SBI Life Smart Elite Review
Plan Name: Smart Elite
Insurer: SBI Life Insurance Company Limited
Category: Unit Linked Insurance Plan
Objective: Financial protection of family and good return on investment
SBI Life Smart Elite Plan has two variants:
Gold Option: It is Type I ULIP where under death clause, you will receive higher of Sum Assured or Fund Value
Platinum Option: It is Type II ULIP where under death clause, you will receive both Sum Assured and Fund Value.
There is inbuilt accidental death and accidental total and permanent disability which pays additional Sum Assured if the death occurs as a result of accident.
Benefits of SBI Life Smart Elite
Maturity: The fund value as on maturity date will be provided to you.
Flexible Sum Assured: You can increase or decrease the life cover as per your requirements.
Settlement Option: Instead of lump sum amount on maturity, you can choose to receive the amount in installments over the next few years.
Eligibility for SBI Life Smart Elite
Minimum Entry Age: 18 Years
Maximum Entry Age: 60 Years
Maximum Age at Maturity: 65 Years
Policy Term: 5 to 20 Years
Premium Paying Term: 5/8/10 Years, Single, Policy Term
Minimum Premium: Rs 150,000 Annual Mode
Returns in SBI Life Smart Elite
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.
SBI Life has six 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 charges does SBI Life Smart Elite deduct and how much?
The premium amount paid by you is not invested directly. Initially, some charges are deducted and then units of the fund are bought. The rest of charges are deducted by cancellation of the units.
Premium Allocation Charges: These charges are deducted as percentage of premium. Insurer deducts these charges on account of expenses incurred by the company – medical examination, policy issuance, underwriting bills. Premium allocation charges is 3% of annual premium and deducted till the end of 5th year.
Fund Management Charge: Charge ranging from 0.25% to 1.35% is deducted from the units for fund management.
Policy Administration Charge: These are monthly deductions which start from first month and are for maintaining the policy- paperwork, work force etc. The monthly policy administration charge is INR 60.
Mortality Charge: These are charges deducted as a part of life cover provided and are recovered through cancellation of units.
Other Charges: There is charge for switches, partial withdrawal after the limited free number have been utilized. Accidental benefit charges are deducted through cancellation of units.
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 else should I know about?
Top-Up premium: Not available
Switch: Switch is made to transfer the fund value from one fund to another. You can make two free switches per year.
Partial Withdrawal: If policyholder is above 18 years partial withdrawal can be made and the minimum amount is Rs 5,000.One free partial withdrawals can be made per year.
Grace period: Smart Elite 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: Smart Elite 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.
Compare Returns in Investment Plans!!
How much will you get?