Kotak Mahindra Old Mutual Life Insurance Ltd. is one of the pioneers in the insurance industry in India. From time to time, they have offered excellent insurance products for their customer’s well-being. From mutual funds and life insurance to stock broking and investment banking, Kotak Mahindra offers it all. Their insurance products are designed to offer protection for individuals and families. While there are many insurance plans that offer protection to the insured person, there are few innovative plans that offer an opportunity for savings and wealth accumulation. Kotak Classic Endowment Plan is one such product.
Kotak Classic Endowment Plan is a long-term protection cum savings insurance scheme by Kotak in which policyholders get protection benefit and can earn bonuses during the term of the policy. Under this plan, the policyholders will be allowed to select the sum assured they receive when the policy matures. At maturity, the policyholders will get the sum assured plus accrued bonus, if any. Also, under this plan, the policyholders will have 2 premium payment options, namely regular pay and limited pay.
To be eligible to purchase the Kotak Classic Endowment Plan, individuals will have to meet the below mentioned eligibility criteria:
|Plan Type||Protection cum savings plan|
|Minimum Entry Age||0 years|
|Maximum Entry Age||If you choose the regular premium payment plan, the maximum entry age is 55 years. For limited premium payment plan, the maximum entry age is 60 years. Whereas for the premium payment plan for 15 or 7 years policy term, the maximum entry age is 58 years.|
|Minimum Age at Maturity||18 years|
|Maximum Age at Maturity||75 years|
|Policy Term||15 years to 30 years|
When purchasing the Kotak Classic Endowment Plan, individuals can choose from 2 sub-options, namely regular pay and limited pay. The premium payments towards a Kotak Classic Endowment Plan can be made on a monthly/quarterly/semi-annual/annual basis. Following are the sum assured and premium details of the Kotak Classic Endowment Plan:
|Sum Assured||There is no fixed minimum and maximum sum assured under the Kotak Classic Endowment Plan. Please note that the sum assured will be determined based on the minimum premium amount paid by the policyholder, entry age of the insured, policy term, premium payment plan, and other such factors.|
|Premium Payment Option||Regular and limited pay|
|Premium Payment Term||In case of regular pay policies, the premium payment term will be equal to the policy term. In case of limited pay policies, the premium payment term will be 7 pay for policy of 15 years.|
|Premium Range||Minimum premium for regular pay is Rs.7,000. Minimum premium for limited pay is Rs.7,000 (except for PT/PPT combination of 15/7 years). Minimum premium for policy term and premium payment plan combination of 15/7 years is Rs.12,000. There is no maximum limit on premiums paid. It is subject to the underwriting rules.|
|Premium Payment Mode||Monthly/Quarterly/Semi-Annual/Annual|
Please note that premiums vary based on age, location, plan term and other factors
Following are the benefits offered by the Kotak Classic Endowment Plan:
|Death Benefit||In case of unfortunate death of the insured person during the policy term, the nominee will receive the sum assured plus accrued bonuses, if any. The death benefit provided will be subject to a minimum of 105% of total premiums which are paid till the date of death of the insured. Also, the sum assured on death is 11 times the annual premium.|
|Maturity Benefit||The Kotak Classic Endowment Plan also offers maturity benefit. If the policyholder survives till the end of the policy term, maturity benefit will be paid. The maturity benefit paid under the Kotak Classic Endowment Plan is the sum assured amount, accrued reversionary bonus, if any, and terminal bonus, if any.|
The Kotak Classic Endowment Plan offers six additional riders that can increase the value of the policy, namely Kotak Term Benefit Rider, Kotak Accidental Death Benefit Rider, Kotak Permanent Disability Benefit Rider, Kotak Critical Illness Benefit Rider, Kotak Life Guardian Benefit Rider, and Kotak Accidental Disability Guardian Benefit Rider. If the policyholder feels that the base plan is not adequate, they can choose one of the additional coverage options available. For more details on the add-on plans under this policy, read on.
