CustBase » Life Insurance

Insurance portfolio … Think about it

admin — Mon, 07 May 2012 03:24:51 +0000

When you’re building your portfolio, you may not think about adding a life insurance policy. But it’s NOT TOO late. Life insurance can be a valuable addition with many benefits. You should have enough life Insurance to protect your family and loved ones.

What you need to look when building your Insurance portfolio has been discussed below.

Few of the features which you need to think, we have included below:

Liquidity of the death benefit

Since death benefit will be paid in cash when you pass away, it’s a liquid asset that can be accessed quickly by your beneficiaries.

Easy distribution

It can be split among any number of heirs. Ensure you have nominee represented in your policy document, else it would be a big fight and result in delay.

Predictable value

Since some types of life insurance earn cash value on a predetermined schedule, you can predict the value of your policy at any future date. With IRDA getting strict on the policies being issued by providers, we know what would be the minimum return.

Stability

When life insurance is a guaranteed product, the value of the death benefit isn’t affected by the economy or changes in the stock market

Tax advantages

Cash(Bonus) values in a life insurance policy grow tax deferred, and beneficiaries receive the death benefit income tax free (and estate tax free, too, if properly structured).

Keep in mind that only endowment insurance policies are considered assets, since they are the only policies that have cash value.

Talk to your insurance professional about whether adding more life insurance would make sense as a part of your portfolio.

Keep in mind that as your life changes (for example, marriage, birth of a child or a job promotion), so will your life insurance needs. Make sure your life insurance policy suits your long-term needs. You should weigh any associated costs before making a purchase.

Life insurance has fees and charges including costs of insurance that vary based on the insured’s gender, heath and age. There are additional charges for riders that customize a policy to fit your individual needs.

Specific premium requirements must be met to be eligible for death benefit guarantees. Please see the contract for details or check with your Life Insurance agent.

Educational website for Policyholders

admin — Thu, 03 May 2012 16:29:08 +0000

The Insurance Regulatory and Development Authority has been taking a series of initiatives under the Bima Bemisaal logo for creating awareness about insurance. The objective of having an exclusive website is to educate consumers about insurance, in particular, regarding Buying Insurance, Making a Claim etc.

The website is an attempt to reach out to all to give certain basic generic information on the subjects in order that consumers begin to think and seek answers to questions such as what they need to buy, whether they are being offered the right product, that they must read the insurance policy fully, understand procedures and documentation involved in making a claim etc. The attempt has been to keep the language simple so that a layman can understand it.

The website can be accessed at www.policyholder.gov.in and do leave feed back if any questions or want to know more about.

Please have your response on or before 21st May, 2012. You may send an e-mail to ypriyab@irda.gov.in

We shall wait to see more of this type and information from IRDA.

ING STAR Life – Enjoy Guaranteed Benefits

admin — Thu, 12 Apr 2012 19:43:37 +0000

ING STAR Life is a limited pay, non-participating and non-linked endowment plan which provides guaranteed additions for the entire policy term. This plan is best suited for anyone who is looking for guaranteed returns.

ING STAR Life guarantees the annual additions right from the start of the policy. You pay premiums for just 3 years and get to enjoy full benefits for the entire term of 12 years. Even to better that, with ING STAR Life you do not need to wait till the end of policy term to receive the benefit as Guaranteed Survival Benefit starts from 10th year itself.

Eligibility

Minimum / Maximum Age at Entry	8 years / 60 years age last birthday
Minimum / Maximum Maturity Age	20 Years / 72 years age last birthday
Policy Term	12 Years
Premium Paying Term (PPT)	3 Years
Minimum Annual Premium	Rs. 25,000
Minimum Sum Assured (Rs.)	Rs. 65,000
Maximum Sum Assured (Rs.)	Rs. 50,00,000 (Subject to underwriting)
Premium Mode	Annual only

Terms used in the Plan

Guaranteed Death Benefit: In case of the unfortunate demise of the policy-holder at any time during the policy term, 5 times the annual premium excluding service tax and premiums for extra mortality rating (if any) will be paid to the nominees/beneficiaries.

Guaranteed additions: With this plan you get guaranteed additions for the entire policy term and the rate of guaranteed additions varies with chosen Sum Assured. The guaranteed additions will be calculated on the sum assured on simple basis (not compounded). The rate of Guaranteed Additions is fixed for the entire policy term of 12 years.

Guaranteed Survival Benefit: With ING STAR Life, you don’t have to wait for the end of policy term to receive the full policy benefits. Guaranteed Survival Benefit is equal to sum assured and is paid to you in two equal installments

Guaranteed Maturity Benefit: The guaranteed maturity benefit is paid to you at the end of the policy term and is equal to the sum of all guaranteed additions.

Benefits of ING Star Life

Guaranteed Death Benefit of 5 times the annual premium.
Attractive Guaranteed Additions from 8% to 10% per annum for the entire policy term.
Guaranteed Survival benefits in the 10th and 11th year.
Premium commitment for only 3 years.

Death Benefit : A guarantee of 5 times the annual premium is paid to the nominee.

Guaranteed additions : This is a guaranteed fixed interest rate (Simple) which is paid based on the sum assured. The higher the Sum Assured, the %age of return is more. The maximum interest rate that can be availed is 10.00% on the sum assured. Below information explains.

Sum Assured	Guaranteed additions rate (p.a.)
65,000 to Less than 1,30,000	8.00%
1,30,000 to Less than 1,95,000	9.00%
1,95,000 to Less than 2,50,000	9.50%
2,50,000 and above	10.00%

Survival Benefit: ING Star life policy is for a short period of 12 years, the survival benefit starts to pay during the 10th and 11th year. 50% of the Sum Assured is paid during the 10th year and 50% paid during the 11th year. On the last year (12th year), you receive Guaranteed Maturity Benefit.

