ICICI Pru iProtect Smart

Term life insurance provides financial protection to the nominee in case of any unfortunate event with the policyholder during the policy term. Term Insurance policies provide high life cover¹ at lower premiums.

Anyone with financial dependents should buy a Term Insurance Policy. This includes married couples, parents, business people and self-employed, SIP investors, young professionals with dependent parents, and in some cases, even retirees.

The right time to buy a term insurance plan is as soon as you can. The chances of getting lifestyle diseases increase as you age, and so do insurance costs. When you invest in a term plan at a young age, you get an insurance policy at an affordable premium. Hence, it may be advised to invest in term life insurance when you are young. This will save a lot of money in the long run.

We suggest, your term insurance cover should be about 10-12 times 13 your annual income. For e.g.: if you are earning ₹7.5 lakh per annum, you must secure yourself with a cover of about ₹ 75 lakh.

Additionally, you may also consider the following liabilities if applicable:

1. Loans & Liabilities
2. Children’s Education Cost

A simple rule of thumb for calculating Sum Assured in a Term Insurance policy is - Minimum Sum Assured = Annual Income x 10 times + Loans/Liabilities ¹⁴

The policy term offered by most life insurers ranges from 5 years to 40 years. One should always opt for a policy term depending on their retirement age. In India, 60 years is the general age of retirement

Term Insurance plans offer tax⁶ benefits on premiums paid up to ₹46,800 under Section 80C of the Income Tax Act, 1961. New-age Term Plans with critical illness cover also offer additional tax⁶ benefits on premiums paid up to ₹7,800 under Section 80D of the Income Tax Act, 1961. You also get tax⁶ benefits subject to conditions under Section 10(10D) of the Income Tax Act, 1961 on the money that your family receives in case of an unfortunate event.

A nominee is a person who receives the proceeds of your life insurance policy in case of your untimely death.

An appointee may be appointed to receive the policy money in case of death of the life assured while the nominee is still a minor. The appointee should be a major person.

The Death Benefit will be payable as per one of the below options chosen by Life assured at the inception of the policy and mentioned in the Policy Schedule.

1. Lump Sum Option - Entire Death Benefit amount is payable as lump sum.
2. Income Option - 10% of the Death Benefit amount is payable every year for 10 years. This will be payable in equal monthly instalments in advance at the rate of 0.83333% of Death Benefit amount. The beneficiary can also advance the first year.
3. Lump sum and Income - The part of the Death Benefit amount to be paid out as lump sum is chosen at inception. The balance Death Benefit amount will be paid out in equal monthly instalments in advance at the rate of 0.83333% per month over 10 years.
4. Increasing Income Option - Benefit amount is payable in monthly instalments for 10 years starting with 10% of the benefit amount per annum in the first year. The income amount will increase at 10% p.a. simple interest every year thereafter. For options 2, 3, and 4, the Life assured or the nominee as the case may be, will have an option to take the discounted value of the future payouts anytime during the payout term by informing us of this decision in writing. The present value will be derived using discount rate of 4% p.a..

The premium for a term insurance plan is calculated based on a number of factors. Various aspects of your health and lifestyle, such as your gender, age, habits, past or current medical ailments, hereditary diseases that are likely to affect you, and other aspects are considered before deciding upon a premium amount. (Final decision will be at the underwriter’s discretion).

Terminal Illness, as defined for ICICI Pru iProtect Smart, is a condition which, in the opinion of two independent medical practitioners specializing in the treatment of such illness, is highly likely to lead to death within six months. The terminal illness must be diagnosed and confirmed by medical practitioners registered with the Indian Medical Association and approved by the company. The company reserves the right for an independent assessment.

The minimum Critical Illness benefit³ you can choose is ₹ 1 Lakh and the maximum benefit is ₹ 1 Crore. The cost of medical treatment is continuously rising. So it is recommended to have a critical illness cover that is at least 2 times of your current annual income.

Limited Pay lets the customer pay off their entire premium in a limited period while enjoying the benefits of the plan for the entire policy term. This lets you free from the burden of paying premiums early on while keeping your family secured for a long period of time. While the premiums to be paid now are higher with Limited Pay, you can end up saving up to 68%15 on total premiums paid over the course of the policy.

Life insurance plans including Term Life insurance cover death caused due to health issues. This stands true for death caused due to Coronavirus as well. If an unfortunate event occurs with a person who has purchased ICICI Pru iProtect Smart policy due to COVID-19, his/her nominee will be paid the sum assured.