Following are some of the other key features of the Kotak Classic Endowment Plan:
|Surrender Value||Under the Kotak Classic Endowment Plan, a guaranteed surrender value will be given to policyholders. The guaranteed surrender value depends on the premium payment term chosen by the policyholder at the times of purchasing the plan and the number of premiums paid. The guaranteed surrender value is a percentage of the total premiums paid by the policyholder d (excluding Service Tax & Cess, as applicable, Rider premium and Extra Premium, if any) plus the value of subsisting bonuses, if any. Policies with premium payment term of less than 10 years attract a guaranteed surrender value after payment of full premiums for two consecutive years. Policies with premium payment term of 10 years or more attract a guaranteed surrender value after payment of full premiums for three consecutive years.|
|Grace Period||The Kotak Classic Endowment Plan has a grace period of 30 days from the due date for premium payment in case of quarterly, semi-annual and annual modes. In case of the monthly mode, the grace period will be 15 days.|
|Lapse||In case of Limited Premium paying policies, if the premium payment term is less than 10 years, and the premiums for the first two policy years remain unpaid within the grace period and for premium payment terms of 10 years or more, if the premiums for the first three policy years remain unpaid within the grace period, the policy will lapse from the due date of the first unpaid premiums and the customer will not be eligible for any benefits.|
|Revival / Renewal||A lapsed policy can be reinstated for full benefits by reviving it within two years from the date of the first unpaid premium. Please note that the policy can be revived without providing the evidence of good health on payment of the outstanding balance by paying revival charges, if the payment is made within 6 months from the date of first unpaid premium. Currently, the revival charges are 9%p.a of the outstanding premiums. If a lapsed policy is not revived during the revival period, the policy will be terminated and no benefits will be payable.|
|Free Look Period||Customers who purchase this policy have the option to return it within 15 days if they are not satisfied with the terms and conditions of the same. If the policy is purchased through distance marketing channels, the free look period will be 30 days.|
|Policy Loan Facility||Under the Kotak Classic Endowment Plan, policyholders can avail loans up to 80% of the surrender value subject to a minimum loan amount of Rs.10,000.|
|Assignment||Assignments are allowed under the Kotak Classic Endowment Plan. It should comply with provisions of Section 38 of the Insurance Act, 1938.|
|Nomination||Nominations are allowed under the Kotak Classic Endowment Plan. It should comply with the provisions of Section 39 of the Insurance Act, 1938.|
|Reduced Paid-up Benefit||If premiums are not paid within the grace period right after the policy acquired surrender value, the policy will be converted into a reduced paid-up policy automatically. In this case, along with the reduced paid-up benefit sum assured, all subsisting reversionary bonuses that are already attached to the policy will be payable at maturity.|
|Discount for High Sum Assured on Maturity||Policyholders will get a premium discount for sum assured on maturity of Rs.5 lakhs and above. The discount will be Rs.2 per Rs.1,000 sum assured on maturity.|
|Modal Factor (% of annual premium)||The following modal loadings will be used to calculate the instalment Premium. Yearly - 100% Half yearly- 51% Quarterly - 26% Monthly - 8.8%|
|Simple Reversionary Bonus||Under the Kotak Classic Endowment Plan, policyholders will benefit from three types of bonuses. One of it is the simple reversionary bonus. At the end of every financial year, the insurer may offer a bonus expressed as a percentage of the sum assured on maturity. These bonuses will be accrued from the first policy year onwards and till the end of the policy term. It will be payable either on maturity or death of the insured.|
|Interim Bonus||In the event of a claim, before completing a financial year or before declaration of the simple reversionary bonus for the financial year in which such a claim is intimated, an interim bonus may be payable at such rate as may be decided by the Company, only if it is applicable.|
|Terminal Bonus||In case of death of an insured after 10 full policy years, the insurance company may decide to give terminal bonus. This bonus will be payable on maturity and will be a percentage of the sum assured on maturity. Please note that this bonus will not be applicable on policies which are converted to reduce paid-up policies or surrendered policies.|
There is one exclusion under the Kotak Classic Endowment Plan which is the suicide exclusion.
Suicide exclusion: If the life insured commits suicide within one year from the date of issue of the insurance policy, 80% of the premiums paid will be payable. If the insured commits suicide within one year from the date of revival of the policy and if the policy is revived within 6 months from the first missed payment, suicide exclusion will not be applicable and death benefit will not be paid. However, if the insured commits suicide within one year from the date of revival of the policy and if the policy is revived after 6 months from the first missed payment, the benefit payable will be 80% of premiums paid or equal to the surrender value at the date of claim event.
Policyholders who have purchased the Kotak Classic Endowment Plan will enjoy tax benefits under Section 10(10D) and Section 80C of the Income Tax Act, 1961.
Kotak Mahindra Old Mutual Life Insurance Ltd. is one of the leading insurance providers in India. It is a joint venture between Kotak Mahindra Bank Ltd. and Old Mutual Plc. The company offers a wide range of insurance products which are specially designed to meet individual requirements from various sectors. The company caters to more than 15 million people across the country. They have over 232 branches in around 167 cities and towns in India. Currently, the company has more than 32 listed products which include 9 group products, 10 ULIPs, and 18 rider options.
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