Child Plans: SBI Life Scholar II or Aviva Young Scholar Secure

A child plan is a type of life insurance plan which lets you earmark a portion of savings towards future of children be it education or marriage. A child plan also provides risk coverage.

Type:

Both are traditional plans which imply guaranteed returns. However growth rate on investment in traditional plans is low.

Age Eligibility:

SBI Life can be bought by parents aged between 18 years and 60 years. The maximum maturity age should not exceed 70 years.

Aviva Young Scholar Secure can be bought by parents aged between 21 years and 50 years. The maximum age for parent at maturity of policy should not exceed 71 years.

Life Cover:

The maximum Sum Assured for SBI Scholar II is Rs 1 Cr. The maximum cover allowed for Aviva Young Scholar Secure depends on age of parent, child and plan variant taken.

Policy Term:

The policy term for SBI Life Scholar II is between 6 years and 21 years. The policy term for Aviva Young Scholar II is between 9 years and 21 years.

Maturity Benefit:

The payout is made in four installments, begins when the child turns 18 and continues till age of 21. The payout is equal to 25% of Sum Assured. Final payout has vested bonuses too.

Aviva Young Scholar Secure  payout is made in 3 phases- initially tuition fees is paid for few years, then one time college admission fee is paid and finally when the child turns 21, higher education reserve becomes payable. The amount for the payouts depends on Sum Assured.

Inbuilt Risk Coverage (Death Benefit):

A child plan should have extensive risk coverage so that child future remains unaffected.

Some features are specific to child plans. These benefits increase financial security and are inbuilt.

SBI Smart Scholar has 3 such benefits which are applicable on death of life insured. Sum Assured along with vested bonuses is paid immediately. The future premiums are waived off and four installments equal to 25% of Sum Assured becomes payable when the child turns 18 till age of 21.

In Aviva Young Scholar Secure, on death of life insured, Sum Assured is paid immediately. The future tuition fees, college admission fees and higher education reserve will be paid as per the original schedule.

Riders:

Riders are means to increase financial security with life insurance plan and can be added to base plan by paying additional premium amount. SBI Young Scholar II has the following riders- Critical Illness rider, Accidental death and permanent disability, premium waiver benefit rider.

The riders available with Aviva Young Scholar Secure are Accidental Death Benefit, term plus rider and dread disease rider.

Premium Payment Modes:

Both single premium (one time) and regular premium paying modes are available with SBI Life Scholar II. In regular premium paying mode, you can pay annually, semi annually, quarterly and monthly.

The premium payment frequency with Aviva Young Scholar Secure is yearly, half yearly and monthly.

Conclusion:

Both SBI Young Scholar II and Aviva Young Scholar II have comprehensive risk coverage. Both have riders available to extend the risk coverage. The difference among the two is that Aviva child plan payouts begin earlier whereas in SBI child plan, payouts begin when the child turns 18. Also SBI Life Scholar II also pays bonuses which are not a part of Aviva Young Scholar Secure.

Insurer: Life Insurance Corporation of India

Category: Traditional Plan

Objective: Financially Securing Child’s Future

Loyalty Benefits

Accidental and Critical Illness Rider

Large Sum Assured Rebate

Eligibility of LIC Jeevan Ankur

Minimum Entry Age: 18 Years (Parent) 0 Years (child)

Maximum Entry Age: 50 Years (Parent) 17 Years (child)

Maximum Maturity Age: 50 Years (Parent)

Policy Term (minimum): Higher of (18-age of child, 8) Years

Policy Term (maximum): (25- age of child) Years

Minimum Sum Assured: 100,000

Maximum Sum Assured: No limit

Premium Payment Frequency: Yearly, Half-Yearly, Quarterly, Salary Deduction

At the end of policy term, basic Sum Assured along with loyalty additions will be payable.

Death Benefit:

On death of life insured, basis Sum Assured becomes payable and annual benefit equal to 10% of Sum Assured is paid on policy anniversary till the end of term.

Loyalty Additions:

On maturity, non-guaranteed loyalty additions are added to the total policy amount.