End of policy year	Guaranteed Survival Benefit payable
10	50% of Sum Assured
11	50% of Sum Assured

Premium

Premiums for ING Star Life is done backward, meaning to say you first decide on the Sum Assured, and then based on SA value premium is calculated.

Sample illustration of the plan based on different Sum Assured is shown below.

Age at entry(Years)	Sum Assured	Annual Premium#	Guaranteed Death Bnefit	Guaranteed Additions Rate	Guaranteed Survival Benefit End of 10th year	Guaranteed Survival Benefit End of 11th year	Guaranteed Maturity Benefit
35	65,000	25,338	1,26,688	8.00%	32,500	32,500	62,400
35	1,30,000	50,675	2,53,377	9.00%	65,000	65,000	1,40,400
35	1,95,000	76,013	3,80,065	9.50%	97,500	97,500	2,22,300
35	2,50,000	97,453	4,87,263	10.00%	1,25,000	1,25,000	3,00,000

Loan

You can avail a policy loan as eligible after paying the premium for two full years and after completion of 2 policy years.

Income Tax Benefit

ING STAR Life qualifies for Income Tax Benefits under section 80C and section 10 (10D) of the Income Tax Act, 1961, subject to provisions contained therein.

U/S 80C of the Income Tax Act 1961 on your premiums.
U/S 10 (10D) of the Income Tax Act 1961 on the maturity proceeds of your policy.

Overall

We recommend this product, due to the nature of the return. A return of 8% if considering the minimum sum assured opted. No tax on maturity, Life Insurance is covered. Another way of doing a single premium, but actually u pay the premiums in 3 years rather than running thru for the entire policy years.

Retire Rich – Retirement Plan from Bajaj Allianz

prakash — Tue, 27 Mar 2012 17:18:48 +0000

Bajaj Allianz CashRich Insurance Plan is a Carefree retirement plan which requires your attention now. A VERY GOOD retirement plan which allows peace of mind once retired. Not only that, it also ensures that your dependants are financially secure.

This is a very good product from Bajaj Allianz, and if looking for retirement cum pension plan , we say YES to this plan.

Features of Bajaj Allianz CashRich Insurance Plan

Key features of the plan are

Get cash benefit in three tranches

Accumulated compound reversionary bonus on completion of premium payment term.
Cash Back benefit of 5% of the sum assured plus cash bonus, if any declared every year, during the cash back period
Sum Assured plus terminal bonus, if any on maturity of the policy.

Flexibility to Select your policy term from 10 years to 65 years depending on your financial need.
Flexibility to Select your limited premium paying term (PPT) from 5 years to 30 years, in multiple of 5 only.
Flexibility to Pay your future premiums in advance and get benefit of appropriate discounts.

Option to Keep your policy in-force for full sum assured for a period of two years, even if you miss to pay your premiums on due dates, provided you have paid at least 3 year’s premiums in full.
Option to Convert your policy to a “single premium term cover with return of premium (ROP)” policy, if you miss to pay your premiums on duedates provided you have paid at least 5 years’ premiums in full.

Get more value for money with attractive high sum assured rebate

Optional riders to enhance your protection

How does Bajaj Allianz CashRich Insurance Plan work?

Bajaj Allianz CashRich Insurance Plan is a limited premium payment, participating, anticipated, endowment plan. The whole policy term consists of two phases; a premium payment term and a cash back period, both selected by you at the inception of the policy. At the end of the premium payment term, the accumulated compound reversionary bonus shall be payable to you, followed by the payment of Cash Back benefit of 5% of the sum assured plus the annual cash bonus (if any as declared by the company), at the end of each policy year, till the end of the policy term. On maturity of your policy, full sum assured plus the terminal bonus, if any, is also payable to you.

In case of unfortunate death of the life assured during the premium payment term, the sum assured plus the accumulated compound reversionary bonus plus interim bonus, if any plus terminal bonus, if any, is payable to the nominee. On the happening of such death after the premium payment term but during the cash back period, irrespective of the Cash Back benefits paid to you before the death, the full sum assured plus the interim cash bonus, if any plus the terminal bonus, if any shall be payable to the nominee.

Bonus

The plan receives bonus, and there are 3 different type of Bonus the plan can accumulate. End of each year, the Company will announce bonus, and follow the guidelines as per IRDA.

Compound Reversionary Bonus

This is a regular bonus expressed as a percentage and is applied to the sum assured and the compound reversionary bonus amount already attached to your policy. The compound reversionary bonus, once declared, shall vest in the policy immediately, provided all due premiums till date have been paid and shall be payable as part of the death benefit or as survival benefit at the end of the premium paying term.

Interim Bonus

The Company may pay interim bonus as well for the policies, where any premium has been paid after the last
valuation date and the death benefit or survival benefit (at the end of PPT) becomes payable before the next valuation date.

Cash Bonus

After the premium paying term, the Company may declare a cash bonus as a percentage of the sum assured which will be payable along with the Cash Back benefits at the end of every policy year during the cash back period.

Terminal Bonus

If your policy has completed 10 years or more and all due premiums have been paid, the company may pay a terminal bonus as well on the termination of the policy due to death or maturity.

