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Reliance Nippon Life Child Plan

Having a child is a big decision. One should be mentally and financially prepared to have a child as it is a huge responsibility. Parents always want the best for their children. Be it education or career, they always dream big for their precious little ones. In this competitive world, financially planning for your kid’s future is very important to help them achieve their dreams. With the help of Reliance Nippon Life Child Plan, you can make your child’s dream come true. Reliance Nippon Life Child Plan is designed for millions of parents out there who wish to see their children succeed, despite of what life throws at them. Life is very uncertain but your finances doesn’t have to be. Reliance Nippon Life Child Plan offers guaranteed benefits at key milestones of your child’s life, even if you are not around, without burdening them with the future premiums. Reliance Nippon Life Child Plan will keep your children well-funded, giving them the confidence to go achieve their dreams.

Reliance Nippon Life Child Plan is a non-linked, participating, non-variable child insurance plan under which policyholders will be required to pay premiums regularly throughout the policy term. If the policyholder has made all premium payments promptly, guaranteed periodic benefits which is 25% of the base sum assured plus high sum assured addition benefit, if any will be paid on every third year policy anniversary, irrespective of the maturity date or the survival of the life. This plan also offers death benefit, guaranteed sum assured, and other such benefits.

Eligibility – Who is the Reliance Nippon Life Child Plan for?

To be eligible to purchase the Reliance Nippon Life Child Plan, individuals will have to meet the below mentioned eligibility criteria:

Parameter Details
Plan Type Non-linked, participating, non-variable child insurance plan
Minimum Entry Age   20 years
Maximum Entry Age 60 years
Minimum Age at Maturity   30 years
Maximum Age at Maturity   70 years
Policy Term 10 to 20 years

Sum Assured and Premium Range – What You Get and What It Costs

While purchasing the Reliance Nippon Life Child Plan, the policyholder will be given an option to select the sum assured amount. For more information on the sum assured and the premium range under the Reliance Nippon Life Child Plan, read on.

Parameter Details
Sum Assured The policyholder should choose the sum assured at the inception of the policy.
Premium Payment Term 10 to 20 years
Premium Payment Modes Yearly, Half-yearly, Quarterly and Monthly

Plan Coverage – What the Reliance Nippon Life Child Plan Covers

Following are the benefits offered by the Reliance Nippon Life Child Plan:

Guaranteed Periodic Benefits Under the Reliance Nippon Life Child Plan, the insured will receive guaranteed periodic benefits on each of the three policy anniversaries before maturity, irrespective of the survival of the life assured. The guaranteed periodic benefit is 25% of the base sum assured plus high sum assured addition benefit, if any.
High Sum Assured Additions  
Base sum assured High sum assured addition (as a percentage of base sum assured)
Less than Rs.2.5 lakhs Nil
Rs.2.5 lakhs and above but less than Rs.5 lakhs 0.2%
Rs.5 lakhs and above 0.3%
Maturity Benefit The Reliance Nippon Life Child Plan also offers maturity benefit. The guaranteed sum assured on maturity is 25% of the base sum assured plus high sum assured addition benefit, vested bonuses, non-negative capital guarantee addition, if any.
Bonuses The policy attracts simple reversionary bonuses which is usually declared the by company at the end of every financial year. The reversionary bonus for a year, once declared and credited to your policy, becomes guaranteed.
Non-negative Capital Guarantee Under this plan, if the sum of all the benefits (guaranteed periodic benefits, guaranteed sum assured at maturity, vested bonuses and death claim, if any) is lesser than 100.1% of the total premiums paid, the deficit amount will be paid.
Guaranteed Death Benefit In the event of death of the policyholder, guaranteed death benefit is given. This benefit is payable only when the insured person dies during the policy term and provided the policy is in active status. The nominee will receive the minimum sum assured amount on death plus vested bonuses and 105% of all the premiums paid, excluding the underwriting extra premiums, as on the date of the death. Please note that the death benefit will be chosen by the insured person while purchasing the policy and it cannot be changed during the policy term.
Waiver of Premium benefit In the event of death of the life assured, the insurer will waive all future premiums .
Surrender Benefit Under the Reliance Nippon Life Child Plan, policyholders will have an option to surrender their policy. The surrender value depends on teh year of the surrender and the policy term. Please note that the surrender value payable will be higher than the guaranteed surrender value and special surrender value. In case the life assured dies before completing three policy years, the accumulated surrender value becomes payable.
Guaranteed Surrender Value Policyholders will be eligible for guaranteed surrender value only if they have paid first three annualized premiums. The guaranteed surrender value is a percentage of the total premiums paid, excluding rider premiums and extra premiums paid minus any survival benefits already paid.
Special Surrender Value If the policyholder has paid all premiums for at least first three consecutive years, surrender value becomes payable. The special surrender value factor is an actuarial present value of the future benefits. The company reserves the right to change the method of calculating the special surrender value.
Paid-up Benefit If the policyholder discontinues paying the premiums after paying for at least the first three full policy years, such policy will be termed as “Paid-up Policy”. The benefits of paid-up policy is as follows:
Event Payout
Death Minimum sum assured on death multiplied by the total number of premiums paid divided by the number of premiums payable plus vested bonuses.
Period Guaranteed Benefit Periodic guaranteed benefit is payable on each of the last three policy anniversaries before maturity. 25% of the base sum assured plus high sum assured addition benefit, if any multiplied by the number of premiums paid divided by the total number of premiums payable.
Maturity Benefit Guaranteed sum assured at maturity multiplied with number of premiums paid divided by the total number of premiums payable plus vested bonuses.

