• Kotak Premier Pension Plan

    Life Insurance
    • 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

    The Premier Pension Plan is traditional participating plan created to enable working individuals to invest in a corpus to assist them during their post-retirement life. The plan, through a number of assured benefits on vesting and death, will allow the policyholders to live a stress-free life.

    With plenty of interesting and handy features, this plan caters to the needs of a wide range of working professionals with different paychecks.

    Eligibility - Who the Kotak Premier Pension Plan for?

    For individuals to buy the Kotak Premier Pension Plan, they need to meet the basic eligibility criteria, which is as follows:

    Parameter Details
    Minimum Entry Age 30 years
    Maximum Entry Age Regular and Limited Payment model: 55 years Single Pay: 60 years
    Minimum Policy Term 10 years
    Maximum Policy Term 30 years

    Sum Assured and Premium Range - What you get and what it costs?

    Sum Assured:

    Sum Assured under the Kotak Premier Pension Plan is as follows:

    Minimum Sum Assured: Rs.2 lakhs

    Maximum Sum Assured: No limit as it depends on underwriting

    Premium Range:

    Premium Range for Kotak Premier Pension Plan depends on the type of payment frequency chosen, i.e., monthly, quarterly, half-yearly, and yearly, and the term chosen.

    Plan Coverage - What the Kotak Premier Pension Plan covers?

    The Kotak Premier Pension Plan comes with a number of interesting features. Here’s all of them listed below in the tabular column.

    Feature Details
    Guaranteed Additions A Premier Pension policy is eligible for Guaranteed Additions, wherein a small percentage of the sum assured will be added to the sum assured. These additions vest when a financial year comes to an end and is made available upon vesting and death, whichever event occurs earlier, provided that all the due premiums are paid. Here’s the additions that will be added for different payment frequencies:
    • Regular and limited premium option: 5% per annum of the basic sum assured.
    • Single payment option: 2% per annum of the basic sum assured.
    Assured Benefit Assured benefit is the benefit a policyholder will get at the time of vesting and when he/she meets their demise. This benefit will be at least 105% of the total premiums paid, excluding any taxes and rider premiums paid at the time of death or vesting.
    Death Benefit If the person insured meets their demise, the nominees will receive the Assured Benefit along with Guaranteed Additions, and any accrued Reversionary and Terminal Bonuses. Also, the nominees have two options to choose from as far as death benefit is concerned.
    • They can either use the total payable amount (full or partial) to opt for a new annuity policy from Kotak Life Insurance.
    • Withdraw the entire amount and terminate the policy.
    Vesting Benefit Once the policy reaches its vesting and maturity period, benefits payable will be: The basic sum assured along with the accrued guaranteed additions, and accrued terminal bonus and reversionary bonus, if applicable. The bonus you receive will be any one of the following:
    • Receive 1/3rd of the vesting benefit tax free and use the rest to buy another Kotak Insurance policy.
    • Purchase a single premium policy from Kotak.
    • Increase the accumulation period, as long as the person insured is below 55 years of age.
    An aspect worth noting here is that the vesting benefit will be subject to a minimum of the sum assured.

    Riders - Additional coverage for Kotak Premier Pension Plan:

    A rider is basically a policy which can be availed on top of the original policy to enhance the coverage options available. There are two riders available under the Kotak Premier Pension Plan. These are as follows:

    Exclusions - What the Kotak Premier Pension Plan doesn’t cover?

    The policy has just one exclusion, which is regarding the issue of suicide. Under this policy, if the person insured commits suicide within a year, the nominees will be paid at least 80% of the sum assured.

    • If a policyholder commits suicide within a year of reviving the policy, and the revival is done before six months of the last unpaid premium, no suicide exclusion will hold true and the total death benefit mentioned in the policy, based on the premiums, will be paid.
    • If a policyholder commits suicide within a year of reviving the policy, and the revival is done before six months of the last unpaid premium, higher of the surrender value or 80% of the total premiums paid, will be provided as final settlement, after which the policy will be closed.

    Other Key Features of Kotal Premier Pension Plan:

    Some of the key features of the plan are as follows:

    Bonuses The plan offers three different types of bonuses to the policyholder. They are:
    • Simple Reversionary Bonus: This is a bonus that the insurance company may and may not declare at the end of a financial year. The amount paid will usually be a small percentage of the sum assured. The bonus will start accumulating only at the beginning of the 6th year and will be paid out at the time of the person insured’s death or if the policy completes its vesting period.
    • Terminal Bonus: This is another bonus the company may choose to pay if the person insured dies after 10-full policy years. The amount paid here again will be a percentage of the sum assured. However, these bonuses are not available for paid-up and surrendered policies.
    • Interim Bonus: In case a claim is made mid-year before the company provides its reversionary bonus. The company may choose to offer an interim bonus as a sign of goodwill for the policyholder.
    Grace Period A policyholder will be given a grace period of 30 days from the last date for premium payment, in the case of yearly, half-yearly, and quarterly plans. On the other hand, monthly payment plan holders will only receive a grace period of 15 days, within which period the policy needs to be revived/
    Annuity If the policyholder decides to reinvest the vesting and surrender benefits, they can choose to buy a Kotak Annuity Plan. However, if the annuity amount is less than Rs.1,000 per month, the policyholder can receive the amount on a lump sum basis.
    Reduced Paid-up Policy This is applicable to regular and limited premium paying policies, wherein if the plan reaches surrender value and subsequent premiums are not paid within the grace period, the policy will be turned into a reduced paid-up policy by default.
    Nomination As per Section 39 of the Insurance Act, nomination facility will be available under this plan.
    Assignment Assignment facility is not available under this policy.
    Free Look Period If the policy is bought through conventional means, a free look period of 15 days in provided, wherein a policyholder can choose to withdraw his/her investment and get a refund of all the payments they have made. On the other hand, if the policy is bought by Distance Marketing means, a free look period of 30 days is offered to individuals.
    Policy Revival A lapsed policy can be revived if the outstanding premiums are paid within 2 years of the last unpaid premium. However, to complete the revival the policyholder will need to pay a penalty which, at the moment, stands at 9% of the outstanding premium.
    Surrender Depending on the payment term and the number of premiums paid, a policy acquires a Guaranteed Surrender Value (GSV).
    • In the case of regular and limited premium policies, the policy will attains a GSV only after premiums have been paid for the first three years.
    • On the other hand, for single premium policies, the policy attains a GSV once the single premium has been paid.

    Tax Benefits - How you can save with Kotak Premier Pension Plan?

    People who own the Kotak Premier Pension Plan can save a lot of money on taxes. According to the Income Tax Act, insurance premiums are eligible for deduction under Section 80C and Section 10 (10D) of the country’s tax framework.

    Why you should buy the Kotak Premier Pension Plan?

    The Kotak Premier Pension Plan is ideal for you if you are looking to save a sizeable amount of money to secure your post-retirement. This plan comes with several rarely seen benefits such as guaranteed additions, assured benefit, and the like and also offers bonuses depending on the number of years you have owned the policy for. Another important aspect of this policy is that it comes with multiple payment options, which can be made use of by you depending on your income.

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