Kotak smart advantage plan

POSTED BY Nilesh Kumar ON January 24, 2013 6:05 pm COMMENTS (24)


I bought this Kotak smart advantage (opportunities fund) in 2008 and has paid 5 premiums till date and the 6th one is due next month, but I am seeing that after paying a total premium of INR 50,000 (till date) my fund value today is INR 53718 which is roughly 7.4% on absolute return.

I would like to understand from you, that will you suggest me to stay with this policy -yes or no; or suggest some better one where i can utilise this fund.



Neil (age 32)

24 replies on this article “Kotak smart advantage plan”

  1. girish says:

    Hi Investors
    I invested 1,08,000 INR in kotak smart advantage dynamic floor fund for a term of 10 yrs. my observation is : after final premium, the units are less than the initial time when i purchased policy. I am ok with performance of this fund (after 3.5 yrs) the yield is approx. 8% per year , which in my term is not bad if you compare it with bank FD rate and i expect stock market will increase in next 10 yrs, so NAV will increase, but what are insurance benefits for this policy

    1. Seems like there are charges which are getting deducted by charging in form of units !

    2. Rajeev says:

      Dear as per your mail, I would suggest you to withdraw your plan as the return is 8% in not good at all. If the inflation is 4% then the actual return is very less. Invest in MF SIPs & Lumpsum is better option for wealth creation.

  2. Ravi says:

    Kotak is the worst Insurance company. I took this policy in 2008( Policy Number 01340496). Paid a premium of 60,000/- per year for 3 years. After paying 1,80,000/-, they told me in 2011 that my fund value is some 1,10,000/- and after deducting charges they can give me some 1,00,000/- in return. I stopped paying the premium after that. I have visited their office in JMD, Gurgaon 4 times since 2013 and every time but no resolution. They are saying that the first premium would be refunded to me without any return on that in 2017 as my policy term is 10 yrs. Today after 8 yrs, the fund value is 1,48,000/-. I am really surprised how a company of such repute can cheat me like this. They are not responding to my emails since a year now. This is the worst insurance I have ever bought. I have been requesting them to give me an appointment with a senior official but in vain. Kotak life insurance is the worst company I have ever come across.

    1. Kalpesh Patel says:

      I have also same with 15 years term, Advisor told me they will keep first premium aside and give it on completing term which is 16000 rs for 12000 rs annual premium. First i thougth it is additional but this is for 12000 rs premium that we pay in first year means after 15 year they will give me 16000 rs only for 12000 rs what a bullshit and on top of that admin charges are so high that they cut the premium @12% and fund return is less than 6% or 8% that means it is negative flow. Kotak is really bullshit company. Guys only way is to do proper marking of this by us to our friends and relatives making awareness and not going for Kotak life insurance. That is the only way we left with as such company thinks they can do anything and people can not do anything.

      1. Jagoinvestor says:

        Why did you buy the policy if it was so bad?

  3. ashalanshu says:

    Dear Shantanu, good to know that. if you feel that your BEP comes @ 8Y prem. term. so be it.



  4. shantanu001 says:

    To have better idea of life insurance, i have done IRDA certification & now i am life advisor also with TATA AIA Life plus doing PGD in life insurance so that to help other from getting victim of such mis-sellings.

  5. Dear Shantanu, in case you are surrendering the policy, you ‘ll not get the 1st year prem. Please check your policy doc.



    1. shantanu001 says:

      Mr Ashal, i have calculated for breakeven by taking into consideration max possible loss.
      i am paying premium for 8 years so its 4Lakhs, out of that 1st yr is not invested so it comes down to 3.5 lakhs. so far i hv paid for 4 years premium & my fund value is 1.74 lakh from my investment of 3 yr premium of 1.5 lakhs so even defensively if i calculate at the end of 8th year, my gain will be atleast 50000 or littlebit more so my FV will be on or above 4 lakh. after 8th year dere is no surrender charges only i will loss my 1st year premium so it will be my BEP. no profit no loss condition.

