December to February are always a busy month for all the insurers. During this period lots of new insurance products are launched.
As per information on their Website, This is the first ULIP which guarantee 2.5% loyalty addition of annual premium after 3th policy year. This feature is in addition to what a normal ULIP policy provides.
Guaranteed Loyalty addition:
GLA is 2.5% of annual premium you pay.
For eg. On an annual premium of Rs. 10,000; units worth Rs. 250 is credited to ones account each year from 4th year.
Having a GLA is a good sign to enter into ULIP?
My answer is No, you must check what are other charges including allocation charge that they are charging.
It might be possible that because of GLA, other charges are high.
Let us review other terms and condition of Reliance Super Invest Assure Plan (RSIP) - Plus.
Following table shows AC for 1st year which will be deducted as % of Annual premium depending on the amount you are paying.
20,000 – 50,000
50,001 – 1,00,00
1,00,001 – 3,00,000
For higher premium AC is as low as 11% and for those who want to pay high premium in first year this policy is a smart bet as GLA is available from 4th year.
For second year AC is 15%, 3rd year it is 13% and 3% thereafter.
Why this plan is attractive for those who want to pay high premium only in the initial year is it allow to reduce your yearly premium to as low as Rs, 20,000 from 2nd year onward.
This allows one to save AC substantially.
On reducing the AP Sum assured will automatically gets reduced.
AP can be reduced any time after 1st year and it can also be increased there after but it should not be greater then what you have paid in the first year.
So high level of flexibility in term of premium amount.
Partial withdrawal/surrender after 3rd year.
In case of minor it is allowed only after they complete 18 years.
However this policy charges 5% of unit value withdrawn/surrender in 4th year and 3% in 5th year.
Rest of the features is similar to normal ULIP plan.
Min Sum Assured:
Min SA under this plan depends on the age and is between 30 times to 5 times the annual premium.
Depending on the age it would be higher of fund value or Sum Assured.
For age below 6 year it pays only fund value.
Maturity Benefit is total fund value.
Policy allows 4 riders like accident death and disability and critical condition, surgical benefit riders.
Total 8 funds available and depending on the risk taking capacity one can choose them.
It allows as many as 52 free switches in a year and you can switch part or al unit to fund of your choice.
Fund managt. Charge ranges from 1.25% to 1.50 pa.
Policy admin. Charge is Rs. 50 pm.
Term and Condition:
- Entry age is as low as 30 days.
- Max. Entry age is 60 years.
- Min. Maturity age is 10 and Max. is 75 years.
- Min. policy term is 10 and Max. is 30 years.
- Min. Premium is Rs. 20,000 pa.
A nice policy if you know how to take its benefit.
If you are ready to pay high premium in first year then this could be a nice alternative to other ULIP available as you save lots of money by way of low allocation charge and in addition you will get a benefit of GLA.
However negative part is it charges you in the initial year while you partially withdraw your money but in any which ways ULIPs are for long terms.
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