Kotak Leave Encashment Group Plan
- Reduce taxable income by up to Rs. 1,50,000 deduction under section 80C**
- Convenient payment options - annual, half-yearly, quarterly or monthly premium payments
- Do more with plans that offer pure protection, retirement planning and investment options
Kotak Leave Encashment Group Plan offered by Kotak Life Insurance is a unit linked group leave encashment plan. When the salary and number of service years increase for an employee, the liabilities associated with leave encashment also goes up. The leave encashment can prove to be a major liability to the organisation. Kotak Leave Encashment Group Plan helps in reducing the financial pressure on the employer and helps them to fund the liabilities associated with leave encashment payable to the employees.
Eligibility – Who is the Kotak Leave Encashment Group Plan for?
In order to buy the Kotak Leave Encashment Group Plan, a customer has to fulfil certain eligibility criteria with respect to his/her age and the amount of insurance he/she seeks. These conditions are as shown below:
| Parameters | Criteria for Eligibility |
| Minimum age at entry | 18 years. |
| Maximum age at entry | As per the rules mentioned in the scheme, subject to a maximum age of 74 years. |
| Minimum size of the group | 10 employees. |
| Minimum Contribution for Leave Encashment | Rs.2,00,000 at inception. |
| Maximum Contribution for Leave Encashment | No limit. |
Sum Assured and Premium Range – What you get and what it costs?
Sum Assured - The amount that is be offered to the family of the member, in case of an event where the member encounters permanent disability, critical illness or death is known as sum assured.
Premiums – The amount that the insured pays at once or at regular intervals for keeping the policy active is known as premium. The premium allocation charge for a premium of up to rs.2 crores is 0.5%. For any potion above Rs.2 crores, no allocation charge is applicable.
Plan Coverage – What the Kotak Leave Encashment Group Plan covers?
| Parameters | Criteria for Eligibility |
| Death Benefit | In case the assured individual encounters death, then Rs.1,000 is paid out to the nominee. The settlement of leave encashment is done according to the rules of the scheme. |
| Survival Benefit | In case the assured survives till the end date of the Kotak Leave Encashment Group Plan, then at the time of retirement, termination or resignation the benefit is paid out according to the rules of the scheme. |
| Employer Benefit | The amount equal to the leave encashment benefit as and when given by the employer is deducted from his/her income. This is done as per the regulations under Section 43B of the IT Act, 1961. |
| Employee Benefit | In case the insured is a government employee, leave encashment benefits are received when the employee retires. The leave encashment benefits are tax free.
In case the insured is a non-government employee, leave encashment benefits are exempted from the taxes subject to the following amounts:
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Exclusions – What the Kotak Leave Encashment Group Plan does not cover?
There is no suicide exclusion applicable under the Kotak Leave Encashment Group Plan.
Other Key Features of Kotak Leave Encashment Group Plan:
| Premium Allocation Charges | This amount is charged as a contribution percentage. For all premiums up to an amount of Rs.2 crores, the allocation charge is 0.5%. For a portion of the premium that is above Rs.2 crores, no allocation charge is applicable. |
| Administration Charges | No policy administration charge is applicable. |
| FMC or Fund Management Charges | This particular charged is applicable an asset value percentage and it is appropriated by adjusting NAV. Mentioned below are the Fund Management Charges that are applicable on a yearly basis for available funds:
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| Mortality charges | The mortality charge is Rs.1 to Rs.1,000 sum assured. |
| Switching charges | No switching charges are applicable. |
| Surrender charges | This particular charge is applicable on unit fund when the contract is surrendered. For surrender between 1 year and 3 years of the policy, the surrender charge is 0.05% subject to a maximum amount of Rs.5 lakh. No surrender charge is applicable from the 4th year. |
| Redirection charge | No redirection charge is applicable. |
| Free look period | If the policyholder does not like the terms and conditions of the plan, he/she will get a period of 15 days to return the policy. The reasons for returning the policy must be given in writing. The policy cancellation request must go to one of branches of Kotak Life Insurance or to the Head Office. |
| Renewal | The Kotak Leave Encashment Group plan is renewed automatically |
Tax Benefits – How you can save with the Kotak Leave Encashment Group Plan?
Cess and Service Tax will be deducted from the premiums as per prevailing tax laws.
Why choose the Kotak Leave Encashment Group Plan from Kotak Life Insurance?
Kotak Mahindra is one of the leading financial institutions in India that offers great products and services. All of their products including insurance, investment banking, stock broking, mutual funds, commercial banking, etc. are tailored as per the changing need and requirements of the customers. Kotak Leave Encashment Group Plan helps in reducing the financial pressure on the employer and helps them to fund the liabilities associated with leave encashment payable to the employees.
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