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Reliance Nippon Life Digi-Term Insurance Plan

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Summary of Reliance Nippon Life Digi-Term Insurance Plan

Reliance Nippon Life Digi-Term Insurance Plan offers financial security to your family at affordable costs. This plan can be purchased online. You can enhance your cover at key milestones in your life. We will understand these benefits in detail with examples.
 
Plan Name Reliance Nippon Life Digi-Term Insurance
Policy Type Term Insurance
UIN 121N135V03

The V03 at the end indicates that this is the 3rd version of this plan. Earlier versions may have some small changes.

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Key Features of Reliance Nippon Life Digi Term Insurance Policy

  • Online term insurance plan which can be purchased within a short period of time 
  • High cover amount at affordable premiums
  • Option to customise your plan and to enhance protection at key milestones in your life
  • Premiums can be paid monthly, quarterly, half-yearly or annually
  • Tax Benefits on Premiums paid and Death Benefit


Benefits of Reliance Nippon Life Digi-Term Insurance Policy

This plan has 5 options to choose from. You can choose these options only at the time of purchase. We will understand these options in detail below.

Option 1 - Life Secure
In this option, the policyholder pays the premiums regularly and in case of the death of the policyholder or in case of being diagnosed with a terminal illness at any time during the policy term, the sum assured will be paid in lumpsum to the nominee and the policy stops.

There is no maturity benefit or return of premium at the end of the policy.
Example: Rohit who is 30 years old takes this plan for a 20 years policy term. His premium will be Rs. 7,215 per year for 1 crore cover amount if he is healthy and a non-smoker.
So he has this cover till the age of 50 years. In case of any unfortunate event of death or diagnosis of terminal illness within these 20 years, his nominee will receive Rs. 1 crore and the policy will terminate.


Option 2 - Enhanced Life Secure
In this option, the cover amount increases by 5% every year, to a maximum cover amount of 2 times the base cover amount. The policyholder pays the premiums regularly and in case of the death of the policyholder or in case of being diagnosed with a terminal illness at any time during the policy term, the last increased sum assured will be paid in lumpsum to the nominee and the policy stops.

The premium does not increase every year. There is no maturity benefit or return of premium at the end of the policy.
Example: Rohit who is 30 years old takes this plan for a 20 years policy term. His premium will be Rs. 9,906 per year for 1 crore cover amount if he is healthy and a non-smoker.
His cover amount will increase by 5% of 1 crore every year = Rs. 5 lakhs. Once the cover amount becomes 2 times, that is 2 crore, there will be no more increase and it will stay at 2 crores for the rest of the policy term. So in case of the death of Rohit after the 20th policy year, his nominee will receive Rs. 2 crores in lumpsum and the policy terminates.


Option 3 - LIfe & Income Secure (Level Income Benefit)
This option is good in case the policyholder wants to leave a regular monthly income for the nominee in addition to the lumpsum amount payable on death. In case of the policyholder’s death or in case of being diagnosed with a terminal illness during the policy term, the sum assured will be paid as lumpsum and a monthly income of 0.5% of the sum assured will be paid every month for the next 10 years.
Example: Rohit who is 30 years old takes this plan for a 20 years policy term. His premium will be Rs. 10,091 per year for 1 crore cover amount if he is healthy and a non-smoker.
So in case of the death of Rohit after the 20th policy year, his nominee will receive Rs. 1 crore in lumpsum. Additionally, his nominee will receive 0.5% of 1 crore, that is Rs. 50,000, every month for the next 10 years. 


Option 4 - LIfe & Income Secure (Increasing Income Benefit)
This option is good in case the policyholder wants to leave a regular monthly income for the nominee in addition to the lumpsum amount payable on death. In case of the policyholder’s death or in case of being diagnosed with a terminal illness during the policy term, the sum assured will be paid as lumpsum and a monthly income of 0.5% of the sum assured will be paid every month for the next 10 years. The monthly income increases at a simple interest rate of 10% every year.
Example: Rohit who is 30 years old takes this plan for a 20 years policy term. His premium will be Rs. 11,310 per year for 1 crore cover amount if he is healthy and a non-smoker.
So in case of the death of Rohit after the 20th policy year, his nominee will receive Rs. 1 crore in lumpsum. Additionally, his nominee will receive 0.5% of 1 crore, that is Rs. 50,000 every month in the first year. Then the monthly income will increase by Rs. 5,000 every. The monthly income will be paid for 10 years. 


