Kotak Invest Maxima Plan

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Introduction/Overview

The Kotak Invest Maxima Plan is Unit Linked Insurance Plan that helps policyholders to channel and actively maintain their investments while simultaneously generating wealth for themselves. This plan helps the policyholders to make the most of their money while providing a systematic entry into the volatile equity market. Through features such as Survival Units, Maturity Benefit, and Death Benefit, the policyholder can be satisfied that they have secured their financial future and that their loved ones will also be well protected in their absence.

Key Features

  • Depending on the portfolio strategy chosen, the policyholder has a choice of either two or five different funds in which to allocate their investments.
  • Liquidity of funds is available in the form of partial withdrawals.
  • The policyholder may top- up his or her premium with a lump sum amount.
  • Policyholders are given two options for managing their investment portfolios, either directly through the Self Managed Portfolio Strategy or through the Systematic Switching Strategy.
  • Wealth is generated, and long-term investment is rewarded through the application of Survival Units in this policy.

Benefits

  • If the policyholder survives until the policy matures, he or she receives a Maturity Benefit, which is the Fund Value as on the maturity date.
  • .  The  Death Benefit is the higher of:
  1. The Fund Value, or
  2. The Base Sum Assured minus any partial withdrawals, or
  3. 105% of the total premiums paid.

Plus the higher of the Top-up Sum Assured or the Fund Value in the Top- up account or 105% of the Top- up Premium.

  • The policy offers two portfolio strategies for its policyholders:
    • Self Managed Portfolio Strategy gives policyholders the flexibility to manage and maintain their investment portfolio independently with an option of five different funds.
    • Systematic Switching Strategy allows policyholders to engage in volatile equity markets in an organized and systematic manner. This portfolio strategy offers two funds for investments.
    • The policy provides additional benefits for long-term savings by providing Survival Units every five years, starting from the eleventh policy year onwards.
    • Liquidity is available in the form of partial withdrawals, which are allowed after the first five policy years are completed. The minimum amount for partial withdrawals is Rs. 10000.
    • Tax benefits are available on the premium paid and Death Benefit as per sections 80(C) and 10 (10D) of the Income Tax Act.

Product Specification:

 

Minimum

Maximum

Entry Age of the Life Assured (Last Birthday)

0 years

65 years

Maturity Age (Last Birthday) of the Life Assured

10 years

75 years

Policy Term (PT) in years

Regular Premium - 10 years, 15 years, 20 years, 25 years, 30 years

Limited Premium - 10 years, 15 years, 20 years, 25 years, 30 years

Single Premium – 10 years

Premium Paying Term (PPT) in years

Single Premium, Regular pay

Limited Period of 5 years for 10 years PT

Premium Paying Frequency

Annual and Single

Annual Premium

Regular Pay: Rs. 50000

Limited Pay: Rs. 75000

Single Pay : Rs. 100000

Regular Pay: Rs.100000

Limited Pay: Rs. 100000

Single Pay : Rs. 250000

Sum Assured

Regular and Limited Premiums :

Entry age less than 45 = Higher of (10 X Annual Premium) or (0.5 X Policy Term X Annual Premium)

Entry age more than 45 = Higher of (7 X Annual Premium) or (0.25 X Policy Term X Annual Premium)

Single Premium: Option 2 = 1.25 X Single Premium

Regular and Limited Premiums:

25 X Annual Premium

 

Single Premium: Option 1 = 5 X Single Premium

 

 

Details About Premium

Benefit illustration @8%

Age (Yrs)

Policy Term (Yrs)

Annual Premium (Rs.)

Premium Allocation Charge (Rs.)

Mortality Charges (Rs.)

Policy Admin Charge (Rs.)

Additions to the Fund (Rs.)

Fund Management Charge (Rs.)

Fund at the end (Rs.)

Surrender Value (Rs.)

Death Benefit (Rs.)

