Life Insurance Corporation of India defines maturity benefit as the lump sum payment that is made available to the policyholder upon his/her survival of the policy term. Maturity benefit is essentially the Sum Assured payable along with accumulated guaranteed additions, terminal bonus, and vested simple reversionary bonus (if applicable).
If the policyholder of a certain policy outlives his/her policy term, he/she will be entitled to certain benefits from the insurer. These benefits are known as maturity benefits. The policyholder, however, can only claim the maturity benefits if he/she has paid the required premiums diligently and also if the policy is in force. Maturity claims are usually considered to be extremely hassle-free and they also require comparatively less paperwork.
What is a Policy Discharge Form?
A policy discharge form is nothing but an intimation form that is sent across to the policyholder by the insurance provider around one month before the date of maturity of the policy. The insurance company is required to be proactive in this regard as along with the form, the policyholder is also required to carry certain specific documents. The list of documents is provided with the letter along with specific instructions that the policyholder will be required to adhere to.
Documents and Other Details
The policyholder will be required to duly fill the policy discharge form after having read it thoroughly. Every small detail has to be accurately filled by the policyholder. Once he/she is done filling the policy discharge form, the policyholder will then be required to sign the same. The policy discharge form has to be signed by two separate witnesses as well according to rules specified by the insurance company.
Enclosing the following documents along with the policy discharge form is mandatory:
- Policy document - the original copy
- Proof of identity (copy)
- Proof of address (copy)
- Bank mandate form along with details of the bank
- Cancelled cheque
In order to carry out a smooth maturity claim settlement process, the policyholder will be required to send the policy discharge form along with the documents to the insurance company 5-7 days before the date of maturity of the policy. This will help the insurance company put everything together and release the claim amount at the earliest.
What is the Procedure?
The following process is usually carried out for a seamless maturity claim settlement:
- Upon receiving the policy discharge form along with the specified documents, the insurance company verifies the same.
- Once the verification is complete and the insurance company is satisfied with the result, the maturity claim will thereafter be processed.
- The bank of the policyholder is also intimated about the approaching transaction.
- The maturity claim proceeds are credited directly to the policyholder’s bank account once the date of maturity has passed.
- The policyholder receives the amount immediately after the procedure ends.
What are Some of the Noteworthy Points to Take Into Consideration?
- The above-mentioned process is applicable to those insurance policies that have encompassed maturity benefits such as survival benefits (maturity benefits) and bonuses.
- If the policyholder passes away any time after the date of maturity but before the procedures have been completed, the maturity claim is still paid to the family of the policyholder by the insurance company.
How is Maturity Computed?
With the advent of technology, accomplishing simple tasks has become hassle-free and less tiresome. Similarly, with the click of a button, it has become possible to calculate the maturity benefit that one is entitled to in an insurance policy.
Before one begins investment in any policy and starts paying the premiums for the same, an estimation may be set on the returns that he/she is entitled to. The maturity amount of any insurance policy, therefore, can be computed using an online calculator. A maturity calculator can be used to calculate maturity (returns) of endowment plans, children plans, single-premium plans, and so on.
Steps to Calculate Maturity Using an Online Maturity Calculator:
- The policyholder will be required to enter the sum assured amount of the policy he/she is currently holding.
- Other details required by the maturity calculator to calculate the maturity amount are year of purchase of the policy, current age of the policyholder, the policy term, full name of the policyholder, and his/her updated contact information.
- Once all the information has been filled in, the policyholder will lastly be required to click on ‘Calculate Maturity’.
- Upon clicking this button, the policyholder will receive the following information
- Maturity year
- Age at maturity
- Sum assured
- Total maturity amount
Maturity calculators provide effective ways to compute how much claim one is entitled to.