The Hindu Business Line : Tata AIG Invest Assure Flexi

If all investments can be compartmentalised into long-term or short-term goals, insurance products are usually suitable for people planning to build a corpus towards a specific long-term goal.

Flexible premium options under recently launched ULIPs are designed for investors who would like to adopt a shorter term. However, if you plan to build a corpus through insurance it is advisable to plan for at least a 10-year time horizon. ULIPs particularly can be expected to give you good returns only after a period of 7-8 years. Let us take a look into the recently launched Tata AIG Invest Assure Flexi (unit linked endowment plan).

Key Features

Flexible policy term: You may choose any policy term from 5-40 years depending on your needs.

Flexible premium paying term: Policyholders can choose premium-paying term of 3,5,10 and so on up to 40 years.

Sum assured: The minimum sum assured is the higher of 5 times or policy term divided by two times, the annual premium).

Seven fund options: Midcap, Aggressive Growth, Stable Growth, Income, Short-Term Income, Capital Guarantee and Large Cap.

Minimum premium payable: Rs 15,000 p.a

Death Benefit: In case of unfortunate death of the insured, while the policy is in force, his/her nominee will get higher of the initial sum assured net of all deductible partial withdrawals, if any from regular premium fund account or regular premium fund value at applicable unit price.

For the purpose of determining the death benefit under this provision, the deductible partial withdrawals mentioned above shall mean the higher of sum of all partial withdrawals paid from the relevant accounts during the 24 months immediately preceding insured’s date of death or after insured attains 60 years of age.

Maturity Benefit: On survival to the end of the policy term, you will receive the total fund value, which is equal to the value of the Regular Premium Account plus the value of the top-up Premium Account valued at applicable unit price.

In respect of premium received in capital guarantee fund, the maturity value will be higher of the value of capital guarantee fund or the total premium received towards capital guarantee fund. This guarantee will be applicable only if all due premiums have been paid.

Settlement Option: Policyholders have an option to receive the maturity amount in instalments over a period of time. This period, termed as settlement period, may be extended up to five years from the date of maturity. You will choose the timing and amount of the instalment at the time of maturity while exercising this option. The value of such periodical payments will depend on the performance of the funds selected for investment.

Comment: During the maturity of the policy, if the stock market is undergoing a correction, like the one witnessed recently, policy holders can opt for the settlement option to extend the withdrawal, to time it to better market conditions.

Riders: Accidental Death Benefit provides for an additional benefit equivalent to the sum assured, subject to underwriting rules, in case of death due to an accident before the insured reaches age of 70 years.

Accidental death and dismemberment (long scale): This coverage includes an accidental death benefit equal to the sum assured purchased. Schedule of benefit percentages of the sum assured, payable in case of accidental dismemberment or severe burns. A double indemnity is payable for certain accidental deaths. The accidental riders are only issued for ages 18 years and above.

Pay or benefit rider: This rider can be attached to your child’s policy. In the event of death or total and permanent disability of the pay or before reaching age of 60 years or the child reaches the age of 21, whichever is earlier, all future premiums of the basic policy and this rider will be waived.

Where is your money invested?

You can choose from a variety of funds. Premium, net of allocation charges is invested in one or more funds as per your required asset allocation. You have the option of choosing any or all of the seven funds at the time of allocation, based on your preferred asset allocation. Out of the seven, three were debt based and rest are a mixture of debt and equity. These funds are all managed by Tata AIG Life Insurance.

Can I manage my investments?

Switching between the funds: During the policy term, you may switch your investment or part of investment from one fund to another, based on your view of the markets. Policyholders are not allowed to switch any amount into the capital guarantee fund. However, switching out of capital guarantee fund is allowed. Total of 12 free switches are allowed in a policy year after which charges will be applicable.

Redirection: This facility helps you to allocate future premiums to a different fund or set of funds. The premium allocation cannot be changed in the capital guarantee Fund.

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