Eligibility

Minimum Entry Age	0 years (18 years for additional riders)
Maximum Entry Age	60 years (50 years for additional riders)
Minimum Age at Maturity	18 years
Maximum Age at Maturity	100 years
Premium Paying Term	5, 10, 15, 20, 25 & 30 years, (maximum premium payment ceasing age is 65 years)
Cash Back Period	5 to 35 years
Minimum Policy Term	10 years
Minimum Policy Term	65 years
Minimum Premium	Rs. 8,000 per Yearly Installment Rs. 4,000 per Half-yearly Installment Rs. 2,000 per Quarterly Installment Rs. 750 per Monthly installment
Maximum Premium	No Limit
Minimum Sum Assured	Rs. 100,000
Maximum Sum Assured	No Limit
Premium Payment Frequency	Yearly, Half-yearly, Quarterly and Monthly.

Riders

You can enjoy extra coverage by choosing the optional additional rider benefits at a nominal extra cost. The riders available with Bajaj Allianz CashRich Insurance Plan are:

Bajaj Allianz Supplementary Death Benefit (UIN : 116B002V01)
Bajaj Allianz Comprehensive Accidental Protection Benefit(UIN : 116C001V01)
Bajaj Allianz Family Income Benefit (UIN : 116B009V01)
Bajaj Allianz Critical Illness Benefit (UIN : 116C007V01)
Bajaj Allianz Hospital Cash Benefit (UIN : 116C008V01)

Benefits

Survival Benefit

At the end of the premium paying term, you will receive the accumulated compound reversionary bonus accrued during the premium paying term, provided your policy is in force or paid-up and has not been converted to a single premium term cover with return of premium (ROP)

Cash Back Benefit

At the end of each policy year, after the completion of the premium paying term, Cash Back benefit equal to 5% of the sum assured plus the cash bonus, if any, is payable till the end of the policy term; provided your policy is in-force or is paid-up and has not been converted to a single premium term cover with ROP

If the policy is paid-up or is in auto-cover, the Cash Back benefit will be 5% of the paid-up sum assured and any cash bonus as declared at the end of each policy year

No Cash Back benefit shall be payable in case your policy is lapsed or has been converted to a single premium term cover with return of premium (ROP)

Maturity Benefit

If your policy is inforce for full sum assured, then, on the maturity date you will receive sum assured plus the terminal bonus, if any, as maturity benefit. However, if your policy is paid up, then, the maturity benefit shall be the paid- up sum assured.

In case your policy is converted to a single premium term cover with return of premium (ROP), then, the maturity benefit shall be the single premium, as determined as on the date of such conversion.

Your policy shall be terminated upon payment of the maturity benefit.

Death Benefit

In case of unfortunate demise of the life assured during the premium paying term and provided all the due premiums have been paid, the company will pay the sum assured plus the applicable bonuses to the nominee.

In case of unfortunate demise of the life assured during the premium paying term but the policy is in auto cover period, the company will pay the sum assured plus the applicable bonuses to the nominee after deducting all the due but unpaid premiums with applicable interest.

In case of unfortunate demise of the life assured when the policy is paid-up, the company will pay the below mentioned death benefit to nominee :

Death during PPT

Paid-up sum assured plus the applicable bonuses

Death during cash back period

Paid-up sum assured plus the interim cash bonus, if any.

In case of unfortunate demise of the life assured after the premium paying term but during the cash back period, provided all due premiums have been paid, the company will pay the sum assured plus the interim cash bonus, if any, the terminal bonus, if any, to the nominee.

In case of unfortunate demise of the life assured after the policy has been converted to a single premium term cover with return of premium (ROP), the Company will pay the revised sum assured, i.e., the sum assured ascertained at the time of such conversion of the policy

No death benefit shall be payable in case the policy is lapsed.

Surrender Value

You will have the option to surrender your policy anytime after 3 years, provided at least 3 years’ premiums have been paid in full.The surrender value shall be higher of the Guaranteed Surrender Value (GSV) or the Special Surrender Value (SSV). The GSV is equal to 30% of the due premiums paid excluding the first year’s premium, premiums for all additional rider benefits, if any, and the extra premiums, if any. The SSV will be arrived at by multiplying the paid-up sum assured and the applicable bonus as on the date of surrender with the SSV factor. The SSV factors will be declared by the company from time to time

However, if your policy has been converted to a single premium term cover with return of premium (ROP), the surrender value shall be determined as mentioned below:

The surrender value will be the higher of the Guaranteed
Surrender Value and the Special Surrender Value with respect to the single premium term cover with return of premium (ROP)
The guaranteed surrender value will be 30% of the single premium (as determined as on date of such conversion to a single premium term cover with return of premium (ROP).
The special surrender value will be based on the special surrender value factor in respect of the single premium term cover with ROP, which will be applied on the said single premium. The factors will be declared by the company from time to time.

Tax Benefits

Premiums paid are eligible for tax benefits as per Section 80C of the Income Tax Act
Death benefit, maturity benefit and the surrender value are eligible for tax benefits as per Section 10(10D) of the Income Tax Act
Premiums paid in respect of the Comprehensive accidental protection, hospital cash benefit and critical illness benefit will be eligible for tax benefits as per Section 80D of the Income Tax Act

Termination of the Policy

This Policy shall automatically terminate on the earlier occurrence of either of the following events:

On full surrender of the policy.
On expiry of the revival period, if three full years’ premiums have not been paid.
On foreclosure, if the paid-up sum assured plus vested bonus is less 1,000.
On foreclosure, if the outstanding loan plus loan interest becomes equal to the surrender value available under the policy.
On the death of the life assured.
On the maturity date

Money Back Plan Comparision from AEGON Reliagre

admin — Sun, 25 Mar 2012 21:33:51 +0000

AEGON Reliagre has 3 money back plans which is currently active. With all three money back plans being sold in the market, and understanding and comparision of the plans is very important.

