Aditya Birla Sun Life Insurance Income Assured Plan – Review, Features and Benefits

We purposely cancel our leisure time, vacation etc… so as to work hard in life to give our near and dear ones a financially secure future. But, uncertainties can always put us on the back foot. To fulfill the rising needs of life at various stages what we need is a product that guarantees returns, no matter what the situation arises.

So, when we get closer to realizing our dreams /aspirations, an extra stream of income will always be there to help realize our dreams. “Aditya Birla Sun Life Insurance Income Assured Plan”, helps us plan our future better by creating a corpus in the long run that helps us realize our dreams and various financial goals.

At inception, the insured needs to choose the Sum Assured and their premium will depend on the amount of the Sum Assured they select. For easy reference, their Sum Assured is banded as follows –

Sum Assured Band –

• Band 1 – Rs 1,00,000 to 1,99,999
• Band 2 – Rs 2,00,000 to 3,99,999
• Band 3 – Rs 4,00,000 +

Features of this Policy –

• Assured Income – 8% of the Sum Assured per annum payable monthly in arrear starting after the premium paying term till the maturity date.
• Safety for your loved ones – Comprehensive financial protection of your family with life cover.
• Tax Benefit on premium paid as per Section 80 C and 10 (10D) of the Income Tax Act, 1961

Benefits of this Policy –

a) Assured Income Benefit –

In the event the life insured survives to the end of premium paying term, the company shall pay the insured Assured Income every month till the end of the policy term at the rate of 8.0% of Sum Assured per annum. They can opt at inception to receive the Assured Income in either of the following ways –

Option A – Receive Assured Income on monthly basis till the end of the policy term; or

Option B – Accrue the Assured Income to receive it as a lump sum at the end of the policy term or on earlier death. The accrued Assured Income till date, payable on death or maturity will be increased to following percentage:-

b) Death Benefit –

In the unfortunate event of death of the life insured during the policy term, the death benefit payable to the nominee shall be as follows –

• Sum Assured on death; plus
• Guaranteed Additions accrued to date of death;

In addition the company will also pay the increased accrued Assured Income if opted for.

Sum Assured on Death is highest of the following –

1. Sum Assured as absolute amount to be paid on death; or
2. 10 times of the Annualized premium ;or
3. 105% of Total Premiums Paid up to date of death ; or

Annualized Premium shall be the premium amount payable in a year chosen by the policyholder, excluding the taxes, rider premiums, underwriting extra premiums and loadings for modal premiums, if any.

Total Premiums paid means total of all the premiums received, excluding any extra premium, any rider premium and taxes.

If the life insured is different from the policyholder, the company shall pay the above death benefit to the policyholder. The policy shall be terminated once the death benefit is paid.

c) Rider Benefit –

For added protection, the life insured can enhance their insurance coverage during the policy term by adding following riders for a nominal extra cost.

• ABSLI Accidental Death and Disability Rider
• ABSLI Critical Illness Rider
• ABSLI Surgical Care Rider
• ABSLI Hospital Care Rider
• ABSLI Waiver of Premium
• ABSLI Accidental Death Benefit Rider Plus

The insured can only opt for either ABSLI Accidental Death and Disability Rider or ABSLI Accidental Death Benefit Rider Plus

d) Reduced Paid Up Benefit –

If the insured discontinues paying premiums after having paid premiums for at least two full years, their policy will not lapse but will continue on a Reduced Paid-Up basis. Under Reduced Paid-Up, your Sum Assured and Sum Assured on death shall be reduced in proportion to the premiums actually paid to the total premiums payable during the policy term and shall be payable on death or maturity.

e) Maturity Benefit –

On the policy maturity date the company shall pay the insured the following –

• Sum Assured; plus
• Guaranteed Additions accrued to date plus
• Accrued Assured Income till date, if opted so, increased to 137.5%(for the policy term of 15, 17 and 20 years) and to 175%(for the policy term of 22 and 25 years).

f) Guaranteed Additions –

Guaranteed Additions will accrue to your policy at the beginning of each quarter after the completion of premium payment term, until policy maturity date and will be paid at maturity. The quarterly guaranteed addition rate will be 1/4thof the per annum rate.The Guaranteed Additions per annum as a percentage of Sum Assured for the various premium paying terms are given below –

Eligibility Criteria of the Policy –

Can I surrender my policy?

At any time while your policy is in effect and after all due Installment Premiums for at least two Policy Years have been paid you can request to surrender this policy for its Surrender Benefit.