Riders:

The following 2 riders can be opted with LIC Jeevan Ankur child plan:

Accidental Benefit Rider: This rider pays additional Sum Assured opted under the rider if the life insured death occurs as a result of accident.

Critical Illness Rider: If life insured is diagnosed with certain critical illness, the Sum Assured opted under the rider will be payable.

Sum Assured Rebate:

Under Section 10(10D) death claim is completely tax free.

Surrender Value: In case you want to cancel Jeevan Ankur after 3 years, the guaranteed surrender value is 30% of all premiums paid excluding the first year premium.

Free Look Period: Jeevan Ankur plan can be cancelled within 15 days of receiving the policy contract. A written application can be submitted to any branch for the same. The premium will be paid back minus some charges like stamp duty, medical reports.

Insurer: AEGON Religare Life Insurance

Category: Traditional

Objective: Financially Securing Child’s Future

Bonus

Accidental Rider Available

Loan facility

Discount

Maximum Entry Age:  63 Years

Maturity Age: 75 Years

Policy Term: 12/16/20 Years

Premium Payment Term: 8/12/16 Years

Premium Payment Frequency: Yearly, Half Yearly, Monthly

In the last four years of the policy term, 50%, 25%, 25% and 20% of Sum Assured will be paid respectively. On maturity, bonuses will also be paid.

Bonus:

These will be added every year depending on the performance of the company and will accrue only if first three year premiums have been paid.

Death Benefit:

Option 1: On death of life insured during policy term, Sum Assured with bonuses will be paid. The maturity benefit as per the set schedule will also be payable.

Option 2: If life insured passes away during policy term, Sum Assured with bonuses will be paid. The maturity benefit as per the defined schedule is also payable. Additionally 10% of Sum Assured will be paid every year till the end of premium paying term.

High Sum Assured discount:

For Sum Assured equal and above Rs 5 lacs, rebate on premium will be given.

Riders:

Accidental death, dismemberment and disability rider can be opted with the plan.

Loan:

You can apply for loan from the 4^th policy year. The maximum loan amount cannot be more than 60% of surrender value.

Under Section 10(10D) death claim is completely tax free.

Surrender Value: In case you want to cancel Educare after 3 years, the surrender value will be paid.

Free Look Period: Educare plan can be cancelled within 15 days of receiving the policy contract. A written application can be submitted to any branch for the same. The premium will be paid back minus some charges like stamp duty, medical reports.

Life Insurance: Beginner’s Guide

In simplest terms, life insurance is a financial product which provides risk cover to human life. That is, on demise of the individual within the policy term, a lump sum amount is made available to the family members of the individual for their future financial needs.  Over the years, life insurance has evolved into a much broader product with investment options and riders to increase financial security.

Life Insurance is a mutual agreement between two parties- insurer and the insured. Insurer is the financial company which is providing the risk cover and insured is the individual whose life is covered. The insured pays a stipulated premium amount for the life cover provided to the insurer. On payment of premium, insurer issues a life insurance policy. The contract is legally binding though there are some clauses (suicide exclusion etc) which limit insurer’s liability.

In India, life insurance falls into many categories which are listed below:

Protection Plan: Better known as term plans, the objective of these life insurance policies is to provide life cover only. They are of two types- pure term plan and return of premium term plan. The difference being that the latter returns the base premium paid on maturity of the policy if life insured survives the policy term. These plans are cheapest among life insurance plans. Many insurers have launched online term plans which can be bought online directly by the customer and are very cheap because of fewer costs involved. The only limitation is that online term plans are available in few cities only.

Savings and Investment Plan: These life insurance policies include unit linked insurance plan and traditional endowment plan.

Both of these plans provide life cover and investment options.

Unit linked insurance plans (ULIP’s) invest the premium in equity, debt etc. ULIP are flexible, transparent and usually provide good returns over long term but are risky. The investment risk is borne by the policyholder.

Traditional endowment plans provide guaranteed returns on maturity. The downside is that returns are low. Traditional endowment plans come in following broad options:

- Pure endowment: These are traditional plans with limited policy term and provide guaranteed returns on maturity.

