premium can be paid within 30 days from the date of renewal. However in case of death during grace period; renewal premium will be deducted from Sum Assured payable. After the grace period, if the renewal premium is not paid the policy will cease to exist.

Reinstatement: Reliance term policy can be revived within 3 years from the premium due date. All the unpaid premiums plus relevant interest have to be paid to revive the policy.

Maturity: There are no maturity benefits since Reliance term plan is a pure term life insurance plan.

Payment Method: Cash, cheque subject to clearance, credit/debit card are accepted by Reliance.

Exclusion: During the first policy year or the year of reinstatement of policy, if policyholder commits suicide then Sum Assured will not be paid.

Death Claim: The nominee can apply for the death claim (Sum Assured) after filling claim forms along with submitting list of documents which will prove authenticity of the claim.

Close Competitors:


Aviva LifeShield Plus, Bajaj Allianz New Risk Care II, Bharti AXA Elite Secure, HDFC Term Assurance, Kotak PreferredLIC Amulya Jeevan-I, Met Suraksha Plus, Max New York Life Platinum Protect, Tata AIG Life Raksha.

 

Policybazaar take on Reliance Term Plan:


Reliance term plan is a nice term life insurance plan who’s major USP is waiver on premium unlike other insurance companies. Reliance term plan is inexpensive term life insurance plan which will fulfill your requirements. 

 

Compare with other term plans now!

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