You need to first get in touch with the insurance company to inform them about the policyholder's demise. After that, you will have to fill in the claim form properly and submit it with all the necessary documents. After this, the insurance company will provide you with the death benefits after completing the investigation and document verification processes.
Differences Between Sum Assured and Death Benefit
What is Sum Assured?
Sum assured is the amount that a nominee will get in case the insured individual dies within the policy’s terms. Policyholders determine this sum assured amount while taking the policy coverage.
It is a guaranteed amount that an insurance provider must give to a nominee in case the insured individual’s death comes under the inclusion criteria of the policy.
What is Death Benefit?
It is the total minimum amount that an insurance company must pay to nominees of policyholders if they die within the policy period.
The value of this benefit is variable. Death benefits may include bonuses, riders’ benefits, etc., in addition to the sum assured amount.
Sum Assured Vs Death Benefit
|It is a predetermined amount that an insurance company will have to provide to nominees in case of the sudden demise of insured individuals. So, it is also a death benefit.
|Death benefit is also the amount that nominees get after the death of a covered individual within the policy term.
However, its total value is not predetermined. This is because claimable amounts of additional benefits are variable.
|Sum assured amount is lower than the death benefit.
|Death benefits include the sum assured as well as additional bonuses. So, it is higher in amount.
Knowing these inherent differences between sum assured and the death benefit is important to understand the exact financial coverage your family gets under the policy. You should choose a suitable life insurance plan keeping their needs in mind.
FAQs about Sum Assured and Death Benefit
A life insurance plan's maturity benefit is an amount you will get after the end of your policy period. The insurance company directly pays this amount to the policyholder.
Following are some important documents that you will need to submit to claim death benefits:
- Original policy papers
- Death certificate
- Age proof of the policyholder
- ID proof of nominee
- Hospital records
- Medical certificate
You may have to submit a Police FIR and post-mortem report if the death is unnatural.
IRDAI mandates that insurance companies will have to pay a minimum death benefit, as mentioned below:
- If policyholders are below 45 years old, the minimum death benefit will be at 10 times of premium.
- If policyholders are above 45 years old, this benefit will be at least 7 times of premium.
Important Guides related to Life Insurance
- This is an informative article provided on 'as is' basis for awareness purpose only and not intended as a professional advice. The content of the article is derived from various open sources across the Internet. Digit Life Insurance is not promoting or recommending any aspect in the article or its correctness. Please verify the information and your requirement before taking any decisions.
- All the figures reflected in the article are for illustrative purposes. The premium for Coverage that one buys depends on various factors including customer requirements, eligibility, age, demography, insurance provider, product, coverage amount, term and other factors
- Tax Benefits, if applicable depend on the Tax Regime opted by the individual and the applicable tax provision. Please consult your Tax consultant before making any decision.