The Guaranteed Surrender Value is the percentage of Total Premiums Paid and the surrender value of accrued guaranteed additions less Assured Income Benefits paid to date. If the insured opts to accrue the Assured Income then the Guaranteed Surrender Value is the percentage of Total Premiums Paid and the surrender value of accrued guaranteed additions.

Your policy also acquires a Special Surrender Value. The Special Surrender Value will include the discounted value of any Accrued Assured Income till date of surrender, increased to 137.5%(for the policy term of 15, 17 and 20 years) and to 175%(for the policy term of 22 and 25 years). Your surrender benefit is the higher of the following –

• Guaranteed Surrender Value, or
• Special Surrender Value.

Is there any grace period in the policy?

If the insured is unable to pay the Installment Premium by the due date, then the insured will be given a grace period of 30 days during which time all benefits under the policy will continue. If the company do not receive policy premium within the grace period, the policy benefit may lapse fully or be deemed paid-up as per Premium Discontinuance and Policy Paid-Up provisions.

Can I return my policy if I didn’t like its terms and conditions?

Yes, the policy can be returned to the company within 15 days (30 days in case the policy issued under Distance Marketing) from the date of receipt of the policy.This period is known as the Free Look Period.

The company will refund the premium paid once they receive a written notice of cancellation (along with reasons thereof) together withthe original policy documents. The company will further deduct proportionate risk premium for the period of cover and expenses incurred by us on medical examination and stamp duty charges.

What is permium discontinuance in the policy?

If the insured is unable to pay the Installment Premium by the due date, they will be given a grace period of 30 days during that time all benefits under the policy will continue.

(a) Until 2 full years Installment Premium are paid –

If the company do not receive the entire Installment Premium by the end of the grace period, this policy will be deemed lapsed and all benefits will cease immediately. The lapse date is the date the first unpaid Installment Premium was due. The insured will be given a period of five years from the lapse date to revive your policy.

(b) Once 2 full years Installment Premium have been paid –

If the company do not receive the entire Installment Premium by the end of the grace period, this policy will be deemed paid-up and benefits will continue as per the Policy Paid-Up provision. The paid-up date is the date the first unpaid Installment Premium was due. The insured will be given a period of five years from the paid-up date to revive the policy for its full benefits.

Can I take any loan against this policy?

The life insured is eligible to take a loan against their policy at any time after their policy acquires a surrender value. The minimum policy loan is Rs. 5,000 and the maximum is 85% of the then Surrender Benefit less any outstanding policy loan balance as of date.

If the insured have any outstanding policy loan balance on any date shall equal all policy loans made to date, including accrued and unpaid interest thereon, less any policy loan repayments you have made to date. When their outstanding policy loan balance equals or exceeds the Surrender Benefit then on that date, all benefits under your policy will cease immediately and policy will terminate.

Is there any revival period in the policy?

To revive the policy, the insured must pay all unpaid Installment Premiums due till date plus interest thereon. The company will charge the interest for policy Revival at a rate declared by us determined as (x+1%)/12 rounded to the nearest 0.5%, where x is the base rate of the State Bank of India.

The Revival will be effected on receipt of the evidence of insurability satisfactory to us with respect to the Life Insured. The company may call for additional information/documents to process the Revival request. The company also reserves the right not to revive the policy on original terms based on the underwriting decision. The effective date of Revival is when these requirements are met and approved by the company.

When can my policy terminate?

Your policy will terminate at the earliest of the following –

• The date of settlement of the Death Benefit; or
• The date of payment of the surrender value, if any; or
• The policy maturity date; or
• The date on which the Revival period ends after your policy has lapsed if fewer than two full year Installment Premiums have been paid; or
• The date when outstanding loan value exceeds the surrender value.

Exclusion under this policy –

Suicide Exclusion –

In case of death of Life Insured due to suicide within 12 months from the date of commencement of risk under the policy or from the date of Revival of the policy, as applicable, the amount described in the Death Benefit provision will not be payable.

In such circumstances, the company shall refund the premiums paid since date of inception of policy till the date of death (excluding applicable taxes) or they shall pay the Surrender Value available as on the date of death, whichever is higher to the Nominee or beneficiary of the policyholder, provided the policy is in force or active.

Conclusion –

So, by now you know each and every important detail about this policy. Do let me know if I have missed any important points in the comment section. Please feel free to ask any doubts regarding this policy.