HDFC Life Wealth Builder Plan

What is the HDFC Life Wealth Builder Plan?

HDFC Life Wealth Builder Plan is a unique single premium Unit Linked Insurance Plan (ULIP). With this investment plan, you make a one-time lump-sum payment and have the flexibility to choose a life insurance cover up to 10 times the single premium amount. 

You also have maturity return benefits from market-linked investment options over 5 or 10 years. Additionally, you can self-manage your savings by selecting from a variety of unit-linked funds and investment strategies tailored to your risk preferences.

Features of HDFC Life Wealth Builder Plan

• Single Premium Payment: You pay a one-time lump sum amount.

• Policy Term: Choose either 5 or 10 years.

• Life Insurance Cover: Get life insurance coverage for the entire policy term. The death benefit is paid out to your nominee if you die during the policy term.

• Investment Potential: Invest your money in unit linked funds. The returns are market-linked, which means they depend on the performance of the stock market.

• Choice of Funds: Choose from 8 different unit linked funds to suit your risk appetite.

• Free Fund Switches: You can switch between funds unlimited times without any charges.

• Maturity Benefit: On maturity, you receive the fund value, which is the market value of your units. 

• Return of Mortality Charges: In case of a 10 year policy term, 50% of the mortality charges are returned as well.

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Eligibility Criteria

Benefits of HDFC Life Wealth Builder Plan

The HDFC Wealth Builder Plan offers the following key benefits:

1. Maturity Benefit:

   Policy Term of 5 years:

   • Receive the fund value on the maturity date.

   • Fund Value = NAV at maturity X number of units at maturity.

   Policy Term of 10 years:

   • Fund Value on Maturity: Calculated as NAV at maturity X number of units at maturity. 

   • 10-year Loyalty Benefit: 50% of total mortality charges deducted during the policy term (excluding GST) added to the fund value.

2. Options for Utilizing Maturity Benefit:

   The following two options are available to utilize the maturity benefit as per the chosen policy term:

   • Lump Sum: Receive the entire maturity benefit as a lump sum.

   • Settlement Payout: Receive part of the maturity benefit as a lump sum and the rest in equal instalments over 5 years after maturity.

3. Death Benefit:

   The HDFC Life Wealth Builder Plan offers the higher of the following:

   • Sum Assured or 105% of premiums paid or fund value.

   • Payable to the beneficiary in case of death during the policy term.

4. Non-Negative Claw-Back Additions:

   Specified non-negative claw-back additions may be added to fund value after the first five policy years.

5. Partial Withdrawal Benefit:

   Unlimited partial withdrawals are allowed after 5 Policy Years.

6. Fund Switching:

   Unlimited free switches between funds are allowed during the policy term.

7. Settlement Payout:

   Receive maturity amount partially in a lump sum and balance in installments over 5 years.

8. Surrender/Policy Discontinuance:

   Flexibility to surrender policy during the term for surrender benefits.

9. Tax Benefits:

   • Eligible for tax benefits under Sections 80C and 10(10D) of the Income Tax Act, 1961.

   • Tax benefits are applicable on premiums paid and maturity proceeds.

   • Policyholders below 44 years can choose Sum Assured as 1.25 or 10 times the single premium for tax benefits.

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Investment Strategies in HDFC Life Wealth Builder Plan

• Custom Investment Choices: Choose from 8 unit-linked funds with varying debt-to-equity ratios to match your risk tolerance and financial goals.

• Automatic Portfolio Adjustment: This predefined strategy ensures your portfolio adapts as your goals change, reducing equity exposure as your policy matures. This protects your investment from potential downturns in the equity market without requiring your manual intervention.

• Smart Wealth Protection: You can safeguard your wealth from market fluctuations with this methodical approach. It uses a rupee cost averaging method, particularly beneficial if you prefer gradual investment in equities. This strategy operates for the initial 36 months of your chosen policy term. If you opt for this plan, the received Single Premium, after deducting the Premium Allocation Charge, will be first allocated to the Individual Preserver Fund to purchase Units.

Policy Details of HDFC Life Wealth Builder Plan

The key policy details of this best investment plan are as follows:

1. Free Look Period:

   • You can cancel the policy within 15 days (30 days for Distance Marketing) if you disagree with the terms.

   • Refund includes non-allocated premium, cancellation charges, fund value at cancellation date, minus fees and charges.

   • All benefits and rights terminate immediately upon cancellation.

2. Policy Commencement:

   • Policy starts immediately from its commencement date.

   • If the Life Assured is under 12 years old, full death benefit begins from the last day of the 2nd policy year.

   • No mortality charges are levied until the start of full death benefit.

3. Assignment Provisions:

   • Assignment must comply with Section 38 of the Insurance Act 1938, as amended.

4. Nomination Provisions:

   • Nomination must comply with Section 39 of the Insurance Act 1938, as amended.

   • Calculation formula provided for nomination.

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How Does the Plan Work

Step 1: Choose your desired policy term, premium amount, and sum assured for your life insurance cover.

Step 2: Select an investment strategy or fund where your premium will be invested.

Step 3: Enjoy the benefits:

• Provide financial protection to your family in case of an unfortunate event.

• Maximize your returns by managing your funds through fund switching.

• Achieve your interim financial goals at various milestones through partial withdrawals.

Step 4: Financial Benefits:

• Upon maturity, receive the maturity amount based on the chosen maturity option.

• In the unfortunate event of the life assured's death, the life insurance cover will be paid to the beneficiary.

Exclusions

If the policyholder dies by suicide within 12 months of starting the policy or its revival, the nominee will receive the fund value as of the date of death notification. Additionally, any charges, except Fund Management Charges (FMC) and guarantee charges, imposed after the death date will be reimbursed and added back to the fund value.