Money Back Plans from AEGON Reliagre

Money Back Plan
Money Back Plus Plan
Flexi Money Back Insurance Plan

Compare Money Back Plans

Eligibility

First of the comparision is to know about the eligibility conditions, am i eligible for this plan. Below is the comparision done between the 3 plans.

Benefits

The MOST important is the Benefits which a life insurance policy has. On understanding the benefits, a product can be availed and decision can be taken.

Almost all Life Insurance policy have got Maturity, Survival, Death, Surrender benefits. In a money back plan, there is another option Periodic Payment. The peridoic payment differs from plan to plan, and below is the comparision of the 3 different money back plans from AEGON Reliagre.

Premium

If comparing the premium of the 3 money back plans, Moneyback Plus plan is the best option to go with.

Overall Decision

Money back plan is a good option to go with. Remember it COST little more than regular life insurance plans. So, if you are willing to pay a 10-20% higher premium than an endowment plan then it is ok.

Only benefit, the money back plan pays at regular periodic intervals, which helps during time of difficulty.

But should i pay more premium to avail this feature? A question to be asked by self before going for any Money Back Plan.

Sahara Vatsalya-Jeevan Bima another Money Back Plan

prakash — Tue, 20 Mar 2012 19:26:55 +0000

Sahara Vatsalya-Jeevan Bima is a with profit endowment plan with added advantage of life cover upto maturity and educational benefit of four annual installments @ 20%, 25%, 25% and 30% of sum assured are payable at the end of each year during the last four consecutive years of policy term for the educational expenses of the nominated child to ensure the child’s safe future. It also provides financial protection against death during the term of the policy by paying sum assured along with attached bonuses on the death of life assured (parent) in lump sum and additional annual ‘Family Income Benefit’ installments each of 10% of sum assured commencing from the policy anniversary following the death of the life assured and upto commencement of educational benefit and thereafter four annual educational benefit installments @ 20%, 25%, 25% and 30% of sum assured are payable at the end of each year during the last four consecutive years of policy term.

Eligibility

Minimum Issue Age (parent) the Life Assured	20 Years (Nearer birthday)
Maximum Issue Age (parent)	50 Years (Nearer birthday)
Minimum Issue Age (Child)	0 year
Maximum Issue Age (Child)	12 Years (Nearer birthday)
Minimum Sum Assured	Rs. 1,00,000/-
Maximum Sum Assured	No Limit subject to underwriting
Policy Term under the plan is	22– Age at entry of child
Premium Paying Term	Same as the policy term.
Maximum Coverage Age (parent)	70 Years

Benefits

Maturity Benefits: If the policy is in force for full sum assured, attached bonuses will be payable at maturity and four annual installments of ‘Educational Benefit’ @ 20%, 25%, 25% and 30% of sum assured are payable at the end of each of the last four policy anniversaries respectively.

Death Benefits: If the policy is in force for full Sum Assured at the time of death of the Life Assured (the parent), following benefits will be payable to the nominee, and in case nominee (child) is minor to the appointee:

A lump sum payment of Sum Assured along with all vested bonuses is payable immediately on death of the life assured.
Annual installments of ‘Family Income Benefit’ each of 10% of sum assured commencing from the policy anniversary following the death of the life assured and upto 18 years of assumed age nearer birthday of named child on the anniversary following the death of the life assured.
Four annual installments of ‘Educational Benefit’ @ 20%, 25%, 25% and 30% of sum assured are payable at the end of each of the last four policy anniversaries respectively.

Tax Benefits

Premiums paid under the policy are eligible for Income Tax benefits under section 80C of the Income Tax Act, 1961.
The maturity proceeds including fixed money back annual installments payable and death benefits including family income benefit under the policy are not taxed as income of the policyholder or his successors under section 10(10 D) of the Income Tax Act, 1961.

Riders

Accident Benefit & Accidental Total & Permanent Disability Benefit Rider

Family Income Benefit

Sahara Vatsalya-Jeevan Bima provides financial protection against death during the term of the policy by paying sum assured along with attached bonuses on the death of life assured (parent) in lump sum and additional annual ‘Family Income Benefit’ installments each of 10% of sum assured commencing from the policy anniversary following the death of the life assured and upto commencement of educational benefit and thereafter four annual educational benefit installments @ 20%, 25%, 25% and 30% of sum assured are payable at the end of each year during the last four consecutive years of policy term.

Illustration

Let us assume Mr X, opted for this plan. Details as below.

Sum Assured: Rs.1,00,000
Entry Age of Life Assured : 35 years
Child’s Entry Age: 7 Years
Term: 15 Years
Mode: Annual

Mr X’s, annual premium is Rs.8069.00

AEGON Religare Flexi Money Back Insurance Plan

admin — Tue, 13 Mar 2012 19:26:19 +0000

This is the thrid Money back plan Aegon Religare has come up with. The previous two money back plans “AEGON Religare Money Back Plus Plan” and “AEGON Religare Money Back Plan”. “Flexi Money Back Insurance Plan” is the 3rd.

Flexi Money Back Insurance Plan has got 3 different policy terms of 14, 17 & 21 years with premium paying term as 10, 12 & 15 years. There is BONUS from the very first year and TERMINAL BONUS at the end of the term (maturity).