30

1

95000

0

2608

6000

 

1094

91074

84845

1950000

31

2

95000

0

2478

6000

 

2205

188277

183945

1950000

32

3

95000

0

2397

6000

 

3391

291953

288704

1950000

33

4

95000

0

2327

6000

 

4655

402512

400346

1950000

34

5

95000

0

2265

6000

 

6003

520398

520398

1950000

35

6

0

0

2355

0

 

6326

551759

551759

1950000

36

7

0

0

2459

0

 

6708

585055

585055

1950000

37

8

0

0

2579

0

 

7113

620394

620394

1950000

38

9

0

0

2711

0

 

7543

657896

657896

1950000

39

10

0

0

2851

0

13173

7999

710865

710865

1950000

39

11

0

0

3005

0

 

8643

753955

753955

1950000

39

12

0

0

3169

0

 

9168

799679

799679

1950000

39

13

0

0

3274

0

 

9724

848277

848277

1950000

39

14

0

0

3367

0

 

10316

899955

899955

1950000

39

15

0

0

3484

0

18021

10945

972906

 

 

 

Policy Details

Grace Period: The policy gives policyholders thirty days to pay all due premiums. This timeframe is reduced to 15 days in case of premiums being paid via monthly mode. The policy will acquire a “Discontinued” status if payment is not made within the applicable timeframe.

Policy Termination or Surrender Benefit: If the policy is surrendered before the completion of 5 years, then the insurance cover ceases, and the Fund Value will be transferred to the Discontinued Policy Fund. Proceeds from this will be payable only after the fifth policy anniversary. In case of the death of the Life Assured during this period, only the accumulated fund value will be payable to the nominee. After completing five policy years, if it is surrendered, then there is no Surrender/Discontinuance Charges, the Fund Value is paid to the policyholder, and the policy will terminate immediately. 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 customer will receive the Fund Value plus the unallocated premium 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 Top-up premium is permitted any time during the policy term, except the last five policy years, on the condition that all premiums have been paid. The minimum Top-up premium amount is Rs. 20000.
  • The policyholder may switch between the unit-linked funds at any point of time during the policy term.
  • The policyholder may increase or decrease the Base Sum Assured as per their changing life coverage. This change can be done only at policy anniversaries.
  • Policyholders may opt to change the allocation of future premiums with the Premium Redirection facility.
  • The policyholder can choose to receive the maturity benefit as an immediate lump-sum payout or through pre-selected for a period of up to five years after the maturity date. The policyholder may also receive the maturity benefit as a part lump-sum amount and the rest via installments.
  • As part of the Systematic Switching Strategy, the policyholder may opt for the Systematic Exit Strategy or the SES. The SES gives them a choice to move the amount from one of the two linked funds to the Money Market Fund over a twelve-month timeframe in a systematic manner.

Additional Features or Riders

  • 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 discontinuance. The revival of lapsed policies is applicable only on Regular and Limited premium payment policies.
  • Various charges apply to this policy. They are as follows:
  1. There is a zero Premium Allocation Charge in this policy.
  2. Policy Administration Charge is deducted at the start of each month.
  3. Fund Management Charges are deducted daily while calculating the NAV of the funds.
  4. At the beginning of each month, Mortality Charges are deducted by the cancellation of units from the fund value.
  5. Switching Charge – There is a limit of fifteen free switches allowed in a single policy year. Subsequently each switch is charged at Rs. 500 per switch.
  6. Partial Withdrawal Charge is Rs.500 per withdrawal.
  7. Miscellaneous Charges – for policy alteration Rs. 500 is charged, while Rs. 100 is charged for premium redirection.
  8. A Discountenance Charge is levied on policies that are discontinued before the end of the lock-in period of the first five years.

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 the Fund Value as on the date of death. If the person insured commits suicide within one year of policy reinstatement when the revival has been done within six months from the date of discontinuance the Death Benefit is paid to the nominee. . If the person insured commits suicide within one year of policy reinstatement when the revival has been done after six months from the date of discontinuance, the Fund Value is paid to the nominee

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.