Kotak Life Insurance has launched an immediate annuity product Kotak e-Lifetime Income Plan.
It offers the purchaser of annuity the option to choose an annuitant (the beneficiary) other than self. This way, the beneficiary of regular income from the plan can be any close blood relative or spouse, apart from self.
The plan is in response to increasing population longevity, which necessitates a regular source of income for a longer period, to take care of one’s needs in retirement years. The unique design of the plan also effectively addresses a huge demand among geographically mobile youth population groups such as individuals who have moved away from home in search of professional opportunities, and non-resident Indians (NRIs), to secure a regular income for family and loved ones living back home.
The plan is available for online purchase at
The one time premium paid by the proposer is paid out to the annuitant at the interval chosen – monthly, quarterly, half yearly or yearly at the pre-defined annuity rate promised at the time of purchase. Annuity rates will depend upon the age of the annuitant, the amount invested and the annuity option chosen. For instance, a son investing Rs 3 lakh for purchasing an annuity for his father aged 66 years can be assured a guaranteed annual payout at 11.12 per cent under the Lifetime Income option and at 10.58 per cent under the 10-year guaranteed payout, irrespective of death of the annuitant during the guaranteed period option. These represent a significant markup compared to other savings instruments earmarked for similar purpose.
The income rate quoted at the time of purchase is guaranteed for the lifetime of annuitant and will not change with varying market conditions.
The minimum age of entry for the proposer is 18 years while the minimum age of entry for annuitant is 45 years. The minimum one time investment can be as low as Rs 50,000. The single premium invested is also eligible for a tax rebate under section 80CCC of the Income Tax Act.
Elizabeth Venkataraman, Head, Marketing at Kotak Life Insurance, said: ‘We believe the product will especially appeal to individuals who have moved away from their homes in search of professional opportunities, including NRIs, since the foremost priority for these individuals is to secure a regular source of income for aged parents and spouses back home.”