Eligibility

Minimum Entry Age	90 days completed; risk cover will commence after Life Assured attains 7 years last birthday
Maximum Entry Age	60 years last birthday for 14 yearsPolicyTerm; 58 years last birthday for 17 years Policy Term; 54 years last birthday for 21 years Policy Term
Maximum Maturity Age	75 years last birthday
Minimum Sum Assured	Rs. 1,00,000
Policy Term	14 years OR 17 years OR 21 years
Premium Payment Term	10 years OR 12 years OR 15 years
Premium Payment Mode	Annually, Half Yearly & Monthly

Features : Flexi Money Back Insurance Plan

Life cover continues even after the end of Premium Payment Term
Additional Accidental Death Benefit
Bonus accrues first year onwards
Inflow of income at regular intervals
Choice of three Policy Terms to suit your financial needs
In case of death during the Policy Term, 100% of Sum Assured along with accrued bonus paid
You will get periodic survival benefits (Survival Benefits)
Policy Loan Available

Benefits : Flexi Money Back Insurance Plan

Maturity Benefit

At the end of the Policy Term, you will be entitled to receive 40% of Sum Assured i.e. last periodic survival benefit for inforce policies or 100% Paid-up Sum Assured for policies under Paid-up status, as applicable with the simple reversionary accrued bonus.

Death Benefit

In case of your unfortunate demise, the nominee receives the Sum Assured or Paid-up Sum Assured along with the simple reversionary accrued bonus and terminal bonus, if any, irrespective of the periodic survival benefits already paid and the plan ceases to exist.

If death occurs before attaining 7 years of age then the Death Benefit will be sum of all premiums paid irrespective of the periodic survival benefits already paid under the policy. In case of death due to an accident, the nominee receives an additional benefit equal to the Sum Assured. This benefit will be paid only if the age of the Life Assured at inception of the policy is 18 years & above.

Survival Benefits

You will receive certain percentage of sum assured as periodic survival benefit during the policy term. The below table provides details on when and how much will be received during the life of the policy.

Bonus

Simple reversionary bonus as percentage of Sum Assured every year provided the policy is in-force for full Sum Assured. Bonuses once declared form a part of guaranteed benefits of the plan. The bonus will be paid in case of maturity or on an earlier demise. The reversionary bonus is declared keeping in mind a long term view of investment returns, expenses, mortality and other experiences. Bonus will be declared at the end of every financial year and will be credited on subsequent policy anniversary. Bonus will only accrue if the first three years premiums have been paid. The bonus at the end of third year will include the bonus declared in previous three years.

Tax Benefit

Tax benefits are available as per the prevailing tax laws. (please read our article related to Insurance TAX)

Surrender Benefit

Firstly, try not to surrender your policy, until it is mature. If you want to surrender your policy, then policy will acquire guaranteed Surrender Value on payment of 3 full years’ premiums and Surrender Value will be paid after the completion of 3 years.

Loan on the Policy

Loan is available from the 4th policy year. The minimum amount of loan available under this policy is Rs. 5, 000 and maximum amount is not more than 60% of the Surrender Value.

Premium rates

A 25 year old opting for Sum Assured of Rs 500000.00 with a policy term 21 years, and premium payin gterm of 15 years has to shell out Rs 10258 per year.

Policy term : 21 years
Perium Paying term: 15 years
Sum Assured : Rs. 500000.00
Age: 25 years

Premium to be paid: Rs. 10258.00 per year
Total Premium paid for 15 years: Rs. 153870

Periodical Survial Benefit:
On the completion of 4th year: Rs 50000.00
On the completion of 8th year: Rs 75000.00
On the completion of 12th year: Rs 100000.00
On the completion of 17th year: Rs 125000.00
On the completion of 21st year: Rs 200000.00

What is good about Flexi Money Back Insurance Plan?

Accidental benefit is in-built
Option to take Loan Against the policy
Bonus from first year

SBI Life – Annuity Plus Pension Plan

prakash — Wed, 07 Mar 2012 19:29:37 +0000

SBI Life – Annuity Plus, a traditional, non-participating immediate annuity plan, which offers you a comprehensive range of annuity options along with inbuilt flexibilities, providing you an opportunity to always maintain your standard of living. It also gives you complete freedom to indulge in life’s necessities without any compromises!

Below is the list of Annuity options, further down, we have details for each one of them.

Eligibility

Age Limits	Minimum age at entry 40 years Maximum age at entry: 80 years
Annuity Payout (per installment)	Minimum : Monthly: Rs.200, Quarterly: Rs.600, Half-yearly: Rs.1,200, Yearly: Rs.2,400 Maximum: No limit
Annuity payout mode	Monthly, Quarterly, Half-yearly or Yearly
Premium Amounts	Minimum : Such that the minimum annuity installment can be paid Maximum : No Limit

Annuity Options — Life Annuity (Single Life):

Lifetime Income

Annuity is payable at a constant rate throughout the life of the Annuitant.
On death of the Annuitant, all future annuity payouts cease immediately.

Lifetime Income with Capital Refund

Annuity is payable at a constant rate throughout the life of the Annuitant.
On death of the Annuitant, all future annuity payouts cease immediately and the premium is refunded to the nominee.

Lifetime Income with Capital refund in parts

Annuity is payable at a constant rate throughout the life of the Annuitant.
At the end of seven years, 30% of the premium is paid to the annuitant on survival.
On death of the Annuitant the below 2 options

- Death beyond seven years: We will refund 70% of the premium to the nominee.
- Death within seven years: We will refund 100% of the premium to the nominee.