- Whole Life Insurance: These are traditional plans which continue for entire life. The individual gets life cover usually till the age of 100.

- Money Back Insurance: These are traditional plans which provide periodic payouts and also lump sum maturity amount.

Traditional endowment life insurance policies are usually “with profits” which implies that bonuses are declared which are added to the policy amount. However there are few “without profits” endowment policies as well.

Pension Plans: Also known as retirement plans, these life insurance policies help you build corpus amount over the years. After the policy term, the amount can be partially withdrawn for immediate needs and the rest is used to buy annuity. The annuity provides regular pension over the years. There are two types of pension plans- with life cover and without life cover. The current regulations dictate that insurer should specify the guaranteed maturity amount on inception of policy to the policyholder. Also, on maturity of pension plan, you can withdraw one-third in lump sum and rest of amount will be used to pay you periodic pension amount.

Health Plans: These life insurance policies provide with medical expenses incurred during hospitalization. Many health plans also pay lump sum amount regardless of actual hospitalization expenses. New health plans provide with a combination of health cover and investment options.

Which life insurance to choose?

The most essential life insurance policy is term plan. Term plans will make sure that your loved ones get a lump sum amount so that the amount covers your liabilities and they do not have to make financial compromises in the future. Term plan provides you peace of mind.

Term plan provides relatively large Sum Assured as compared to premium. A 30 year old person can get a cover of INR 50 lacs for merely 5k bucks through online term plan.

The other life insurance policies are more aligned towards investment and less towards life cover. If looking for high but risky returns, you can go for ULIP’s. Among ULIP’s, you can go for wealth plans, child plans, pension plans etc.

Traditional plans provide guaranteed returns but the growth on traditional plans is very low.

Riders: Additional financial security

Riders are add-ons that can be added to base life insurance policy to provide additional financial security for the insured and family members. Major riders are:

Accidental Death and Disability: This rider pays additional lump sum amount if the life insured suffers from death due to accident or sustains permanent and total disability like loss of limbs etc.

Critical Illness: If the life insured is diagnosed with critical illness, lump sum amount is provided to manage the financial difficulties. This amount is paid regardless of actual hospitalization expenses.

Waiver of Premium: In certain situations like disability, waiver of premium implies that there is no need to pay future premiums and the policy will still continue.

Family Income Benefit: This is usually an additional monthly benefit which will be paid to the family members on the death of life insured.

Tax Benefits in Life Insurance

Life insurance plans also provide tax benefits. The premium amount paid towards life insurance is deductible from taxable income subject to maximum of INR 100,000. This tax deduction is as per Section 80C of the Income Tax Act, 1961.

The maturity proceeds or death benefit amount is completely tax free under section 10 (10D) of the Income Tax Act, 1961.

Premium Payment

You can pay life insurance premiums through online by different payment modes like internet banking, credit or debit cards. You can also make the premium payment through cheque or cash. For premium amount above INR 50,000, PAN card is mandatory requirement.

The mode of premium payment in most life insurance policies is- annual, semi-annual, quarterly or monthly. Quarterly or monthly payments are usually done through ECS. Direct salary deduction option is also available with few insurers.

Many life insurance policies have single premium payment also where you pay lump sum amount once and there is no need for further payment.

LIC or Private Insurers

It is clearly the biggest concern among Indian customers. LIC is the oldest and well known established insurance company. LIC is also the market leader in life insurance. There is lack of trust among people for private insurers.

However all insurers are tightly regulated by Insurance Regulatory and Development Authority (IRDA) - the government body regulating insurance industry.

A genuine claim will never be rejected by the insurer.

Life Insurance Policy Comparison

Product innovation and strong competitive marketing has made choosing a life insurance policy very difficult. Instead of being carried away by products features, one should always do a “need analysis”. Choose a life insurance policy based on your requirements. There are many website portals (insurance aggregators) where you can make comparison of life insurance policy. Be sure to check comparison of products as you can end up saving quite a good amount of money.

Buying Life Insurance Online

Many life insurance policies are available online. There are very cheap term plans which can be bought online and less costly than regular term plans. Many insurers have also launched wealth plans online as well. By making life insurance policy online, it benefits both customer and insurer since distribution costs reduce by selling life insurance policy online. As such, insurer forwards the same benefit to the insured.

