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Step 1 – the policyholder chooses the Guaranteed Maturity Benefit, the plan term, premium paying term and frequency. Based on the insured’s age and the above factors, the premiums are calculated.
Step 2 – There are three payout options for availing maturity benefit after the completion of the plan tenure and the policyholder has to choose one option.
Step 3 – in case of death, the death benefit would be paid.
Step 4 – if the insured survives the plan tenure, the maturity benefit is paid according to the chosen cash instalment option.
Bisht, aged 35 years, buys Young Assure Plan and chooses a Guaranteed Maturity Benefit of Rs.2.5 lakhs. The term is 15 years and premiums are paid annually throughout the plan tenure.
Option 1 – if Bisht chooses instalment option I, he would be paid the Guaranteed Additions, vested bonus and any interim bonus on maturity. In the second year after maturity, Rs.1.25 lakhs is paid and in the next year Rs.137,500 is paid.
Option 2 – In case of Option II, Guaranteed Additions, vested bonus and any interim bonus are paid on maturity. From the second year and every year thereafter till 5 years, 22%, 25%, 28% and 34% of Guaranteed Maturity Benefit is paid. In the final payment, any terminal bonus is also paid.
Option 3 – For Option III, 12%, 15%, 18%, 20%, 23% and 25% of the Guaranteed Maturity Benefit is paid every year for 7 years respectively.
Option 4 – in case of death, the death benefit is paid and future premiums are waived off. The plan earns Guaranteed Additions and bonuses. On maturity, the maturity benefit is paid.
|Instalments payable||Option I – the benefit is paid over 3 years post maturity||Option II – the benefit is paid over 5 years post maturity||Option III - the benefit is paid over 7 years post maturity|
|In the 1st year||Guaranteed Additions + vested bonuses + any interim bonus|
|In the 2nd year||50% of GMB||22% of GMB||12% of GMB|
|In the 3rd year||55% of GMB + any terminal bonus||25% of GMB||15% of GMB|
|In the 4th year||NA||28% of GMB||18% of GMB|
|In the 5th year||NA||34% of GMB + any terminal bonus||20% of GMB|
|In the 6th year||NA||NA||23% of GMB|
|In the 7th year||NA||NA||25% of GMB + any terminal bonus|
|Premium paying terms||Guaranteed Additions|
|Age at entry (in completed years)||18 years||50 years|
|Age at maturity (in completed years)||28 years||60 years|
|Term of the plan||10,15 or 20 years|
|Premium paying options||Regular or limited pay|
|Premium Paying term||For term 10 years – 5 or 7 years
For term 15 years – 12 or 15 years
For term 20 years – 12, 15 or 20 years
|Sum Assured||10 times the annual premium|
|Guaranteed Maturity Benefit||Rs.1 lakh||No limit|
Below are the sample rates of premium payable by a non-tobacco user male for a combination of different ages, term and premium payment term. The Guaranteed Maturity Benefit is taken to be Rs.2 lakhs.