Riders/Add-On Plans – Additional Coverage Under the Reliance Nippon Life Child Plan

Policyholders can attach a add-on to their base policy if they are looking for extra protection. Please note that when issuing the Reliance Nippon Life Child Plan, riders will not be available. However, the insurance company may allow riders under this plan in the future, subject to approval by regulator.

Other Key Features

Following are some of the other key features of the Reliance Nippon Life Child Plan:

Grace Period The Reliance Nippon Life Child Plan has a grace period of 30 days from the due date for payment of premiums if the payment is made in yearly, half-yearly, or quarterly modes. In case the premiums is paid in monthly mode, the grace period is 15 days.
Lapse If the policyholder does not pay three annualised premiums in full, the policy will lapse at the end of the grace period. If a policy is in lapsed status, no benefits will be payable.
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. The insured has to pay the total outstanding premiums with interest to reinstate the policy.
Free Look Period The Reliance Nippon Life Child Plan has a free look period of 15 days within which the policyholder can cancel the policy and and get the premiums paid refunded. For policies purchased through distance marketing, the free look period is 30 days from the receipt of the policy document.
Policy Loan Facility After the first three years, policyholders are eligible for loans up to 80% of the surrender value. Currently, the interest rate on loans is 10.50% p.a.
Assignment Assignments are allowed under the Reliance Nippon Life Child Plan. It should comply with provisions of Section 38 of the Insurance Act, 1938.
Nomination Nominations are allowed under the Reliance Nippon Life Child Plan. It should comply with the provisions of Section 39 of the Insurance Act, 1938.

Exclusions – What is Excluded from the Reliance Nippon Life Child Plan

There is one exclusion under the Reliance Nippon Life Child 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, the nominee will be eligible to receive 80% of the premiums paid excluding service tax, provided the policy is active. If the insured commits suicide within one year from the date of revival of the policy, higher of 80% of premium paid, excluding service tax till the date of death or the surrender value as available on the date of death will be payable.

Tax Benefits – How You Can Save with the Reliance Nippon Life Child Plan

Policyholders who have purchased the Reliance Nippon Life Child Plan will enjoy tax benefits under Section 10(10D) and Section 80C of the Income Tax Act, 1961.

Why You Should Choose the Reliance Nippon Life Child Plan?

It is very important that we buy insurance plan from a reputable insurance provider. Reliance Nippon Life Insurance Company is one of the leading private sector insurance companies in India. According to the Brand Equity‘s Most Trusted Brands Survey 2015, Reliance Nippon Life Insurance Company is one among the top 3 most trusted life insurance service brands in the country. The company has set its feet in five distinct sectors, namely protection, insurance for children, retirement plans, saving and investment, and Health. Most of their plans are offered to both individuals as well as groups. If you are looking to set a strong financial portfolio, Reliance Nippon Life Child Plan will be the perfect fit.

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