  6. Dear Shantanu, please read my reply in addition to what dear Ramesh has alreadu told you. Now the losses is already there for you. What you are going to do now? Cursing yourself/your agent/Kotak Insurance co. but continue in the same plan or make an informed decision to come out by minimising your loss at this point. surrender. Invest the surrender amount as well as future prem. elsewhere in simple product & for your insurance needs, purchase again a simple product, Term plan & be hapy after that

    Now do tell us – What ‘ll be your choice – cursing & be unhappy or acting & be happy?



    1. shantanu001 says:

      I have given thought on this & studied the policy document well, even though it late for me.. i have decided to continue till 8th policy years. from 9th policy year, dere are no surrender charges only i will loos my 1st year premium (i.e 50000), so i have switched my funds to Bond fund few months back & my plan is to get out of this worst policy at breakeven, so i only want to get growth of 50000.. i hv paid so far for 4 years & 4 years of payment is remaining for me. 1st year premium is kept asside as per plan so net invested in only 3 years premium (i.e 150000) and my fund value as of now is 174000 so i am on track, in next 4 years even if i get 26000 as a growth is also ok with me, but i m sure i will get something more than that.. thanks for advices. its a good lesson for me.

  7. shantanu001 says:

    Hi everyone,

    even I have been cheated by an Agent from Kotak Mahindra for some commission. We bought a Kotak Smart Advantage Plan. Following are the details: Kotak smart advantage plan uin-107l043V01

    I was assured for a return of 135% by the agent on completion of three years. I was quite convinced and invested 50000 per year.

    As per him, i was suppose to pay only for 3 years but after completion of 3 years, when i checked with Kotak customercare team, they told me to pay for 15 years term else you will loose your money, you will have to pay surrender charges plus you will only receive (SUM of premium paid/15) from 1st year premium.

    I have Paid premium for 4 years.
    Out of which my fund value now is 163000 & 1st year premium of 50000 is kept separate.

    IF i surrender now then i will have to pay 4% of my fund value = 6520
    From 1st year premium, i will loose 36666
    So my total charges are going to be 41186 approx.

    So i will receive only 170000 & i have paid 200000 so net loss of 30000 for me if i surrender.

    I did receive documents from Kotak Mahindra after purchasing the Policy, however the contents of the documents were highly complicated for a normal person to understand and we had to go by what the agent told us. It clearly is a marketing gimmick by Kotak asking the agent to give wrong expectation to the potential customers.
    I lost a total of 30000 by this deal instead of a 135% return as committed by the false agent

    I need expert opinion on this what i need to do now.

    1. Ramesh says:

      1. “I was quite convinced” <-- which means you accepted those things. You first need to put the blame back on you, instead of the agent. 2. If the contents of the documents were highly complicated, that just means you did not apply your mind on it and were blinded by the greed of 135% assured returns. It just comes back to your ignorance and greed. I would also assume it was because that you had to complete 80C obligations at that time, which because of your poor forward planning, kept you out of time. Harsh right. It is. But then, it is meant to wake you up from your stupor and start acting responsibly. Further advice: 1. First understand basics of financial planning. Read books, this forum, some other forum, etc. You can also join courses from Manish/Nandish team (Disclosure: I dont get anything by recommending that, in case you may think that). Learn and understand, at least the basics of investing. 2. What are you planning to do with that "only 1,70,000" and the future 50,000 per year, which you would have earmarked for this policy? Make a written statement about that now. Unless you can plan that, it is not wise to close this policy. 3. Prepare yourself properly. And in future, do not buy anything which you do not understand (which just is a different way of saying, increase your understanding). Hope this helps you. Ramesh

  8. Kotak Support Team says:

    Dear Sir,

    We request you to write us on clientservicedesk@kotak.com ID along with policy no. for better assistance.

    Kotak Support Team

  9. Dear Nilesh, as your money was already riding the Eq. in your ULIP funds, I w’d like you to invest the surrender amount as well as future prem. into Eq. MFs.



  10. Nilesh Kumar says:

    If I withdraw, where all you think I can put the money to get a better return. If you can suggest

  11. Dear Nilesh, all of us are trying to help you. We try to understand the back ground of your prev. choice before giving any yes or no type answer for your query.

