Commencement of risk cover:
The risk commences either after 2 years from the date of commencement of policy or from the policy anniversary immediately following the completion of 7 years of age of child, whichever is later.

Premiums:
Premiums are payable yearly, half-yearly, quarterly, monthly or through Salary deductions, as opted by you, up to the policy anniversary immediately after the life assured (child) attains 18 years of age or till the earlier death of the life assured. Alternatively, the premium may be paid in one lump sum (Single premium).

Guaranteed Additions:
The policy provides for theGuaranteed Additions at the rate of Rs.75 per thousand Sum Assured for each completed year. The Guaranteed Additions are payable at the end of the term of the policy or earlier death of the Life Assured.

Loyalty Additions:
This is a with-profit plan and participates in the profits of the Corporation’s life insurance business. It gets a share of the profits in the form of loyalty additions which are terminal bonuses payable along with death or maturity benefit. Loyalty addition may be payable depending on the experience of the Corporation.

Survival Benefit:
The percentage of sum assured as mentioned below will be paid on survival to the end of specified durations:

Death Benefit:
In case of death of the life assured before the commencement of risk, the policy shall stand cancelled and premiums paid (excluding the Premium for Premium waiver Benefit ) under the policy will be refunded. However, if death occurs after the commencement of risk but before the policy matures, the full Sum Assured plus Guaranteed Additions together with Loyalty Additions, if any, is payable.

Maturity Benefit:
The Guaranteed Additions together with Loyalty Additions, if any, is payable in a lump sum on survival to the end of the policy term.

Premium Waiver Benefit:
This is an optional benefit that can be added to your basic plan. An additional premium is required to be paid for this benefit. By payment of this additional premium, the proposer can secure the benefit of cessation of premiums from his/her death to the end of the deferment period. The deferment period for this purpose is to be taken as 18 minus age at entry of child.

Surrender Value:
Buying a life insurance contract is a long-term commitment. However, surrender value is available on the plan on earlier termination of the contract.

Guaranteed Surrender Value:
The policy may be surrendered after it has been in force for 3 years or more. The Guaranteed Surrender Value before the date of commencement of risk is 90% of the premiums paid excluding the premiums paid during the first year and any extra premium paid. After the date of commencement of risk, the Guaranteed Surrender Value is 90% of the premiums paid before the date of commencement of risk excluding the premiums paid during the first year and any extra premium paid plus 30% of the premiums paid after the date of commencement of risk.

Corporation’s policy on surrenders:
In practice, the company will pay a Special Surrender Value – which is either equal to or more than the Guaranteed Surrender Value. The benefit payable on surrender reflects the discounted value of the claim amount that would be payable on death or at maturity. This value will depend on the duration for which premiums have been paid and the policy at the date of surrender. In some circumstances, in case of early termination of the policy, the surrender value payable may be less than the total premium paid.

The Corporation reviews the surrender value payable under its plans from time to time depending on the economic environment, experience and other factors.

Life insurers, who see this as an exercise by the regulator to justify the huge delay in product approvals over the last two years, have formed a core group to help build consensus among all players and present a single paper to the regulator, contesting the issues raised by the regulator.

The key differences are over the IRDA suggestions including making premium paying term equal to the policy term, questioning the ‘heavy reliance on re-insurers for each and every product’ and the risk it carries should a reinsurer default, creating barriers for insurers in launching too many funds under one product, and over the suggestion to increase equity exposure for the guaranteed NAV products.

In a strongly worded letter, the regulator said, “Lately more complex products are being designed and filed for F&U (file and use) clearance with the IRDA… several of the products are not in alignment with the best practices and, frequently lack clarity. The efficiency of the product clearance has been constrained by such features.” At a meeting on Tuesday, the Life Insurance Council — the forum of insurers — decided to jointly draft a response to the regulator’s suggestions. Many said discouraging single and limited premium terms would impact their cash flow management for the companies.

They feel that flexibility of paying for a short term and getting cover for much longer term provides flexibility to the customers and that should continue. “There are many customers who want to pay for a shorter term due to high incomes at specific periods, for example actors. Why should we kill this flexibility?” a senior official of a life insurance company told The Indian Express.

The regulator has also questioned life insurers’ tendency to rely too much on re-insurers. “…such insurers only act as an insurance service provider than as a risk bearing insurer. This amounts to fronting,” it said. “IRDA can increase the reinsurance retention limit if it wants. Every company does its risk assessment and only after a set limit, passes the risk to re-insurer,” said Nageshwar Rao, MD & CEO IDBI Federal Life Insurance. Insurers in India are free to choose their reinsurers and the retentions and the reinsurers do not come under the regulatory ambit of IRDA.

