SBI Life Smart Wealth Builder Plan

What is SBI Life Smart Wealth Builder Plan?

The SBI Life Smart Wealth Builder Plan is an individual, unit-linked, non-participating ULIP plan with a policy term of 12-30 years. It provides the investor with 11 fund options. It combines the protection provided by life insurance with the long-term growth of market-linked investment. Investing in the SBI Smart Wealth Builder plan can help you meet goals such as your child’s education, marriage, housing, travel, and long-term wealth creation. It is considered one of the best ULIP plans where you can invest your money.

Key Features of Smart Wealth Builder Plan

Listed below are the key features of Smart Wealth Builder plan:

1. Premium Payment Term Flexibility

   While buying a new SBI Smart Wealth Builder plan, you can opt for different premium payment modes as mentioned below:

   Premium Payment Type	Premium Payment Term (PPT)	Details
   Single Premium	PPT= Pay once (Policy Term = 5-30 Years)	Pay the total premium amount only once at the time of buying the policy
   Regular Premium	PPT= Policy Term = 12-30 Years	Pay premiums periodically throughout the whole Policy Term (PT)
   Limited Premium	If Policy Term = 12-14 Years PPT= 7 Years If Policy Term = 15-19 Years PPT= 7/10/12 Years If Policy Term = 20-30 Years PPT= 7/10/12/15 Years	Pay premiums periodically for a few years of the policy term

2. Guaranteed Additions

   The SBI Wealth Builder Plan provides the feature of Guaranteed Additions, which further increases the SBI Life Fund Value to buy new units of the Fund.

   • Additions are higher for longer policy terms
   • Percentage of guaranteed addition depends on the policy term and the premium payment method

   This can be up to 125% of your annual premium if you choose a 30-year policy. These additions start as early as the 10th year and are added every 5 years after that, as long as your policy is active.

   

3. No Policy Administration Charges

   The Policy administration charge is capped at ₹500 per month, but does not apply for the first five years if you choose a regular or a limited premium plan.

4. No Allocation Charges

   After the 10th year, the insurer stops deducting allocation charges, ensuring more of your money goes into your fund.

5. Investment Flexibility

    You have a choice of 11 different fund options, so you can pick the one that best fits your investment goals.

6. Revival period

    The revival period is 3 years from the date of the first unpaid premium

Eligibility of SBI Wealth Builder Plan

Benefits of SBI Life Smart Wealth Builder

1. Maturity Benefits

   On survival of the life assured up to maturity, the Fund value shall be payable in lump sum.

   Illustration of the maturity benefits of SBI Smart Wealth Builder is as follows: 

   Premium Payment Type: Regular pay
   Policy Term: 30 years
   Premium Payment Term: 30 Years
   Premium Payment Frequency: Annually
   Investment Fund Type: 100% Equity Fund

   Age at Policy Purchase	35 years
   Premium	Rs. 50,000
   Sum Assured	Rs. 5,00,000
   Fund Value at Maturity (@ 4%)	Rs. 21,74,877
   Fund Value at Maturity (@ 8%)	Rs. 42,95,463

2. Life Cover Benefit (Death Benefit)

   In case of the death of the life assured while the policy is in force, the higher of the following will be paid:

   • Your Fund Value as on the date of death intimation.
   • Basic Sum Assured less Applicable Partial Withdrawals (APW).
   • 105% of the total Premiums received up to the date of death, less Applicable Partial Withdrawals (APW).

3. Guaranteed Additions

   In-force policies receive Guaranteed Additions at the end of the 10th policy year and every 5th year thereafter. The addition is a pre-specified percentage of one Annual Premium/Single Premium, depending on the plan type and policy year-end.

   For Regular Premium plans, the Guaranteed Addition percentages are:

   • 10th year: 5.00%
   • 15th year: 15.00%
   • 20th year: 25.00%
   • 25th year: 35.00%
   • 30th year: 45.00%

4. Reduced Charges over time

   Since there is no policy administration fee for the first 5 years of investment in the ULPI, along with no premium allocation charges levied from the 11th year of investment, the value of the fund has enhanced significantly while also making the fund attractive for investors. 