    Now it’s clear from your discussion that you are accepting your mistake but not ready to amend it dye to fear of loss. My dear friend, please do imagine what ‘ll be your potential earning, if you opt to surrender now. Invest the surrender amount as well as the future prem.? Interestingly there is catch in your surrender charge. You have not noticed but here it is.

    It’s telling that a %age of fund value ‘ll be deducted towards surrender charge & remaining ‘ll be given to you. Now what ‘ll you do if from here onwards, market corrects at the time of your final surrender in 2016-2017 & your fund value is less than your total prem. paid till date?

    Think over this catch also before deciding.



  12. Nilesh Kumar says:

    Ramesh –
    1. My plan was to go for a good ULIP at that time, so that I can get a good money along with some insurance cover that was the reason to buy this plan
    2. I want to put this money for a long term as a wealth creation, as insurance is covered by a term plan for my family
    3. If I would have the complete clarity for this, I would not have rose this question here

    Hope you will be able to help me

    1. Ramesh says:


      1. Your yearly premium is 10,000 so you are paying 2% as the premium allocation charge from years 2-5, and 1% from years 6-10 (in case you continue). The corresponding charge in MF is 0%.
      2. Your FMC in the funds is nearly equivalent to what you will have in normal MFs.
      3. The mortality charges and admin charges, and others are just plain waste. (By the way, the admin charges are 65 per month = 780 per year).

      4. In this 6th year, you will incur 8-6=2% surrender charge (total 4% if it is a limited payment plan), which comes out to be a princely sum of Rs 1,060. Even if you work the admin charge and mortality charges, you will find that you will recover those costs in max 1 or 2 years, without losing any more then onwards.

      So, it makes logical sense to surrender this plan ASAP and put that money into equivalent or better MFs.

      Regarding financial wealth creation, you need to go through various threads in this forum and then once you have a decent idea, you need to consolidate.
      View 1 (My view, so view number 1)- Get a Single Direct plain vanilla equity fund for long term wealth creation. Choose Direct option (emphasis). See my recommendations from this post. http://localhost/jagoforum2/early-retirement-how-to-invest-for-later-year/6430/#comment-21441

      View 2. Use 3-4 different types of funds with varying percentages, check performances periodically, and invest accordingly. Using Direct option in this is very tedious, but possible.

      View 3. Take help of a distributor / financial planner, do not go for any Ulip, and invest accordingly. You can always recheck their recommendations here. Both Manish and Ashal can help you in doing that. Even then, it will be wise to learn everything yourself and be capable of DIY.

  13. Dear Nilesh, w’d you like to amputate a finger today or an arm tomorrow?

    The answer by you for the above question ‘ll decide the fate of your policy.



  14. Ramesh says:

    So, you found out that this policy has given you low returns.

    Q1. What exactly would you have done if you had not bought (or made to buy) this policy 5 years ago?
    Q2. What exactly will you do with the surrendered money from now on?
    Q3. Where will you put your future investment money and in what manner?

    Answer these and then a proper suggestion can be given to you.

  15. Dear Nilesh, please read your policy bond for surrender. This policy invites huge surrender charges. Please check there & come here again. This policy is one of the worst thing.



    1. Nilesh Kumar says:

      Dear Ashal,
      Yes the surrender charges are huge and that is why I was hesitant to surrender it, but i feel i will loose even if i continue, kindly suggest if i should continue till 8th year and then withdraw it.

      Surrender clause of Kotak Smart Advantage:

      The surrender charge is a percentage of the fund value. The amount payable is the fund value less the surrender charge. Incase of discontinuance of premium within the first policy year itself,surrender value equal to 10% of the premiums received will be payable. Thereafter, a surrender charge equal to (8 – N) as percentage of the fund value will apply, where N is the year of surrender. For Limited Premium Payment options, an additional surrender charge of 2% of the fund value will apply.

      No surrender charge will apply from the 8th policy year onwards. The Fixed Advantage benefit ceases in case of policy surrender any time during the premium payment term.

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