Financial planning is essential in life especially if you have surplus amount sitting idle in your savings accounts. Kotak Single Invest Advantage Plan is one such insurance plan that can help you plan well in advance. It is a single premium and unit linked plan and thus, best for those who are looking to increase their existing wealth and read the benefits through the policy term.
What the Plan Has to Offer?
Kotak Single Invest Advantage has the following features
- The plan allows the policyholders to enjoy long-term benefit without commitments due to single premium policy.
- There are three different options in which the policyholders can make investments and five fund options to invest in. This gives them the liberty to choose their risk appetite at which they will invest their savings. These are basically, Self-managed, age based and Systematic switching strategy.
- The fund allows partial withdrawal that ensures liquidity.
- The loyalty additions are offered to the policyholders if they keep their money invested for longer durations.
Benefits of the Plan
Maturity Benefit
The maturity benefit is paid out to the policyholder if he survives the entire policy term. The maturity benefit can involve the fund value, top-up fund value and loyalty additions. It can be taken either in lump sum or settlement options.
Death Benefit
If the policyholder passes away during the term plan the nominee will be given the highest of following: – .
Basic Sum Assured minus partial withdrawals
Fund value including loyalty additions in the main account
105% of the premiums paid to the time of death
Terms and Conditions in the plan
- The plan involves liquidity in terms of partial withdrawals that are possible only once the initial 5 years of the policy get completed.
- The loyalty additions are offered to the insured from the end of 10th and 15th years of policy completion.
- There are tax benefits on the claims and premiums as per the section 10D and 80 C of the Income Tax act respectively.
- The plan does not include a grace period as it is a single premium plan
- The policy will be terminated once the maturity or death benefit is settled.
- The policyholders are provided with a free look period of 15 days at the beginning of the policy in order to understand policy terms and conditions and cancel the policy easily if required. If the policyholder cancels the policy within the free look period, the entire amount of allocated and unallocated premiums will be paid back to the insured after the deductions of stamp duty, medical tests, and fee for risk bearing and premium allocation.
- The policyholder has the freedom of switching among the funds at any given time during the policy term.
- The settlement of maturity benefit will also be carried out as per the choice of the policyholder. The amount can be settled as a lump sum payment, via pre-decided installment or partial lump sum and partly installment.
Options of Investment Funds
The plan offers options of 5 investment funds under the self-managed strategy. These funds are differentiated based on the risks involved and the potential for wealth creation. The policyholder can make a choice based on his or her preferences and risk appetite. The investment funds options that are offered under the plan are:
| S. No. | Fund Name | Description | Equities | Debt | Money Market Instruments |
| 1. | Classic Opportunities Fund | In classic opportunities funds, long-term growth of investment is a target by investing mainly in equities. The fund focuses on the generation of maximum returns on the investments. The investment portfolio under this plan consists of the large scale and medium scale companies to keep the portfolio of investments diversified. The risk profile of this fund is aggressive, but the return on investment is high. | 75-100% | 0-25% | 0-25% |
| 2. | Frontline Equity Fund | The frontline equity fund concentrates on investing more into equities. High proportions of investments are made in the large-scale companies. The risk and returns ratio in the fund are aggressive. | 60-100% | 0-40% | 0-40% |
| 3. | Dynamic Bond Fund | The focus of dynamic bond funds is on the fixed market instruments that have high returns like corporate bonds that generates higher funds. The fund has conservative risks and returns ratio. | 0% | 60-100% | 0-40% |
| 4. | Dynamic Gilt Fund | The risks in the dynamic gilt fund are less if compared with other fund options as the investments are made into the governemtn securities. The default risk in this type of fund is close to zero and therefore the risk and returns ratio is conservative. | 0% | 80-100% | 0-20% |
| 5. | Money Market Fund | There are no downside risks in the money market funds, and the investments of the policyholders are completely secure. | 0% | 0% | 100% |
Investment Strategies of the Plan
The plan offers multiple investment strategies, and the insured can select any strategy among these as per his or her convenience and preferences. The strategies offered in this plan are:
- Self-Managed Strategy: In the self-managed strategy the policyholder himself chooses among the available investment funds. The decision can be made by the policyholder in favor of any of the above-mentioned investment funds as per his/her risk appetite. Under this, the policy holder is allowed to switch between the above funds as per as their choice.
- Age-Based Strategy: In the age-based strategy the investments are made by Kotak Life on behalf of the policyholder depending on his/her age. The risk appetite of a person highly depends upon his or her age. The individuals on the younger side of age have higher risk appetite as compared to the older individuals. The individuals of older age are more inclined towards stable investments. The investments of younger individuals are allocated more into equities and regarding the investments of money of older individuals’ preference is given to the debt instruments. The two funds among which the investments are shuffled are classic opportunities fund and a dynamic bond fund.
- Systematic Switching Strategy: The Systematic Switching strategy includes the shifting of investments made by the policyholder from money market instruments to equities. Initially, the complete or maximum amount is invested in the money market instruments. With every passing month, a fixed amount of money is shifted into equities in a systematic manner. The money of policyholder shuffles among the frontline equities funds and classic opportunities fund under this strategy.
Eligibility Criteria
The eligibility criteria for Kotak Single Invest Advantage Plan are:
| Parameters | Min | Max |
| Entry Age | 3 Yrs | 45 |
| Maturity | 18 Yrs | 58 Yrs |
| Policy Term | 10 | 15 |
| Single Premium Payment | INR 30,000 | No Limit |
FAQs
- How many options are provided for the type of funds in the Plan?
There are five options of funds provided to the policyholders in Kotak Single Invest Advantage Plan that are differentiated on the basis of their risk profile and fund allocations. These funds are:
- Classic Opportunities Fund
- Frontline Equity Fund
- Dynamic Bond Fund
- Dynamic Gilt Fund
- Money Market Fund
- What is the limit of maximum premium in the plan?
There is no limit for maximum premium in the plan.
- What does the maturity benefit consist of?
The Maturity benefit consists of total fund value and loyalty additions along with the value of top-up fund value.