HDFC Life Group Credit Protect Plus Insurance Plan

Some of the key features of HDFC Life Group Credit Protect Plus Insurance Plan are mentioned below.

Benefits/Advantages of HDFC Life Group Credit Protect Plus Insurance Plan

Some of the major benefits of are mentioned below.

1. Multiple plans - One can choose from six plans under this scheme, each offering unique features and benefits.
2. Simple administration - Implementing this plan is quick and simple, with support provided by the team in case of any confusion.
3. Flexible - Members can choose a term which suits their need, with the term ranging between 2 and 30 years.
4. Top-up cover - There is a provision to provide cover for top-up loans.
5. Death benefit - Members are entitled to a death benefit in the event of their demise while the policy is in place. This death benefit can either be decreasing or level, i.e., the sum assured reduces with each repayment or remains the same throughout the policy tenure.
6. Moratorium - Members can opt for a moratorium when they take certain loans, with a cover provided during this period.
7. Surrender benefits - A surrender benefit can be paid to a member in the event of him/her prepaying the loan.
8. Tax benefits - Members are entitled to tax benefits under Section 80C and D of the Income Tax Act.
9. Underwriting - Underwriting formalities are kept to a minimum, ensuring customers aren't inconvenienced.

Working of HDFC Life Group Credit Protect Plus Insurance Plan

Being a group plan, one might think that the working would be complicated, but contrary to this belief, it is easy to understand how this plan works. Let us take the example of Miss Rita, aged 35 years to understand this concept. Miss Rita takes a loan of Rs 50,000 from a financial institution, with the repayment tenor being 5 years. Now, her financial institute provides protection to its members through the HDFC Life Group Credit Protect Plus Insurance Plan and enrols Miss Rita in the same. After paying the single premium, she is protected for her repayment tenor. Under this scheme, the master policy is held by the financial organisation, with Miss Rita as a member.

The plan Miss Rita chooses has an additional Accidental Death Benefit rider and an Accelerated Terminal Illness Benefit rider, offering enhanced protection. Now three years into the plan, Miss Rita meets with an accident and passes away. In this case, her insurance cover kicks in and her nominee will receive a death benefit, which can be used to clear the loan.

In case nothing happens to Miss Rita, after the 5 year period her policy will lapse. If Miss Rita chooses to prepay the loan then she can get a surrender benefit which is computed after taking multiple factors into account.

Premium Payment

This is a single premium payment plan, wherein a member is expected to pay the premium amount only once, at the time of joining the scheme.

Riders

This plan comes with a number of customisable options, ensuring that members can find a solution which suits their individual needs. Members can choose from the following four riders to enhance their policy.

1. Additional Accidental Death Benefit - If the policyholder passes away while the policy is in place, his/her nominee will receive an additional accidental death benefit equivalent to the sum assured or decreasing sum assured, depending on the policy chosen.
2. Accelerated Terminal Illness Benefit - In the event of a member being diagnosed with a terminal illness, he/she will receive either the sum assured or the decreasing sum assured, depending on the policy in place. This rider comes with a term of either 5 years or 10 years.
3. Accelerated Critical Illness Benefit - If a member is diagnosed with a critical illness (as per the guidelines of the company), he/she will be eligible to get the sum assured, either through the level scheme or decreasing scheme, as chosen in the policy.
4. Accelerated Total Permanent Disability - In the event of a policyholder being in a situation which leaves him/her permanently disabled, he/she will be eligible to get either the decreasing sum assured or the sum assured, depending on the policy opted for.

The policy will cease after the policyholder or his/her nominee receives the sum assured in all cases.

GST of 18% is applicable on life insurance effective from the 1st of July, 2017