Life Insurance Terminology

Life Insured: The person whose life is covered by the insurance company

Insurer: Any one of the 24 insurance companies who provide life insurance

Fund Value: The accumulated amount in the life insurance policy

Sum Assured: The lump sum amount for which insured is covered for

Premium: The amount paid by the insured for the life insurance policy

Policy Term: The total number of years for which life insurance policy continues

Plan Name: Future Idols Gold

Insurer: DLF Pramerica Life Insurance

Category: Traditional Plan

Objective: Financially Securing Child’s Future

Comprehensive death benefits

Inbuilt Accidental total and permanent disability benefit

Riders

Loan

Minimum Entry Age: 18 Years

Maximum Entry Age: 60 Years

Maturity Age: 70 Years

Policy Term: 10-25 Years

Premium Paying Term: Regular

Premium Paying Mode: Annually, Semi-Annually, Quarterly, Monthly

Minimum Sum Assured: Rs 50,000

Minimum Sum Assured: Rs 20,000,000

Maturity Benefit:

At the end of policy term, Sum Assured along with guaranteed additions and regular additions will be paid.

Guaranteed Addition:

These are added every policy year and are equal to Rs 35 per 1000 of Sum Assured.

Regular Addition:

These are also added every policy year. When one buys policy, rate is declared between 1^st April- 31^st March and the rate then becomes guaranteed.

Death/Accidental Total and Permanent Disability Benefit:

On death or if life insured suffers from total and permanent disability, the following benefits are payable:

• 50% of Sum Assured along with accrued guaranteed additions and regular additions
• 1.5% of Sum Assured is paid monthly till the end of policy term
• 100% of Sum Assured is paid on maturity

Riders:

You can add Accidental death rider and Critical illness rider by paying additional premium to increase financial security.

Loan:

Loan facility is available after the 3 policy years. The maximum loan amount would be equivalent to 90% of the surrender value.

Under Section 80C you can avail tax benefit, yearly premium (not more than 1lac) will be deducted from taxable income.

Under Section 10(10D) death claim is completely tax free.

Paid up Sum Assured: After two policy years if you are unable to continue policy, you can convert to paid up. The policy will not participate in future performance. On maturity or death, reduced Sum Assured with guaranteed addition and regular additions will be paid.

Surrender Value: In case you want to cancel Future Idols Gold after 2 years, the minimum guaranteed surrender value is equivalent to 30% of all premiums paid barring the first year premium.

Free Look Period: Future Idols Gold plan can be cancelled within 15 days of receiving the policy contract. A written application can be submitted to any branch for the same. The premium will be paid back minus some charges like stamp duty, medical reports.

Policybazaar representatives will assist you in buying Future Idols Gold.

Future Idols Gold is a very comprehensive traditional life insurance plan designed to ensure child’s financial future.  The accidental total and permanent disability benefits are comprehensive as well. You can opt for riders and apply for loan against the policy too.

Insurer: Star Union Dai-ichi Life Insurance

Category: Unit Linked Insurance Plan

Objective: Financially Securing Child’s Future

• Monthly Payout in case of death
• Inbuilt Waiver of Premium
• Limited Premium payment term
• Riders and loan available

Maximum Entry Age: 13 Years (Child), 52 Years (Life Assured)

Maturity Age: 25 Years (Child), 52 Years (Life Assured)

Policy Term: 12-25 Years

Premium Payment Term: 5/7/10 Years, Policy Term

Minimum Premium: Rs 24,000 per annum

The fund value will be paid to the policyholder.

Death Benefit:

In case the life insured passes away, the Sum Assured will be paid to the nominee.

Monthly Income Benefit equal to 1% of Sum Assured will be payable every month.

The future premiums are waived off and will be added by the insurer to the fund value. The fund value will be paid at the end of policy term.

Riders:

By paying additional nominal premium, you can add the following riders with the plan to increase the financial security- Accidental Death and Total & Permanent Disability and Critical Illness.