Option 5 - Whole Life Cover
This is a whole life cover, which means the cover continues for the entire life of the policyholder  or in case of being diagnosed with a terminal illness. The premiums need to be paid only till the age of 65 years and the cover continues for the rest of his life.
Example: Rohit who is 30 years old takes this whole life plan.There is no specific policy term. His premium will be Rs. 54,527 per year for 1 crore cover amount if he is healthy and a non-smoker. He needs to pay the premiums till the age of 65 years.
So in case of the death of Rohit at any point of time, his nominee will receive Rs. 1 crore in lumpsum. He has to pay premiums till the age of 65 years.

The Sum Assured on Death on all these options is defined as:

Higher of –
  • 10 times of Annualised Premium
  • Absolute Amount Assured to be paid on Death
  • 105% of the Total Premiums Paid as on date of death

Optional Benefits - Riders

The following riders can be taken along with the plan with a payment of additional premium.
  • Reliance Nippon Life Accidental Death Benefit Rider - A sum equal to rider sum assured selected will be paid additionally, in case of death due to an accident.
  • Reliance Nippon Life Accidental Death and Disability Rider - A sum equal to rider sum assured selected will be paid additionally, in case of death due to an accident. In case of permanent disability, the rider sum assured will be paid in 10 equal instalments over 10 years.
  • Reliance Nippon Life Accidental Death and Disability Plus Rider -   A sum equal to rider sum assured selected will be paid additionally, in case of death due to an accident. In case of permanent disability, the rider sum assured will be paid in 10 equal instalments over 10 years and the future premiums need not be paid.
  • Reliance Nippon Life Critical Illness Rider - A sum equal to rider sum assured selected will be paid additionally, in case the policyholder is diagnosed with any of the 25 critical illnesses covered.

Enhanced Coverage Benefit
You can increase the cover amount on specific events during the term of the policy. You can avail this rider benefit by paying extra premiums. The increase can be as follows:
 
Event Additional Sum Assured
Marriage (1st marriage only) 50% (Max 50 lakhs)
Birth / Legal adoption of 1st child 25% (Max 25 lakhs)
Birth / Legal adoption of 2nd child 25% (Max 25 lakhs) 


You have to make this increase within 180 days of the event.
 

Eligibility Parameters for the Reliance Nippon Life Digi Term Policy

Parameter Whole Life Cover Option All other Options
Entry Age 25 to 60 years 18 to 60 years
Max Age at Maturity Whole life 33 to 80 years
Sum Assured 25 lakhs 4.99 crores
Policy Term Whole life 15 to 40 years
Premium Payment Term 65 - Entry age Same as policy term
Premium Payment Mode Monthly, Quarterly, Half-yearly, Annually
 

Other Features of Reliance Nippon Life Digi Term Insurance Policy

Freelook Period - In case you are not satisfied with the policy after receiving the policy documents, you can cancel the policy and get a refund. The can cancel the policy within the freelook period as defined here:
  • Within 15 days in case the policy is not purchased electronically or through distance marketing
  • Within 30 days in case the policy is purchased electronically or through distance marketing

Surrender Value - You can surrender the plan only in the case of the Whole Life Option. This can be done if 3 years of premiums have been paid. Surrender Value = 70% of Total Premiums Paid multiplied by (Maximum of 0 and (100 less Age at surrender) divided by (100 less Age at Entry))

Revival - In case you have missed the premiums and the policy has lapsed, you can revive the policy within 5 years from the last unpaid due date, but before the policy term expiry. You will have to pay all unpaid premiums without any interest.

Suicide Exclusion - In case of death of the polilcyholder due to suicide with 12 months of commencement of risk, the sum assured will not be paid to the nominee. Only a part of the premiums paid will be refunded as follows:
  • For regular premium plans - 80% of the premiums paid will be refunded  


This pretty much explains the working of this plan. In case you have any questions on this plan, please drop a comment and we will get back to you.

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