Payments to be made

This is given in the schedule of the policy under the head “Payments to be made and events on the happening of which they are to be made”. It provides clarity to the customer as to when he or his beneficiary is eligible for payments from the life insurance company. Generally, in this space a reference is given about the title of the Plan and other essential benefits provided by the contract. I am giving below an example:

20 year            Money back policy with profits + accident benefit

Death before date of maturity                         sum assured + vested bonus

Surviving 5 years from commencement        20% of sum assured

Surviving 10 years from commencement      20% of sum assured

Surviving 15 years from commencement      20% of sum assured

Surviving on date of maturity                          40% of sum assured + vested bonus

Two points to be understood here are (i) benefits are payable when all premiums are paid and policy is kept in force or when the policy attracts claim concessions as per rules of the life insurance company (ii) If death takes place before date of maturity full sum assured plus vested bonus will be paid, i.e. survival benefits paid before the death will be ignored. Accident benefit is payable when an accident takes place and as a result of it the life assured becomes permanently disabled or dies. Accident benefits, privileges and exclusions are given separately in the policy under the title ‘Conditions and privileges within referred to’. Bonus means share of surplus (profits of the life insurance company) that is allotted to with-profit policies.

Key words:

Life insurance
Schedule of policy
Policy bond
Payments to be made