5. Flexibility in investment

   The Plan facilitates investing across 11 funds while allowing unlimited switching between funds, with the first two switches being free per annum, along with premium redirection to modify the reallocation of future premiums. The following table lists all the funds you can invest in under this scheme. 

   Fund	Risk
   Equity Fund		High
   Equity Optimiser Fund		High
   Growth Fund		High
   Balanced Fund		Medium
   Bond Fund		Low
   Money Market Fund		Low
   Top 300 Fund		High
   Bond Optimiser Fund		Medium
   Pure Fund		High
   Midcap Fund		High
   Corporate Bond Fund		Low

Additional Features of SBI Life Smart Wealth Builder Plan

Here are additional features of the policy, often compared with the best SIP plans for long-term wealth creation:

1. Grace Period

   30 days grace period is allowed for completing the premium payment.

2. Policy Termination or Surrender Benefit

   Policyholders are allowed to surrender the policy after 5 completed years.

   • If surrendered before 5 years, the fund value net of discontinuation charge will be credited to the Discontinued Policy Fund where it will earn a minimum of 4% p.a. growth. 
   • After completion of 5 years, the fund value in the Discontinued Policy fund as of that date will be paid to the policyholder.
   • If surrendered after 5 completed policy years, the entire Fund value on the date of surrender is paid without any charges.

3. Free Look Period

   If you are not pleased with the coverage and terms and conditions of the Smart Wealth Builder policy, SBI Life Insurance provides the option of cancelling the policy within 15 days of receipt of the policy documents and extends to 30 days if the plan is purchased through electronic channels or distance marketing, provided there has been no claim.

4. Policy Discontinuation Fund

   If the policyholder chooses to discontinue the Smart Wealth Builder Plan before the ULIP lock-in period is over, the deposited fund amount is accumulated in the Discontinued Policy Fund.

   The invested amount usually earns returns at a rate of 4% p.a., which is decided by the IRDAI.

5. Fund Switching Flexibility

   SBI Life Smart Wealth Builder Plan allows two free switches per policy year. However, all investors must note the following things:

   • Rs. 100 per switch is charged from the 3rd switch onwards in a policy year
   • No carry-forward of free switches is allowed to the next policy year
   • Minimum amount allowed for fund switching is Rs 5,000

6. Change in Sum Assured

   The Sum Assured can be increased or decreased from the 6th policy year.

7. Facility to Re-direct Premium

   From the 2nd policy year, policyholders can redirect their premium without any charges.

8. Partial Withdrawals

   The lock-in period for a Smart Wealth Builder SBI ULIP Plan is 5 years. After 6th policy year, policyholders can make partial withdrawals on the Fund Value.

   • Policyholders can make one partial withdrawal free of charge per policy year.
   • Rs. 100 has to be paid from the 2nd partial withdrawal onwards.
   • One cannot carry forward the free partial withdrawal to the next policy year.
   • Only 2 partial withdrawals per policy year and 10 partial withdrawals in a full policy term are allowed.

9. Fund Settlement Option

   The nominee can get the Death benefits in equal instalments over 2-5 years after the death of the policyholder.

   • The instalment pay-out can be made annually, half-yearly, quarterly or monthly.
   • Fund switches are offered during this settlement period.

Exclusions Under SBI Life Smart Wealth Builder Plan

The benefit paid in case of suicide within 12 months of policy inception is the fund value at the time of policy claim. All the charges (except Fund Management Charges) deducted till date of suicidal death intimation to the company are deposited back in the fund value.

Who Should Invest in the SBI Life Smart Wealth Builder Plan?

• Long-term financial planners: Individuals planning to invest their money for more than 10 years and are patient enough with their investments can consider this plan, as returns are guaranteed only after 10 years of investment. 
• Tax-conscious investors: Provides deductions under Section 80C and tax-exempt proceeds at maturity under Section 10D.
• Individuals planning retirement: Individuals with a long window between investment and withdrawing their corpus can choose this plan. This plan is an apt source for long-term wealth creation and thus retirement.
• Individuals planning their children's financial future: It allowed entry at the low age of 2 to 7 years, allowing parents to enrol their children in the plan.