IRDA has also suggested a minimum equity component in guaranteed NAV products. “How can an insurer take exposure to equity when there is an aggressive guarantee (of highest NAV)? The regulator should not push the industry to take unnecessary risk,” said Andrew Cartwright, Appointed Actuary, Kotak Life Insurance. The industry is already reeling under the pressure of a slew of changes in the last two years. A sharp cut in commissions has forced a large number of advisors to quit the business. “Almost three lakh advisors have quit. This translates into huge losses given the high training cost on agents. We need time to switch over to new ideas and adapt accordingly,” said Kamalji Sahay, MD & CEO, Star Union Dai-ichi Life Insurance.

Many companies feel it is not fair for the regulator not to approve products on grounds of being complex when similar products were approved earlier and exist in the market today. “Industry does not know how to go forward. The products already existing in the market must be stopped first rather than blocking approvals of those filed now. Regulator and the industry needs to resolve the issue quickly, create a level playing field and move on with the business,” says Amitabh Chaudhary, MD and CEO, HDFC Life

Pay 1000/- monthly and get 4,44,397/-

Pay 2000/- monthly and get 8,88,595/-

Pay 4000/- Monthly and get 17,77,587/-

Pay 5000/- Monthly and get 22,21,984/-

Pay 6000/- Monthly and get 2,20,26,610/-

Note : these plans are not based on market, these are

Purely traditional plans of LIC

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Female critical (FCI) benefit: a benefit equal to the S.A. (subject to a maximum of Rs.2Lacs, will be available on the occurrence of any of the following critical Illnasses. Breast cancer; ovarian/ fallopian tube cancer; cervical cancer; uterine cancer; vaginal/ vulval cancer

Congenital disability benefit (CDB): if a child born to the policyholder, suffers from any of the congenital disabilities listed below, a benefit equal to 50 % of the S.A. (subject to a maximum of Rs.1Lac) will be available for two children. Conditions apply. The list of congenital disabilities: downs syndrome; spina bifida; Tetralogy of fallot; oesophageal atresia & tracheo-oesaphageal
Fistula, anal atresia, imperforate anus, cleft palate with or with or without cleft Lip.

Paid-up/ Guaranteed special surrender value: it is eligible after the expiry of 3 yrs. If the premium have been paid fully.

Plan parameters
Age at entry: Min.18 yrs Max. 50 yrs
Maturity age: Max. 70 yrs
Term allowed: 15 & 20 yrs
Sum assured: Min.50,000 Max.25 Lac
S.A. in multiples: 5,000
Mode of payment: YLY only
Accident benefit: Rs.1 extra per
(Max. 50 Lac inclusive 1000 SA
All plans)
Policy loan: N.A.
Housing loan: N.A.
Assignment: yes
Revival: yes
Surrender of policy: yes
Term rider: N.A.
CIR: N.A.

Underwriting condition
Form no: 300+ addendum
Age proof: std/NSAP-1
Female lives category: I/II/III
Medical exam: must (female medical examiner only)
Actual sum assured: 1.5 times SA
Risk coverage: SA+GA +Bonus (bonus after 1st 5 yrs)
Dating back @ 8%: Allowed

BENEFIT
Survival benefit: 20% of the S.A. at the and of 5/10/15 years for 20 years term (balance payable on maturity plus guaranteed addition plus bonus if any)

Maturity benefit: for policy term of years: 60% of the S.A. + G.A and bonus after 1st yrs. As declared, will be paid.

Death benefit: on death within the 1st policy years S.A.+G.A will be paid on death after 5 policy years S.A.+ G.A.+ Bonus, if any irrespective of all earlier survival benefit paid is payable.

Example: Mrs. Ambani aged 30 yrs. Is a working woman. she opts for jeevan bharati plan for term 20 yrs. And SA Rs.2 Lac She pays an annual premium of Rs.14910. after 5,10,15 years each she will get 20% of S.A. i.e. Rs.40,000. at the end of 20 yrs. She will get Balance S.A. + G.A Bonus if any i.e. Rs.80,000 +50 x 20 x 200 (bonus assured as 50 per 1000 SA)
= 80,000 +1000 SA terminal bonus, if any
= 2,80,000+ terminal bonus, if any

on death after 4 years her nominee will get S.A + G.A
= 2,00,000 + 50 X 4X 200
= 2,00,000 + 40,000
= 2,40,000 + Terminal Bonus, if any.