Canara HSBC OBC Life Smart Monthly Income Plan

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Introduction/Overview

The Canara HSBC OBC Life Smart Monthly Income Plan is a life insurance plan that is savings oriented and has bonus facility. This policy helps policyholders to create a legacy for their children with a life cover of twenty-five years. With this policy, the policyholders enjoy a supplemented monthly income, which they can use for realizing their loved ones’ dreams and aspirations.

Key Features

  • The policy is a traditional participating money-back plan with bonus facility
  • The policy helps to generate wealth for future financial requirements.
  • Policyholders receive guaranteed annual income for fifteen years.
  • The policyholder has to pay premiums for a limited period of ten years while enjoying coverage for twenty-five years.
  • Along with the Death Benefit that is paid to the nominee, the policy offers an additional benefit in the form of a Maturity Benefit for policyholders who survive until the end of the policy term.

Benefits

  • If the policyholder survives until the policy matures, he or she receives a Maturity Benefit, which is the sum of all annual Simple Reversionary Bonuses and Terminal Bonus (if any).
  • In the unfortunate event of the demise of the policyholder, the nominee receives a Death Benefit.  The Death Sum Assured is the higher of the Sum Assured or ten times the Annualized Premium. The Death Benefit that is paid to the nominee is the Death Sum Assured plus any added annual bonus provided in the year of death and final bonus, subject to a minimum of 105% of the premiums paid by the policyholder.
  • The policy gives a Guaranteed Income Benefit in which the company pays a monthly income for fifteen years, starting from the end of the 121st policy month and continues till the end of the policy term.
  • Tax benefits are available on the premium paid and Death Benefit as per sections 80(C) and 10 (10D) of the Income Tax Act.
  • The policy offers rebates on high Sum Assured amounts.
  • Bonuses (Simple Reversionary Bonus and Terminal Bonus) are added to the policy at the end of every financial year provided all premiums have been paid.

Product Specification:

 

Minimum

Maximum

Entry Age of the Policyholder (Last Birthday)

18 years

55 years

Maturity Age (Last Birthday) of the Life Assured

43 years

80 years

Policy Term (PT) in years

25 years

Premium Paying Term (PPT) in years

Limited Pay – 15 years

Premium Paying Frequency

Monthly

Annual

Monthly Premium

Rs. 2000

No Limit

Sum Assured

100 times the chosen Monthly Premium

No Limit

Details About Premium

Benefit illustration for 45-year-old male. Guaranteed Monthly Income of Rs. 10000. Life coverage of Rs. 1000000.

 

 

 

Guaranteed Benefits

Non-Guaranteed Benefits

Policy year

Age at the beginning of the year

Annualized Premium (Rs.)

Death Benefit (Rs.)

Annual Income (Rs.)

Surrender Value (Rs.)

Accumulated Bonus at an assumed investment return of 8% p.a.

1

45

103000

1030000

0

0

0

2

46

103000

1030000

0

0

0

3

47

103000

1030000

0

92700

0

4

48

103000

1030000

0

206000

120000

5

49

103000

1030000

0

257500

150000

6

50

103000

1030000

0

309000

180000

7

51

103000

1030000

0

360500

210000

8

52

103000

1030000

0

428480

240000

9

53

103000

1030000

0

500580

270000

10

54

103000

1030000

0

576800

300000

11

55

103000

1030000

120000

537140

330000

12

56

103000

1030000

120000

501600

360000

13

57

103000

1030000

120000

470180

390000

14

58

103000

1030000

120000

442880

420000

15

59

103000

1030000

120000

419700

450000

16

60

0

1030000

120000

330600

480000

17

61

0

1030000

120000

241500

510000

18

62

0

1030000

120000

152400

540000

19

63

0

1030000

120000

63300

570000

20

64

0

1030000

120000

 

630000

21

65

0

1030000

120000

 

660000

22

66

0

1030000

120000

 

690000

23

67

0

1030000

120000

 

720000

24

68

0

1030000

120000

 

750000

25

69

0

1030000

120000

Final Maturity at Bonus

800000

 

 

 

 

 

Total Bonus

1550000

Policy Details

Grace Period: The policy gives policyholders thirty days to pay all due premiums.

Policy Termination or Surrender Benefit: The policy acquires Surrender Value after the full premium payment of the first three policy years. If the policy is not reinstated within the revival period, the policy is terminated. Termination of the policy also occurs on payment of the Maturity benefit or the Death Benefit.

Free Look Period: Policyholders have a limited free look period of 15 days from the date of receiving policy documents to review the policy. If the policyholder does not wish to continue with the policy, then he or she can cancel the policy. The company will refund the premium paid minus a proportionate premium for the risk borne by the company, including as any extra expenses, such as towards a medical examination or stamp duty charges.

Inclusions

  • A policy loan is available once the policy acquires Surrender Value. The minimum loan amount is Rs. 20000 and cannot exceed 80% of the Surrender Value.

Additional Features or Riders

  • If the premiums for three policy years are not paid within the Grace Period, the policy will lapse.
  • If policyholders pay the premiums for the first three policy years but subsequently no further premiums are paid, the policy acquires Paid- up Value at the end of the Grace Period.
  • The revival of a lapsed or discontinued policy is possible if the policyholder submits a request for reinstatement within a timeframe of two years from the date of the first unpaid premium and pays all due premium

Exclusions

  • The term insurance cover is void if the person insured, whether sane or insane at the time, commits suicide within one year from the start of the policy cover. The company will refund 80% of the premiums paid. If the suicide takes place within one year of policy reinstatement, the company will refund the higher of 80% of the premiums paid or the Surrender Value.

Documents Required

The policyholder has to fill up an ‘Application form ’with identity proof, bank account proof, address proof and a recent photograph. Select cases may require income proof and medical examination.