Shriram Life New Group Gratuity Plan is a unit linked non-participating group insurance plan offered by Shriram Life Insurance. Employers can get the following benefits under this plan:
- Choose between 3 unit linked plans
- Switch funds unlimited times a year without any charge
- Premium redirection
- Optional life insurance cover
- Tax benefits for both the employer and the employees
- Help with annual actuarial valuation of gratuity liabilities
Eligibility - Who is the Shriram Life New Group Gratuity Plan for?
Listed below are the eligibility factors you must meet to purchase Shriram Life New Group Gratuity Plan:
||Minimum 20 employees
||14 to 74 years old
||Maximum 75 years old
Sum Assured and Premium Range - What you get and what it costs?
The contribution amount, Policy Term and Sum Assured for Shriram Life New Group Gratuity Plan are as follows:
|Premium Payment Mode
||Yearly, half-yearly, quarterly or monthly
||Minimum Rs.1,000 per member to maximum no limit
||As per the Actuary's certificate submitted by the policyholder in accordance with AS-15
Plan Coverage - What the Shriram Life New Group Gratuity Plan covers?
This how Shriram Life New Group Gratuity Plan works:
Who can buy this plan?
- Employers who want to set up a new gratuity fund for the first time.
- Employers who have existing self-managed gratuity fund.
- Employers who have gratuity fund managed by another life insurance company.
Life Cover: Policyholder can choose the insurance cover depending on the needs of the group.
Retirement, disability or withdrawal benefit: Gratuity benefit shall be payable under Shriram Life New Group Gratuity Plan.
Death benefit: Lump sum life cover and gratuity benefit are payable upon the demise of a member.
Payment of gratuity benefits: Gratuity benefits will be paid as and when policyholder requests it. Gratuity payment is limited to the policyholder's fund value.
Payment of insurance benefits: Insurance benefits will be paid to the nominee within 1 month of receiving valid claim forms from the policyholder.
New members: New members can join on the 1st of the month.
Fund options: The plan has 3 fund options with different risk-return patterns:
||Equity related - not more than 30%
Debt, money market instruments, and cash - not less than 70%
||Steady flow of income expected
||Low to medium
||Equity related - not more than 50%
Debt, money market instruments, and cash - not less than 50%
||Balanced expected returns
||Equity related - not more than 60%
Debt, money market instruments, and cash - not less than 40%
||High expected returns
||Medium to high
Initial contribution: It can be made in 1 lump sum or maximum 5 annual instalments.
Regular contribution: It can be nil if the fund is overfunded or in surplus, the policy will continue without lapsing as per Actuary's certificate submitted by the employer.
Switching option: Policyholder can switch units between funds depending on his or her varying investment needs. No switching charges will be levied. There is no limit on the number of switches you can make per year.
Premium redirection: The contribution can be redirected between funds at any proportion at the discretion of the policyholder. There is no charge levied for premium redirection.
New Unit Linked Fund: The Company can establish new unit linked fund from time to time as approved by the IRDAI. The policyholder will be notified and given the option to switch to the New Unit Linked Plan.
Closer of existing Unit Linked Fund: The Company may close any funds with approval from the IRDAI. The policyholder will be given 4 weeks’ notice to switch funds.
Charges: Listed below are the various charges applicable under Shriram New Group Gratuity Plan:
Surrender charges: If the policy is surrendered within 3 years from policy commencement, a surrender charge of 0.5% if the fund, subject to a maximum of Rs.5 lakhs is levied. No surrender charges are applicable if the policy is surrendered after 3 years.
Fund Management Charge: NAV of each fund will be calculated daily adjusting a fund management charge of 0.4% p.a. plus Service Tax. Fund management charges can be revised, subject to a maximum of 1.35% p.a. with approval from the IRDAI.
Premium allocation charge: 2% of contributions plus Service Tax, subject to a maximum of Rs.2 lakhs p.a. plus ST. Premium allocation charge and mortality charge are guaranteed for policy term of 1 year.
Mortality charge: This charge will be collected every year for life insurance cover. It depends on the age, occupation, and geographical location of the member.
Riders / Add-On Plans – Additional coverage under the Shriram Life New Group Gratuity Plan:
Pay an additional premium for Shriram Group Critical Illness Rider and get enhanced protection under Shriram Life New Group Gratuity Plan.
Exclusions - What the Shriram Life New Group Gratuity Plan doesn’t cover?
Shriram Life New Group Gratuity Plan doesn't cover death by suicide. If a member commits suicide within 1 year from policy commencement or revival date, 80% of the mortality charges as well as gratuity benefit will be paid to the nominee.
Other Key Features – Freelook Period, Surrender Values, Grace Period etc.
Listed below are the key features of Shriram Life New Group Gratuity Plan:
||From the date of receipt of the policy document, you are given 15 days to review the terms and conditions of the policy. If you have any objection to the terms and conditions, you have the option to return the policy. For policies purchased through distance marketing, the free-look period is 30 days. The fund value will be paid after deducting mortality charge, medical examination charge, etc.
||A grace period of 15 days for monthly mode and 30 days for half-yearly and quarterly modes is applicable under this plan. If mortality charges aren’t paid within the grace period, then life cover and insurance benefits aren’t payable. There is no grace period for annual mode.
||Policy can be revived within the policy term of 1 year by paying the mortality charges and submitting a written request for revival.
||Change of payment mode and life cover amount can be made at annual renewal date.
||Policy will be terminated under the following conditions:
- Policy surrender
- Insufficient funds to pay gratuity benefit
- Termination of membership
||A membership can be terminated from the group plan under the following conditions:
- Demise of the member
- Job resignation
- Master policy surrender
Tax Benefits – How you can save with the Shriram Life New Group Gratuity Plan?
Under Shriram Life New Group Gratuity Plan, you can get the following tax benefits:
- Tax benefits to employees:
- Gratuity payment up to Rs.10 lakhs or half a month salary for every year of service, whichever is lower, is exempt from tax under Section 10(10D) of the Income Tax Act, 1961.
- Life insurance claim is exempt under Section 10(10D) of the Income Tax Act, 1961.
- Tax benefits to employers:
- Profits earned from investments made in an approved gratuity fund is exempt from tax under Section 10(25) of the Income Tax Act, 1961.
- Initial contribution to the extent of 8.33% of the salary to approved gratuity funds made by the employer can be used for tax deduction under Section 36(1)(v) of the Income Tax Act, 1961.
Other Benefits – How you can save with the Shriram Life New Group Gratuity Plan?
There are several other benefits of purchasing group insurance plans from Shriram Life Insurance such as:
- Online application: Through the company website, you can purchase insurance policies offered by Shriram Life Insurance online.
- Premium calculator: Calculate premiums easily using the online premium calculator available on the company website.
- Premium payment: Premium payments can be made through multiple channels including netbanking, credit card, and debit card.
- Customer support: For insurance related queries, you can mail to firstname.lastname@example.org.
- Grievance redressal: The Company has a dedicated grievance redressal cell for complaints and grievance redressal. Call toll-free number 1800 3000 6116.
Why should you buy Shriram Life New Group Gratuity Plan from Shriram Life Insurance?
Listed below are the various reasons why you should buy Shriram New Group Gratuity Plan from Shriram Life Insurance:
Shriram Life Insurance has over 528 branches across India and caters to over 14 million customers.
- The company has experience managing over Rs.1,020 crores in revenue.
- Shriram Life Insurance won the 'Best Life Insurance Company' award in the private sector in 2016.
- In the same year, it also won 'The Indian Insurance Award' for the best non-urban coverage.
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