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  • SBI Life - Smart Money Planner

    SBI Life

    Overview

    The Smart Money Planner is a participating savings plan that offers the policyholder the benefits of an SBI life insurance plan along with the benefit of a source of regular income that can be used to deal with upcoming expenses. It features a choice of 4 different plans to choose from and also comes with surrender, death and maturity benefits. Even the premiums payable towards this plan offer benefits like limited pay options, regular payment options or lump sum payments. It also offers rebates in the premiums when the sum assured is higher and allows policyholders to take loans against the policy.

    Eligibility Conditions of SBI Life - Smart Money Planner

    Entry age

    The minimum and maximum entry ages will depend on the plan that is being opted for. They will be:

    Plans

    Min Age

    Max Age

    Plan 1

    18 years

    60 years

    Plan 2

    18 years

    55 years

    Plan 3

    18 years

    55 years

    Plan 4

    18 years

    60 years

    Maximum maturity age

    70 years

    Key Features of SBI Life - Smart Money Planner

    Type

    Participating traditional savings plan

    Sum assured

    • Minimum: Rs. 1 lakh
    • Maximum: Rs. Rs. 5 crore
    • For limited pay policies the minimum sum assured will be:
      • 10 time the premiums paid for those under 45 years of age at entry
      • For those over 45 years of age, 7 times the premiums paid.
    • For single pay policies the minimum sum assured will be:
      • 1.25 times the premium paid for those under 45 years of age.
      • 1.10 times the premium paid for those over 45 years.

    Coverage

    Death benefits: The death benefits payable under this policy will be the higher of the sum of the basic sum assured, terminal bonus and simple vested reversionary bonus and 105% of all the premiums paid.

    Maturity benefits: The maturity benefit of this plan is the sum of the guaranteed sum assured, terminal bonuses and the vested reversionary bonus.

    Basis

    Individual

    Premiums

    The premiums payable for this policy will depend on the plan opted for and the addition of any riders. They can either be paid as a single premium or for a limited period.

    Premium paying term

    The premium paying term differs for each plan under this policy.

    Paln

    Premium paying term

    Plan 1

    6 Years

    Plan 2

    6 Years

    Plan 3

    10 Years

    Plan 4

    10 Years

    Premium paying modes

    There are four ways to pay the premiums for this policy:

    • Single pay where the entire premium is paid as one lump sum.
    • Annual
    • Half-yearly
    • Quarterly
    • Monthly

    Policy term

    The policy term is determined by the plan that the policyholder takes:

    Plan

    Policy term

    Plan 1

    15 years

    Plan 2

    20 years

    Plan 3

    20 years

    Plan 4

    25 years

    Premium loading

    • For half-yearly premium payments policyholders will pay 52% of the annual premium.
    • For quarterly premiums it will be 26.5% of the annual premium.
    • For monthly payments 8.9% of the annual premiums will be paid.

    Growth period

    The growth period for each plan will be:

    Plan

    Growth period

    Plan 1

    4 years

    Plan 2

    4 years

    Plan 3

    5 years

    Plan 4

    5 years

    Benefit paying term

    The benefit paying term for each plan will be

    Plan

    Benefit paying term

    Plan 1

    5 years

    Plan 2

    10 years

    Plan 3

    5 years

    Plan 4

    10 years

    The benefits paid will be:

    Plan

    Benefit paying term

    Benefits (% of the basic sum assured)

    Plan 1

    5 years

    20%

    Plan 2

    10 years

    10%

    Plan 3

    5 years

    20%

    Plan 4

    10 years

    10%

    Policy validity

    The policy validity is the same as the policy term provided all premiums are paid and the policy does not lapse.

    Renewability

    Not Applicable

    Bonuses

    This policy offers two bonuses:

    • Vested simple reversionary bonus
    • Terminal bonus

    Other features

    • The freelook period will range from 15 days to 30 days.
    • The grace period for the payment of premiums for this policy is 30 days from the due date.
    • Growth period for single pay policies will be 10 years for plans 1 and 2 and 15 years for plans 3 and 4.
    • This plan also includes a suicide exclusion where if the policyholder commits suicide within 1 year of the policy, the death benefits will not be paid but 80% of the premium paid will be returned minus any cess and service tax.

    Add-on covers / Riders

    There are no riders for this policy.

    Benefits/Advantages of SBI Life - Smart Money Planner

    • Premiums paid towards this life insurance policy and the benefits received from them are eligible for tax benefits under sections 80C and 10(10D).
    • Once the policy has achieved a surrender value, policyholders can take a loan of up to 90% of that value.
    • Higher sum assureds get a rebate on the premiums. The rebate is a specific amount for every Rs. 1,000 of the sum assured. The rebates are:
      • For sum assured between Rs. 2 lakhs and Rs. 3 lakhs the rebate will be Rs. 20 for single pay and Rs. 2 for limited pay policies.
      • For a sum assured between Rs. 3 lakhs and 5 lakhs with be Rs. 3 for limited pay and Rs. 25 for single pay policies.
      • For a sum assured equal to or greater than Rs. 5 lakhs the rebate will be Rs. 5 for limited pay and Rs. 30 for single pay policies.
    • The policy also offers a guaranteed surrender value which ranges from 30% to 70% of the basic premiums paid. The availability of the benefit depends on the plan opted for and can start from the 2nd year or the 3rd year. The amount that will be returned will depend on the number of years for which the policy is held.

    How the Plan Works?

    Let us assume that Ram, who is 25 years old, opts for this policy and takes a cover of Rs. 50 lakhs. The plan he goes in for is Plan 2, the policy term is 20 years and the premium paying term is 6 years. The annual premium that he will pay is about Rs. 7,86,807. This means that his benefits will be:

    • Death benefit: these will be the base sum assured of Rs. 50 lakhs and the bonuses applicable. Which, if we assure 4% to 8% annual returns, will be between Rs. 14,95,000 to Rs. 34,50,000.
    • Maturity benefits: From the 11th year onwards he will get an amount of Rs. 5 lakhs every year along with the non-guaranteed benefits that will be the annual returns.
    • Surrender benefits: The surrender benefits will range from Rs. 4,56,120 to Rs. 27,36,720 between the 2nd and 11th year of the policy. Thereafter the benefits will reduce till the 16th year and won’t be available after the 16th year.

    Premium Payment

    The premium payable will be calculated based on the sum assure, plan selected and the premium paying term. They will also include any applicable taxes such as service tax. They can also be paid as a single premium or for a limited period of the policy term.

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