Loan Facility:

You can apply for loans against the policy after completion of 3 policy years.  Depending on the fund allocation, the maximum loan amount that can be sanctioned is 40%-50% of the surrender value.

Settlement Option: Instead of lump sum amount on maturity, you can choose to receive the amount in installments over the next few years.

Returns in SUD Prabhat Tara 3

Any ULIP’s performance is directly dependent on the performance of the fund which in turn depends upon equity and debt market. If the market is rising, it will automatically reflect on your returns.

SUD has 4 funds available ranging from conservative to aggressive. If you have higher risk appetite and are for long term you can opt for aggressive fund. On the other hand, if you have limited investment period, you should go for conservative fund.

In a typical scenario, you will be able to get at least 10% return on investment. The investment risk is borne by the policyholder.

Are there any tax benefits?

Under Section 10(10D) death claim is completely tax free.

What are the charges in SUD Prabhat Tara 3?

Premium Allocation Charge:

The premium allocation charge for Prabhat Tara 3 is 6% of annual premium for the first 5 years and 5% from 6^th year onwards.

Fund Management Charge (FMC):

These are the charges levied as a percentage of fund value to manage the funds. The premium paid is allocated into different portfolio of funds. The annual FMC charge is 1% for all funds.

Policy Administration Charge:

These are monthly deductions which start from first month and are for maintaining the policy- paperwork, work force etc.  The annual policy administration charge is Rs 360 for the 1^st policy year increasing every policy year by 5% per annum.

Mortality Charge:

These are charges deducted as a part of life cover provided and are recovered through cancellation of units. Mortality charge is dependent on the risk cover taken along with age, gender and health condition.

Other Charges:

For benefits like premium waiver and monthly benefit, charges will be deducted through cancellation of units. The charge will depend on Sum Assured opted.

Switch: You can switch from one fund to another and only 1 switch is free of cost in a policy year. The minimum switch amount should be Rs 10,000.

Partial Withdrawal: If policyholder is above 18 years, you can withdraw some amount from the fund value. The minimum partial withdrawal amount is Rs 10,000. One partial withdrawals is free of cost.

Grace period: Prabhat Tara 3 Plan can be renewed within 30 days from the premium due date. For monthly mode, grace period is 15 days.

Insurer: IDBI Federal Life Insurance

Category: Unit Linked Insurance Plan

Objective: Financially Securing Child’s Future

Maximum Entry Age: 65 Years (Parent), 17 Years (Child)

Maximum Age at Maturity: 75 Years (Parent)

Policy Term: 10-25 Years

Premium Paying Term: 5 Years (Minimum), Policy term

Minimum Premium: Rs 25,000 Annual Mode

Returns in IDBI Federal Childsurance Dreambuilder

Any ULIP’s performance is directly dependent on the performance of the fund which in turn depends upon equity and debt market. If the market is rising, it will automatically reflect on your returns.

IDBI Federal has 6 funds available ranging from conservative to aggressive. If you have higher risk appetite and are for long term you can opt for aggressive fund. On the other hand, if you have limited investment period, you should go for conservative fund.

In a typical scenario, you will be able to get at least 10% return on investment. The investment risk is borne by the policyholder.

Premium Allocation Charges: There are equal to 3.15% of annual premium for first 5 years and there are no allocation charges thereafter.

Fund Management Charge: The annual charge range from 0.75% to 1.35% of fund value.

Policy Administration Charges: Policy administration annual charge is 6.30% of annual premium for the first 5 years and 3.15% thereafter.

Mortality Charge: These are charges deducted as a part of life cover provided and are recovered through cancellation of units.

Under Section 10(10D) death claim is completely tax free.

Switch: Switch is made to transfer the fund value from one fund to another. Switches are free of charge.

Partial Withdrawal: If policyholder is above 18 years, he can withdraw from fund value and minimum amount is Rs 10,000. You can make as many partial withdrawals as you want and are free of cost.

Grace period: Childsurance Dreambuilder can be renewed within 30 days from the premium due date. Additional 30 days are given after notice has been sent to revive or discontinue the policy.

What to do?

