Kotak Premier Endowment Plan

Overview

A traditional participating endowment assurance plan which focuses on turning long term savings into funds that aid in financial security and fulfilling future needs. The plan provides a life cover that ensures any exigencies are dealt with in a better manner. This plan comes with regular or limited premium payment terms and is meant for people who wish their savings to return greater profits and get a lump sum value through regular savings over a longer period.

Eligibility Conditions for Kotak Premier Endowment Plan

The plan could be of a tenure as low as 10 years and as high as 30 years and as per those, the eligibility conditions for availing this policy can be depicted in the table mentioned below -

Key Features of Kotak Premier Endowment

This plan meant for financial security planning has the following salient features -

Benefits and Advantages of Premier Endowment Policy

This plan from Kotak Life Insurance is aimed towards furthering long term savings and helps in building a corpus for a secure financial future. Life insurance provided by this policy throughout the policy term is an added benefit. The advantages of this plan can be outlined as the following -

1. Life cover is present throughout the policy term
2. Flexible long term policy tenures that aid in a better financial planning
3. Regular additions and bonuses allow for a btter return on savings done through premiums
4. Limited premium payment options help in case of financial constraints
5. Applicable tax benefits can be availed as per Sections 80C, 80D and 10(10D) of the Income Tax Act

The key benefits under this policy can be explained as below -

1. Maturity Benefit - After the policy tenure is over or it reaches the maturity age, this amount can be paid to the policyholder or nominee. The maturity benefit includes the Sum Assured along with the accrued Guaranteed Additions and if applicable, accrued Reversionary Bonuses, Interim Bonus and Terminal Bonus
2. Death Benefit - In case of the death of the insured life, the Minimum Death Benefit will be payable to the nominee. Accrued Guaranteed Additions, Reversionary Bonuses, Interim Bonus and Terminal Bonus if any, will also be payable. The Minimum Death Benefit (MDB) is calculated as per two different options -
   1. If Entry Age is less than 45 years, the MDB will be the higher of sum assured, 11 times annualised premium or 105% of the total premiums paid till the date of demise
   2. If Entry Age is more than or equal to 45 years, the MDB will be the higher of sum assured, 7 times annualised premium or 105% of the total premiums paid till the date of demise
3. Policy Loan - Once the policy has attained a surrender value, post premium payment of 2 years or 3 years (as the case may be), a loan of up to 80% of the surrender value can be availed
4. Surrender Benefit - In case 2 or 3 years’ premiums have been paid in full, the policy would acquire a Guaranteed Surrender Value and the same will be paid to the policyholder. If a Special Surrender Value decided by the insurer is higher than the GSV, the policyholder would be entitled to the same
5. Tax Benefit - The contributions made towards the premiums of this policy can be tax deductible as per Sections 80C, 80D and the received benefits can fall under Section 10(10D). These benefits are dependent on the prevailing tax laws

Kotak Life Premier Endowment Policy in Action

Ankit, aged 35 years, decides to go for a 15 years term of Premier Endowment Policy. He opts for a regular premium payment term and thus needs to pay the premium for a period of 15 years regularly for a Basic Sum Assured of INR 5,00,000. The following table illustrates the various benefits that would be payable for the policy under the given terms and conditions -

As can be seen from the table above, for a sum assured of Rs. 5,00,000, Ankit will need to pay an annual premium of Rs. 40,460. All the figures mentioned in this example are exclusive of taxes and charges that might be added by the insurer.

Optional Riders under Kotak Life Premier Endowment Plan

The following riders can be availed optionally under the Premier Endowment Policy so as to get a more comprehensive coverage.

Premium Payment for Kotak Life Premier Endowment Plan

The details of premium payment for this plan can be summarised in the table below -

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