Lifetime Income with Balance Capital Refund

Annuity is payable at a constant rate throughout the life of the Annuitant.
On death of the Annuitant, we will refund the balance capital which will be equal to the premium paid less sum total of annuities paid. If this balance is not positive then no death benefit is payable.

Lifetime income with Annual Increase of 3% or 5%

Annuity payout increases at a simple rate 3% or 5% p.a. for each complete year as per the option exercised and is payable throughout the life of the annuitant
On death of the annuitant, all future annuity payouts cease immediately.

Lifetime income with certain period of 5, 10, 15 or 20 years

Annuity is payable at a constant rate for a fixed period of 5, 10, 15 or 20 years, as per the option exercised; and thereafter annuity is payable throughout the life of the Annuitant.

Few scenario for the above annuity option – Lifetime income with certain period of 5, 10, 15 or 20 years

Scenario 1: If the annuitant dies within the pre-defined period of 5, 10, 15 or 20 years, annuity payouts will still continue to be paid to nominee till the end of the chosen period, thereafter the annuity payouts cease.

Scenario 2: If the annuitant dies after the pre-defined period of 5, 10, 15 or 20 years, the annuity payouts cease immediately on death of the annuitant.

Annuity Options — Life Annuity (Two lives):

The annuity payout will continue at a guaranteed rate, through-out the life of the annuitants. As an annuitant, you may choose any of the following life annuity options.

Life and Last Survivor – 50% or 100% Income

Annuity is payable at a constant rate till the primary annuitant is alive.
On the death of the primary annuitant, 50% or 100% of the last annuity payout will continue throughout the life of the surviving second annuitant. On the death of last survivor, annuity payouts will cease immediately.
If the second annuitant pre-deceases the primary annuitant, nothing is payable after the death of primary annuitant.

Life and Last Survivor – 50% or 100% Income with Capital Refund

Annuity is payable at a constant rate till the primary annuitant is alive.
On death of the primary annuitant, 50% or 100% of the last annuity payment will continue throughout the life of the surviving second annuitant.
On the death of last survivor, we will refund the premium to the nominee.

Riders Available

Accidental Death Benefit Rider

1. You have the option to add the Accidental Death Benefit Rider by paying an additional single premium.
2. In the event of accidental death of the annuitant/s during the rider policy term, a lump sum benefit will be payable to nominee. This benefit will be 12 times the initial annualized annuity amount, up to a maximum of purchase price of annuity. Further, the same would be rounded to the lower 1,000 multiple.
3. In case of joint life annuity, the Rider may be opted for, by the primary annuitant or by both the annuitants.
4. Both the annuitants opting for the rider will be eligible for a death benefit equal to 12 times the initial annualized annuity amount.
5. The rider premium will have to be paid separately for both the annuitants. An accidental Death is defined as traumatic death caused solely by external, violent, unforeseeable and visible means, occurring independently of any other causes and within one hundred and twenty (120) days of such trauma, proved to the satisfaction of the insurer.
6. The rider limits are as follows:

Age at Entry (as on last birthday)	Minimum – 40 years Maximum – 60 years
Rider term (fixed)	10 years
Minimum Sum Assured	Rs 25,000
Maximum Sum Assured	Rs 50,00,000

Tax Benefits

Tax benefits will be available as per the prevailing tax laws. All annuity payouts may be subject to income tax as per the law prevailing on the date of payout.

Illustration

Met Deferred Monthly Income Plan – Retirement

admin — Tue, 06 Mar 2012 23:09:45 +0000

Met Deferred Monthly Income Plan from MetLife guarantees a monthly income for you & your family during your non working years. You choose the monthly income that you want and we guarantee it. This Plan also provides for bonus payout every year till the end of the Policy term (or on death) thus ensuring you peace of mind.

Eligibility

Premium Payment Term	5/7 Years
Min. Age at entry*	18 years
Max. Age at entry*	55 Years
Max. age at maturity*	85 Years
Policy Term	20/25/30 Years
Min. Monthly Income	Rs. 4,000
Sum Assured	120 times the Monthly Income for Policy Term of 20 years 180 times the Monthly Income for Policy Term of 25 yrs 240 times the Monthly Income for Policy term of 30 years
Benefit Period	10/15/20 Years
* Age as on last birthday

Premium Calculation for Met Life Plans

Metlife Life Insurance premium calculations are easy. Click here

Benefits

Survival Benefits

On completion of 10 Policy Year till the policy maturity, subject to the Policy being in-force, you get.
Enhanced monthly regular income = Guaranteed monthly income chosen at the inception + (Accrued bonuses at the end of the 10th policy year / (Benefit Payout Period*12))}.

The monthly regular income commences from the monthly anniversary date that immediately succeeds the completion of the 10th Policy Year (i.e. completion of one month immediately after the completion of 10th policy year.

Also, you will get cash bonuses (if any) from 11th policy year till the policy term ends.

In case of the death of the Person Insured while receiving the Survival Benefit, the Enhanced Monthly Income will continue to be paid to the nominee till the maturity date.

Maturity Benefit

On attaining the maturity age, subject to the Policy being in-force, you will receive the last the Terminal Bonus, if any. This will be payable along with the final installment of the monthly regular income.

Simple Reversionary Bonus

The policy will be eligible for Simple Reversionary Bonuses on completion of three policy years and the declared bonus will be credited at the end of the policy year immediately following the date of declaration of bonus provided all the due premiums have been paid. The declaration of Simple Reversionary Bonus depends on the experience of the Company. The Simple Reversionary Bonus once declared stands attached to the policy benefits till the end of the 10th Policy Year. The reversionary bonuses accrued at the end of 10th Policy Year is amortised over the Benefit Payout Period and added to the monthly income chosen at inception. This forms the Enhanced Monthly Income as described above. The first payment of the Enhanced Monthly Income will commence from the monthly anniversary following the completion of the 10th Policy Year. Simple Reversionary Bonus will not accrue for lapsed policies.