To Cancel Policy: Childsurance Dreambuilder plan can be cancelled within 15 days of receiving the policy contract. A written application can be submitted to any branch for the same. The premium will be paid back minus some charges like stamp duty, medical reports.

If you want to cancel policy after the initial period of 15 days, you can do it but the amount will be paid only after lock in period years. If you cancel policy within 5 years from inception, the amount will grow at interest rate of 3.5% compounded annually. After five years, if you cancel the policy, there will be no cancellation charges and amount will be paid immediately.

Insurer: Canara HSBC Life Insurance

Category: Unit Linked Insurance Plan

Objective: Financially Securing Child’s Future

Flexible Sum Assured

Waiver of Premium

Maximum Entry Age: 60 Years

Maturity Age: 70 Years

Policy Term: 10, 15, 20 or 25 years

Premium Payment Term: 10 Years (Minimum)

Minimum Premium: Rs 25,000 per annum

The fund value will be paid to the policyholder.

Death Benefit:

In case the life insured passes away, the Sum Assured will be paid to the nominee. The future premiums are waived off and will be added by the insurer to the fund value. The fund value will be paid at the end of policy term.

Milestone Withdrawal:

This is an optional feature provided by Canara HSBC. This feature ensures that you receive 15% of the fund value in each of the last 5 years of the policy term. The remaining amount is paid on maturity.

Flexible Sum Assured:

You can increase or decrease the life cover as per your requirement subject to the terms and conditions of the policy.

Discounts:

If you choose ECS or SI mode as payment options, premium allocation charges will be reduced.

Settlement Option: Instead of lump sum amount on maturity, you can choose to receive the amount in installments over the next few years.

Returns in Canara HSBC Future Smart

Any ULIP’s performance is directly dependent on the performance of the fund which in turn depends upon equity and debt market. If the market is rising, it will automatically reflect on your returns.

Canara HSBC has 5 funds available ranging from conservative to aggressive. If you have higher risk appetite and are for long term you can opt for aggressive fund. On the other hand, if you have limited investment period, you should go for conservative fund.

In a typical scenario, you will be able to get at least 10% return on investment. The investment risk is borne by the policyholder.

What are the riders available with Canara HSBC Future Smart?

Future Smart has waiver of premium on Accidental total and permanent disability available with it. If life insured suffers from total and permanent disability, future premiums will be paid by the insurer.

Under Section 10(10D) death claim is completely tax free.

What are the charges in Canara HSBC Future Smart?

Premium Allocation Charge:

The premium allocation charges for Future Smart range from 5.30% to 8.25 of annual premium for the first few years. After 10^th year there are no premium allocation charges.

Fund Management Charge (FMC):

These are the charges levied as a percentage of fund value to manage the funds. The premium paid is allocated into different portfolio of funds. The annual FMC charges are 1.35% for all funds except liquid fund which has 0.80%.

Policy Administration Charge: These are monthly deductions which start from first month and are for maintaining the policy- paperwork, work force etc.  The monthly charges are 0.05% of annual premium for the first 5 years. These charges will increase by 20% every 5 years.

Mortality Charge:

These are charges deducted as a part of life cover provided and are recovered through cancellation of units. Mortality charge is dependent on the risk cover taken along with age, gender and health condition.

Switch: You can switch from one fund to another and six switches are free of cost in a policy year. The minimum switch amount should be Rs 10,000.

Partial Withdrawal: If policyholder is above 18 years, you can withdraw some amount from the fund value. The minimum partial withdrawal amount is Rs 10,000. Four partial withdrawals are free of cost.

Grace period: Future Smart Plan can be renewed within 30 days from the premium due date. Additional 30 days are given after notice has been sent to revive or discontinue the policy.

Insurer: Kotak Life Insurance

Category: Traditional Plan

Objective: Financially Securing Child’s Future

Riders

Bonuses

Loan available

Maximum Entry Age: 10 Years (Child), 64 Years

Policy Term: 11-21 years

Premium Payment Term: 17 Years minus Age at entry of child

When the child turns 15, 17, 19 and 21; a specified % of Sum Assured is paid. The total amount is equal to 125% of Sum Assured plus bonuses.

