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Kotak Term Plan

The 21st century world we live in is full of uncertainties, so much that there’s no predicting what might occur the next moment or the one after that. This is one of the reasons why owning a term life insurance - like the one offered by Kotak - is absolutely essential. The Kotak Term Plan is a complete risk-cover plan, which offers a relatively secure financial future to a policyholder’s family, albeit at a low cost. It comes with plenty of benefits for the end user and offers a sum assured if the life insured meets an untimely death.

Eligibility - Who is the Kotak Term Plan for?

The Kotak Term Plan is beneficial for individuals who don’t have too much capital to spend on paying premiums, but are still looking to secure their family’s security in case they come to pass.

Parameter Details
Age of entry Minimum - 18 years Maximum - 65 years
Maximum age at the time of maturity 70 years

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

Below are the particulars about sum assured and the premium range available under the Kotak Term Plan.

Sum Assured:

Sum assured under the Kotak Term policy has both a minimum and a maximum. While the minimum sum assured is Rs.3,00,000, the maximum limit stands at Rs.24,99,999.

Plan Coverage - What the Kotak Term Plan offers?

The Kotak Term Plan comes with a number of benefits. Here are a few of them listed for you:

Death Benefit In case the person insured meets with an untimely death, the death benefit payable will be the sum assured mentioned under the policy. However, before making the payment, any premium that need to be paid for that particular year will be deducted before making the settlement.
Maturity Benefit There are no maturity benefit available under this policy.

Riders/Add-On Plans - Additional Coverage under the Kotak Term Plan:

The Kotak Term Plan also offers policyholder with option to extend their coverage limits. This can be done through several riders, which are exclusively available under the policy. To avail a rider the policyholder needs to pay a nominal fee, after which the insurer sells the policy. Here are the riders available for Kotak Term Plan.

Kotak Accidental Death Benefit Rider Among the handful of riders available the Accidental Death Benefit Rider is one of them. Based on this rider, if a policyholder succumbs due to unforeseen circumstance, a lump sum amount will be paid as death benefit to the nominees listed under the policy. A point worth noting here is that the insurer defines accidental death as a death occurring due to a sudden and an unexpected situation, caused by an external stimulus.
Kotak Permanent Disability Benefit Rider The benefits payable for a permanent disability case would be the installments paid at the time of at the time of admitting to a disability after an accident.
Kotak Critical Illness Benefit Rider The payout for a critical illness would be a portion of the sum assured, which will be paid once the person insured is diagnosed with an illness covered in the terms and conditions.

Exclusions - What the Kotak Term Plan doesn’t cover?

There is an exclusion in the Kotak Term Plan which relates to the policyholder dying due to suicide, wherein,

  • If a policyholder commits suicide within the first year of buying the policy, the nominees will be paid up to 80% of the total premiums 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, 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 – Freelook Period, Surrender Values, Grace Period etc.

Apart from the ones mentioned above, there are several other key features that form a part of Kotak Term Plan. All of them are listed in the tabular column below:

Particulars Explanation
Grace Period If a policyholder decides to return the policy after purchasing it, he/she will have a grace period of 30 days (for quarterly, half-yearly, and yearly modes), wherein they have to return the policy within this period. On the other hand, grace period for monthly payment frequency stands at 15 days. Also, if the person insured dies within the grace period, the sum assured will be paid after deducting the premiums for that particular year.
Lapse If a policyholder fails to renew the policy within the grace period, the policy along with the riders will lapse, meaning all the coverage will cease to exist.
Policy Revival A lapsed policy can be revived only after meeting the following criteria:
  1. If the revival request comes within two years of the first unpaid premium. Note that, to revive the policy a customer must pay the handling charges. If the policy premiums are paid along with the handling charges within a period of six months, the policy can be revived without having to provide a proof of good health.
  2. If the revival happen after six months, health proof needs to be submitted.
Surrender Policyholders can choose to surrender their policy anytime during the term. However, only single-pay customers will receive the benefit while regular payers won’t. Under such a situation, the amount payable would be calculated based on this formula: 75% of premiums paid * (1-1/policy term) * (Outstanding policy term/policy term)
Free Look Period Free look period is like a trial run offered by insurers to prospective policy buyers. For policies sold through traditional channels, a free look period of 15 days will be available. On the other hand, if the policy is sold through some distance marketing avenues, a free look period of 30 days is available.

Tax Benefits - How you can save with the Kotak Term Plan?

Policyholders can avail tax benefits if they buy the Kotak Term Plan. The deductions available will be based on Section 80C and Section 10(10D) of the Income Tax Act. The extent of tax break available will be based on the specific product mentioned in the act.

Why you should buy the Kotak Term Plan?

The Term Plan offered by Kotak Life Insurance is one of the fastest growing and most affordable insurance products in the country. This plan is specifically designed keeping in mind the various needs and requirements of the middle-class population in India, who are constantly working towards achieving financial autonomy for themselves and their family.

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