Cash Bonus

Your policy will be eligible for Cash Bonus on completion of 10 Policy years and the declared bonus will be paid within 9 months following the completion of each financial year. No Cash Bonus will be paid for lapsed policies.

Terminal Bonus

The Company may also declare a Terminal Bonus at the time of Policy maturity or at the time of payment of last monthly income payment (in case of death claim, provided all due premiums have been paid. The Terminal Bonus is payable only after payment of last monthly regular income payment and the same is not guaranteed.

Death Benefit

In the unfortunate event of death of the Person Insured while the policy is in force, the nominee/beneficiary will receive:-

a) If the Death of the Person Insured occurs before the 10th Policy Anniversary:

24 times the Monthly Income under the policy plus all the accrued Simple Reversionary Bonuses will be paid immediately on death, as a lump sum. Monthly Income chosen at the inception will commence from the first monthly anniversary falling immediately after the date of the death and continue to be paid to the nominee for the next 10/15/20 years as chosen by the Policyholder. The Simple Reversionary Bonuses accrued after the death will be paid in lump sum at the end of the 10th policy Year The policy will also be eligible for cash bonuses which may be declared after the completion of 10th Policy Year.
The policy terminates with the disbursement of the last Monthly Income payout, along with the payment of Terminal Bonus, if any.

b)If the Death of the Person Insured occurs after the 10th Policy Anniversary:

24 times the Monthly Income under the policy will be paid immediately on death, as a lump sum. In addition the nominee will continue to receive the revised Monthly Income being under payment under the Policy till maturity. On maturity, the nominee will receive the Terminal Bonus declared, (if any), along with the final installment of Monthly Income. The policy will also be eligible for cash bonuses which may be declared after the completion of 10th Policy Year.

The maximum period for which Monthly Income is payable is 120/180/240 months from the commencement of first Monthly Income payment – in case the Benefit Payout Period chosen is 10/15/20 years respectively.

Note: The Terminal Bonus (if any) will be payable along with the final installment of monthly regular income.

In case of death of the beneficiary / nominee during these guaranteed monthly regular income payments period, the due payments will be made to the legal heir. On death of the Insured, no further premiums will be payable by the beneficiary. Also, the participation in bonuses will be over and above the defined monthly payouts.

Reasons to go for the plan

Pay for 5/7 years to get Guaranteed* Monthly Retirement Income for upto 20 years from 11th year onwards
Your Guaranteed Monthly Retirement Income commences from Year 11 which is enhanced by the additional payouts* to boost your income.
Tax savings on buying along with Tax free Monthly Income
Immediate lump sum paid in case of an unforeseen event of death while guaranteed monthly income continues as planned for your family irrespective of the number of premium paid

Single Premium Life Insurance Plans – Suggestions

prakash — Sun, 04 Mar 2012 16:56:29 +0000

The main benefit of life insurance is to leverage funds to create an estate that can provide for survivors(family). Single-premium life (SPL) is a type of life insurance in which a lump sum of money is paid into the policy in return for a death benefit that is guaranteed to remain paid-up until you die/mature of the policy plan. Here we look at some of the different versions of SPL available, which offer a wide range of investment options and withdrawal provisions.

In other words, we pay a lump-sum money for a life Insurance policy, and do not pay any further. Then wait for the maturity and take the benefit.

What to look for Single Premium Life Insurance Plans

Living Benefits

Living Benefits meaning, what would i get on maturity of the plan. Is it worth going for a single premium plan, or pay year by year.

Investment Options

Think from an investment perspective, as you are paying a big sum amount, is it really worth it?

There are 2 types of investment options,
(i) You do not have the option to switch or control your funds, which is totally maintained by the Insurance company. This will give a year to year return at a fixed rate or higher.

(ii) The option for the policy holder to switch funds as per market conditions. In this, the policy owner takes decision and the Insurance company has no control of your investment options. But continues to cover your Life for the Sum Assured.

Withdrawal Options

As a policy owner, and making a single premium for a Life Insurance plan; you have the option to withdraw partial amount of the premium paid. But this withdrawal can happen only after first year completion. Remember this withdrawal is not FREE, but it is a loan given to you Insurance company.

Many individual go for this option, opting for Single Premium plan. Wait for couple of years an withdraw 70% of the investment done and invest somewhere else. And they continue paying the loan as a regular year to year premium.

This option is risky, and not all individuals have been successful, and a wrong decision would make you lose your life insurance and investment. As a thumb rule, DO NOT opt for withdrawal until very necessary.

Tax Treatment

As we all know, 90% of the individual buy life insurance for Tax Breaks. Apart from Insurance, there are other different options to invest. So in a given financial year, there is some percentage for Life Insurance premium and home loans, NSC, Infrastructure binds etc… But when a single premium life insurance premium is paid, it gives you options to take the tax breaks more in that financial year.

Also, remember maturity benefits from life insurance is NON TAXABLE, so the investment done today will be beneficial after 10/15/20 or more years.

Life insurance proceeds

Single premium policies will be taxed as income in the year it is received, assuming that premium exceeds 20% of the sum assured.

An insurance policy issued after 1st April, 2003 in respect of which the premium payable for any of the years during the term of the policy exceeds 20% of the actual capital sum assured will not be eligible for Sec 10(10D) benefit. This will not be applicable for any sum received on the death of a person.

