Kotak Headstart Child Assure Plan

Overview

As a responsible individual, you would want to provide the best of things to your children without compromising on your dignity. In this day and age of rising prices and overall inflation, you need to think beyond merely saving your hard-earned money. You would, therefore, do well to invest wisely in financial instruments which ensure that your children’s education is not jeopardized in the event of your unfortunate death. You can opt for one of the popular kotak Life child plans in India – the Kotak Headstart Child Assure Plan, a unit-linked insurance plan (ULIP). By opting for this plan, you can build a corpus to fund for your children's expenses sans worries. Under this plan, if the life insured dies, the nominee will get the triple benefit as listed below:

  • Basic sum assured is paid immediately
  • All future premiums will be added to the fund value
  • The policy will continue. Fund value will be paid at maturity

However, linked do not offer any liquidity in the first five years of the contract.

Eligibility Conditions of Kotak Headstart Child Assure Plan

Entry Age

18 to 60 years

Policy Term

10, 15 to 25 years

Key Features of Kotak Headstart Child Assure Plan

Type

Unit-linked non-participating endowment plan

Minimum Sum Assured

Entry age of below 45

Minimum: Higher of 10 x annualised premium or 0.5 x policy term x annualised premium

Entry age of 45 and above

Minimum: Higher of 7 x annualised premium or 0.25 x policy term x annualised premium

Maximum: 25 x annualised premium

 

Coverage

  • Death Benefit

    In the event of the death of the policyholder, the basic sum assured plus fund value subject to a minimum of 105% of total premiums till the time of death is payable. The reduced paid-up basic sum assured will be paid as lumpsum while premium waiver benefit will cease. Also, the reduced paid-up basic sum assured plus fund value will be subject to a minimum of 105% of total premiums paid.

  • Maturity Benefit

    Policyholders can take the full fund value at maturity or receive the maturity proceeds partly in cash and the balance in terms of instalments for up to five years after maturity.

  • Flexible Withdrawals

    Policyholders can access their investment after completion of the 5th policy year by way of partial withdrawals. For each partial withdrawal, Rs. 500 will be charged. Minimum amount for partial withdrawal is Rs.10,000.

Premium range

Minimum

Regular and 10 PPT

Yearly - Rs.20,000 p.a; half-yearly - Rs.10,000

5 PPT

Yearly - Rs.50,000 p.a; half-yearly - Rs.25,000

Maximum: No limit

Premium paying term

Regular

10, 15 to 25 years (equal to the policy term)

Limited

5 years for policy term 10 years

10 years for policy term of 15 to 25 years

Premium paying frequency

Annual and half-yearly

Loan

Not available under this plan

Freelook period

Customers can return the policy within 15 days from the date of receipt of policy.

Grace period

30 days from the due date of premium

Reinstatement

This plan can be revived until the expiry of the notice period. Policyholders can revive a discontinued policy within 2 years from the date of discontinuance.

Advantages of Kotak Headstart Child Assure Plan

Tax benefit

This plan offers tax benefits under section 80C and section 10 (10D) of the IT Act, 1961

Settlement options

This plan offers maturity proceeds in cash or selected instalments for up to five years after maturity. Customers have the following three options:

  • Maturity proceeds as an immediate payout
  • Part of the maturity proceed as a lump sum and part as instalments
  • Whole amount as instalments

Switching

Policyholders can switch between fund options or change their future premium allocation according to the their investment objectives

Funds

This plan offers a wide range of funds suitable for all types of investors. Customers can invest in fund options depending on their risk appetite and build a corpus. A team of qualified managers handle the portfolio. The funds offered by this plan are listed below:

  • Dynamic bond fund
  • Money market fund
  • Dynamic Floating rate fund
  • Dynamic gilt fund
  • Classic opportunities fund
  • Frontline equity fund
  • Balanced fund

Premium Payment

Regular premium

Minimum: Rs. 20,000 p.a

Limited premium payment

5 years minimum: Rs. 50,000

10 years minimum: Rs. 20,000

Premium allocation charge

Premiums

Policy year

   
 

1

2-5 years

6 onwards

Rs.20,000 to Rs. 1,99,999

6%

3%

2%

Rs.2,00,000 to Rs. 9,99,999

5%

   

Rs.10,00,000 and above

4%

   

How The Plan Works

Abhishekh Sarma, a 33-year-old businessman opts for for a policy term and premium payment term of 20 years, sum assured of Rs.5 lakh and an annual premium of Rs. 50,000. Sarma selects the Frontline equity fund. The table below displays the fund value and death benefit.

   

Non-Guaranteed Benefits at 8% *

   

Years

Age

Fund Value (Rs)

Death Benefit (Rs)

Premium (Rs)

10

45

6,27,220

1,628,320

5,00,000

15

50

1,120,000

1,870,000

7,50,000

20

55

1,788,510

10,00,000

*Net Yield is 6.06%

This Insurance Company has not partnered with BankBazaar.com. For more details, please visit its website/branch office. The trademarks, logos and other subject matters of intellectual property belong to their respective owners.

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

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