Death Benefit

If the life insured passes away, 200% of Sum Assured is paid immediately. The future premiums are waived off and the maturity benefits will be paid as per the schedule. The bonuses are also paid on maturity.

Accidental Disability

If the life insured suffers disability due to accident, future premiums are waived off and the payouts will be paid as per the schedule. The bonuses will be paid on maturity.

Bonus

Child Edu plan is a participating plan and as such bonuses are provided depending upon the performance of the company.

Riders

There are a few riders available with the plan- Kotak term benefit, Kotak accidental death benefit and Kotak permanent disability benefit rider.

Discount

For Sum Assured equal and above Rs 5 lacs, discount on premium will be made.

Loan

You can apply for loan against the policy after the policy has acquired surrender value. The maximum loan amount would be limited to 80% of the surrender value.

Under Section 10(10D) death claim is completely tax free.

What else? 

Policybazaar representatives will assist you in buying Child Edu Plan.

Insurer: Bharti AXA Life Insurance

Category: Unit Linked Insurance Plan

Objective: Financially Securing Child’s Future

Education Allowance

Loyalty Bonus

Payouts in the last five years

Age eligibility of Bharti AXA Power Kid 

Maximum Entry Age: 50 years

Maturity Age: 70 Years (for 20 years term)

Policy Term: 15 and 20 years

Minimum Premium: Rs 26,000

Premium Paying Term: Regular

Premium Paying Frequency: Annual, Semi-Annual, Quarterly or Monthly

1.The remaining fund value after pay outs is paid to the policyholder

2. Career Development Allowance:15% of the residual fund value will be paid at the beginning of each of the last 5 years.

3.Loyalty Bonus:1% of the average fund value at the end of 15^th policy year and subsequently after every 5 policy years.

Death Benefits:

- In the event of death of life insured, fund value is paid to the beneficiary.

- Emergency Allowance: If two years premium have been paid, an emergency amount equal to Rs 100,000 is released to the nominee within 48 hours of submitting the claim documents. This amount is deducted from the Sum Assured when the final amount is paid.

- Education Allowance: This can be opted with the plan. If the life insured passes way, 10% of the Sum Assured will be paid on subsequent policy anniversary.

- Accidental Death Benefit :If the death is caused by the accident, addition lump sum amount equal to basic Sum Assured will be paid.

What are investment options with Bharti AXA Power Kid? 

The funds are mixture of equity and debt. You can chose among any of the six funds available which are listed below:

 -Safe Money Fund

 -Steady Money Fund

 -Save ‘n’ Grow Money Fund

 -Build India Fund

 -Grow Money Plus Fund

 -Growth Opportunities Plus Fund

Are there any tax benefits? 

Under Section 80C you can avail tax benefit, yearly premium (not more than 1lac) will be deducted from taxable income.

Under Section 10(10D) death claim is completely tax free.

What are the charges in Bharti AXA Power Kid? 

Premium Allocation Charge:

The premium allocation charges for Power Kid are:

Fund Management Charge (FMC):  The annual charges for growth opportunities plus fund, grow money plus fund, build India fund is 1.35%, save n grow money fund is 1.25% while the rest of fund have charges of 1.00%.

Policy Administration Charge: These are monthly deductions which start from first month and are for maintaining the policy- paperwork, work force etc.  The monthly charge is Rs 90 which begins from 6^th year escalating at 5% per annum.

Mortality Charge:These are charges deducted as a part of life cover provided and are recovered through cancellation of units. Mortality charge is dependent on the risk cover taken along with age, gender and health condition.

Switch: Switch is made to transfer the fund value from one fund to another. You can make 12 switches per year and additional switches can be made by paying Rs 100.

Partial Withdrawal: A minimum balance of 120% of Annual Premium should always be maintained after withdrawal. Two partial withdrawals are free per year.

Free Look Period: WealthOne plan can be cancelled within 15 days of receiving the policy contract. A written application can be submitted to any branch for the same. The premium will be paid back minus some charges like stamp duty, medical reports.

Policybazaar representatives will assist you in buying Power Kid.