The premiums in single premium plan sold with minimum sum assured always exceeds 20% of the sum assured and hence are likely to be taxable in the hands of policy holder at the time of maturity. One should be careful before buying the same.

Drawbacks

Many of you already are familiar with investments drawback. Similarly, here too, we have some drawbacks.

Investment Amount is High
No Riders available when Single Premium Life Insurance taken
Waiver of premium benefit is lost
If the Policy owner dies in between the term of the policy, you yet have paid the premium. And do not have the option to stop paying premiums
There will be medical exam if you try to invest with higher SPL value

Don’t have a steady cash flow to pay a premium every year.
If you are a regular traveler, making it difficult to pay your premium on time.
Availability of lump sum amount.
If you are a high income earner, you can opt for higher life cover

Benefits : Opting for Single Premium

After we have read above for the different what to know about Single Premium Policy, let us understand the benefits, and learn if it is really suitable to opt for.

Tax Benefit

Tax benefit is more in this case, as you DO NOT have to look out for other investments to get the tax break.

Premium Payment

You do not have to make regular premium payments, and chance of a policy lapse is NIL.

Reduced Premium Amount

A Life Insurance policy, if paid premium year on year, the premium cost is HIGH. A single premium gives you discount upto 40-45% on the same Sum Assured if paid year on year. So, if opting for Single Premium look out for this Benefit.

Age benefit

Lower the age, better it is to start with Single Premium. The premium i slow, and as said above reduced premium, premium payment will be very less.

NRI’s or High Net Worth

NRI’s and High Net Worth individual really like this option, as they earn more and it is an easy investment option for them.

Transferring Wealth with Life Insurance

Single premium life insurance is a valuable investment when it comes to wealth creation and transfer. With this type of life insurance, a single premium is deposited, creating an immediate death benefit that is guaranteed until the owner passes away.

Available Single Life Insurance Plans

Below we list few of the single premium plans from different Life Insurance providers.

LIC India

(i) LIC Jeevan Vriddhi
(ii) The Whole Life Policy- Single Premium
(iii) Bima Nivesh 2005
(iv) LIC Komal Jeevan
(v) Bima Bachat

HDFC Life

(i) HDFC Single Premium Whole of Life Insurance Plan

ICICI Prudential Life Insurance

(i) ICICI Pru iAssure Single Premium
(ii) ICICI Pru LifeGuerd Single Premium
(iii) ICICI Pru Wealth Advantage – Single Premium Plan

Bajaj Allianz

(i) Guaranteed Maturity Insurance Plan
(ii) Wealth Insurance Plan
(iii)Shield Insurance Plan
(iv) Flexi Advantage Insurance Plan

Birlasunlife

(i) BSLI Immediate Income Plan
(ii) Single Premium Bond
(iii)BSLI Foresight Plan

Metlife

(i) Met Vishwas
(ii) Met Smart One

Max Newyork Life

(i) SMART Steps Single Premium
(ii) Max NewYork Single Premium Bond insurance*

ingLife

(i) Single Premium Level Term plan
(ii) ING Prospering Life SP

sbilife

(i) SBI Life – Unit Plus III
(ii) SBI Life – Smart Performer

Reliance Life

(i) Reliance Total Investment Plan Series I
(ii) Reliance Life Insurance Classic Plan

Important Point to Note

When buying a Single Premium Life Insurance plan, ensure that you DO NOT exceed 5 time premium paid Sum Assured. As per Income tax section 10(10)(D),

“Income tax exemption on Maturity/Death Claims proceeds under Section 10(10D)”

Under the provisions of section 10(10)(D) of the Income-tax Act, 1961, Maturity/Death claims proceeds of life insurance policy, including the sum allocated by way of bonus on such policy (other than amount to be refunded under Jeevan Aadhar Insurance Plan in case of handicapped dependent predeceases the individual or amount received under a Keyman Insurance Plan) is exempted from income-tax. However any sum (not including the premium paid by the assessee) received under an insurance policy issued on or after the 1st day of April, 2003 in respect of which the premium payable for any of the years during the term of the policy exceeds 20% of the actual capital sum assured will no longer be exempted under this section.

The income tax rules on the other hand says that to claim tax deduction u/s 80-C, your insurance premium shall not be more than 20% of the actual sum assured i.e. life cover opted in the plan. This means if you are buying a policy of 1 lakh sum assured than your annual premium should not exceed Rs. 20,000. If your premium is higher than 20% than deduction shall be restricted to Rs. 20,000 only. On the other hand section 10(10)(D) says life insurance maturity value shall be tax free only if the premiums payable does not exceed 20% of the sum assured. It clearly means that if your premium is more than 20% of the sum assured that maturity proceeds shall not be tax free. The maturity amount automatically becomes taxable even it is received from life insurance company.

Life Insurance companies need to mention this in their product, so that every individual is aware of this.

Check with the Life Insurance company agent OR your tax Adviser.

ULIP or Traditional Single Premium Plans

This is really a tough question to answer, should i opt for ULIP or Traditional Life Insurance single premium plans. Every individual/adviser will have their own taught, but discussing this topic is worth.

If you notice the history of ULIP plans for the last 5 years, not many of them performed well. There are plans which require to pay premiums one time, of for the next 3-5 years. With the investment purely done to stock market, it is little risky.

If you look at traditional plans, single premium has better performed. And with Loyalty and Bonus, it makes a better choice over ULIP plans,

Note: This is the author’s view and decision has to be made by the investor after discussing with his/er tax adviser.