Child Plans By SBI
SBI Life Child Insurance plans offer a host of benefits to the policyholders. A single premium can buy the protection of a policyholder’s entire family. Various riders ensure that the policyholder is covered no matter what the circumstances. Some of the benefits are detailed below:
- Child Plans ensure that the child of a policyholder gets to complete their education no matter what the circumstances.
- All policies afford a death benefit to the policyholder’s family. Thus, a policyholder can enjoy peace of mind knowing that their child’s education is financially secure even in their absence.
- SBI Life Child Plans offer added benefits or bonuses such as Smart Bonus or Additional
- Benefits over and above the Sum Assured for a greater income.
- Bonus at various stages of a child’s life to ensure that the money gets utilised for a child’s benefit and not simply squandered away.
- The return of benefits in case of Child Plans is quite large compared to the premium cost.
- Child Plans have in-built rider benefits that ensure that a child does not suffer in case of accidental death or accidental total and permanent disability of the policyholder.
- In addition to all the benefits, SBI Life Child Plans have a premium waiver program that automatically waives all future premium payments due on the policy at the unfortunate demise of the policyholder.
- Child Plans allows policyholders to claim tax benefits under section 80C of the Income Tax Act, 1961 on the premium paid for purchasing the insurance plan. Linked Child Plans also get tax benefits under section 10(10D) of the Income Tax Act on the maturity benefit.
List of Child Plans Provided By SBI Life
SBI Life - Smart Champ Insurance
This is a participating, individual life insurance product designed especially for children to ensure their future education is taken care of. The policyholder can get him/herself assured against death and/or Accidental Total Permanent Disability, and their child nominee will get the Sum Assured plus Smart Bonus on attaining ages 18, 19, 20 and 21 in case the the event insured against occurs.
Benefits and Features of SBI Life - Smart Champ Insurance Plan:
- Smart Benefits are guaranteed bonuses payable in 4 equal installments annually once the child attains 18 years till 21 years of age. The bonuses are paid at the end of each remaining 4 years of the policy. Each of the 4 installments is paid when the child completes 18, 19, 20 and 21 years of age respectively. Each Smart Benefit installment consists of 25% of the basic sum assured, plus 25% of the vested simple reversionary bonuses.
- A Terminal Bonus is also paid as part of the last bonus installment in addition to Smart Benefits, if applicable. This ensures your child’s higher educational needs are met.
- Smart Champ Insurance boasts of a triple protection plan in case of the insured event happens while the policy is in force:
Immediate Payment: The Sum Assured amount for the insured event is paid as a lump sum on its occurrence.
Waiver of Remaining Premium: All remaining premium amount due are waived in event of the unfortunate death of the policy proposer. However, the policy continues to accumulate bonuses even after said event.
- Smart Benefits: All installments due of Smart Benefits, from the time the child reaches 18 years till the age of 21 years, are paid to the nominee regardless of the circumstances. Terminal bonus is paid with the last installment of Smart Benefits, if applicable.
- 2 Premium Payment option available - Single Premium (SP Policy) or Limited premium Payment Term (LPPT Policy).
- In the last 3 years of the term, the policy provides for the option to withdraw all the future installments (discounted) of Smart Benefits as a lump sum amount. In addition to the Smart Benefits the terminal bonus (if applicable) also gets added to this amount.
The various benefits under this plan are:
- Death Benefit: This benefit is equal to the Sum Assured which can be the basic amount insured or times of the single premium or 105% of the total premiums paid till date. In case of Single Premium policy the Sum Assured is calculated as 1.25 x SP (if the policyholder is less than 45 years), or 1.10 x SP (more than 45 years in age).
- All future installments of premiums due get waived, but the policy continues to accumulate bonuses.
- Smart Benefits: The child nominated gets Smart Benefits, payable at the end of each policy year starting from when the child reaches 18 till he/she attains 21 years of age. This benefit is equal to 25 % of the Sum Assured + 25% of Vested Simple Reversionary Bonus.
SBI Life - Smart Scholar
This is a unit-linked policy that helps the policyholder fulfill their responsibility as a parent by securing their child’s education. This policy offers 7 different fund options to invest in. The policy also has built in Accidental Death and AT&PD benefit.
Benefits and Features of SBI Life - Smart Scholar Plan:
This policy ensures that the future of the nominated child is secure with insurance benefits plus other gains for the financial markets.
- The policy provides for double protection for the policyholder’s child and family by providing:
Payment of basic Sum Assured.
Premium due waivers to make sure that the policy is not discontinued. - The plan comes with inbuilt Accidental Death and Accidental Total and Permanent Disability (AT&PD) benefit. Hence, no separate purchase of riders are required to avail of these benefits.
- This plan also allows for periodic Loyalty Additions to be paid as long as the policy is in force. Loyalty Additions are made in the form of allocation of free units in the fund options. Loyalty additions depend on term of the policy. The loyalty addition at relevant policy year end will be equivalent to- 1% x [Average fund value over the 1st day of the last 24 policy months].
- Smart Scholar plan comes with the option of investing in 7 different funds.
- Policyholders can access liquidity by partially withdrawing funds when required.
- The various benefits under this plan are:
- Maturity Benefit: The Fund Value is paid on completion of the term of the policy.
- Death Benefit: The higher of the two - the Sum Assured or 105% of total premium paid is payable in event of the unfortunate demise of the policyholder.
- Premium Payor Waiver Benefit: The plan also has inbuilt Premium Payor Waiver Benefit that ensures the policy doesn’t lapse in such circumstances. The fund value accumulated at the end of policy term is paid at maturity.
- Accident Benefits: If the policyholder suffers total and permanent disability due to an accident or even dies, the accidental death and AT&PD benefits kick in.
- Tax Benefits:
Tax deduction is available under Section 80C. However, if the premium amount paid during a financial year is more than 10% of the Sum Assured, the benefit shall be limited up to the 10% of the Sum Assured only.
At the time of maturity or surrender, tax exemption is available under Section 10(10D), if the premium did not exceed 10% of the sum assured in any year during the policy term. However, proceeds from death are fully exempt.
Conclusion
SBI Child Insurance Plans ensure that a parent can fulfill their duties towards the child no matter what the situation. As these plans come with built-in Accidental Death and Accidental Permanent and Total Disability benefits without any extra cost, these plans provide peace of mind to the policyholders that their child’s education won’t be compromised in any unfortunate circumstance.
Also read: What Is The Grace Period In Child Plans
