Reliance Child Insurance is a customary participating kid plan that safeguards children’s futures even when their parents are not present. The Reliance Child Plan is a Traditional Money Back Child Plan that has paid out 25% of the Sum Assured each year for the previous four years. The parent’s life is insured under this plan for the benefit of children. In addition to the Bonus at Maturity, 25% of the Sum Assured is paid in the last 4 years of the policy and the premium must be paid for the full term. However, the entire Sum Assured is paid as an immediate benefit if the parent passes away or becomes totally and chronically handicapped during the policy term. To guarantee that the Maturity Benefit is paid in any case, the future premiums for this child plan are waived.
Reliance Child Plan’s Main Characteristics
This Traditional Money Back Plan has paid out 25% of the Sum Assured each year for the previous four years. Even in the terrible event of a parent’s passing, the Maturity Benefit is paid in all cases. The high amount is paid rebate offered by this policy On maturity, the accumulated bonus is due. This policy offers three riders: the Critical Illness Rider, the Accidental Death & Total & Permanent Disability Rider, and the Family Income Benefit Rider.
The Advantages of the Reliance Child Plan
Maturity Benefit: At maturity, the final 25% of the sum is assured plus a bonus.Maturity Advantage Guaranteed Sum Assured will be paid at maturity in an amount equal to 25% of the Base Sum Assured plus any applicable High Sum Assured Addition benefit, vested bonuses, and any applicable Non-Negative Capital Guarantee addition
Bonuses: The policy shares in the company’s profits through straightforward reversionary bonuses, which are typically announced by the company at the conclusion of each fiscal year. If the policy is still in effect, the reversionary bonus amount is added to your insurance payout as a percentage of the Sum Assured. Once declared and credited to your policy, the reversionary bonus for a given year becomes a Guaranteed Benefit.
If the overall benefit amount including the periodic lump sum payment, the guaranteed payout at maturity, any vested bonuses, and any death claims is less than the total premiums paid by 100.1 percent, the difference will be made up.
The total premiums paid in a calendar year with respect to the Base Sum Assured selected by the policyholder, minus any applicable underwriting additional premiums and frequency loadings.
Revival: A policy that is Paid-Up or has expired may be revived within two years of the first unpaid premium’s due date but before the policy’s maturity date by paying the premium arrears plus interest. The insurance must pass good medical and financial assessments in order to be reinstated. The revival is subject to the Company’s Board-approved underwriting policy, which may require the Life Assured to submit to medical testing, among other requirements.
The Company maintains the right to periodically adjust the relevant interest rate in light of the economic climate, past performance, and other circumstances. A lapsed insurance will be terminated if it is not renewed within the allotted time.
Surrender: The year of surrender and the selected insurance term will affect the surrender value. Guaranteed Surrender Value (GSV) and Special Surrender Value together make up the Surrender Value payable (SSV).
The applicable Surrender Value will be paid in the event of a death before the end of the three policy years. i. A policy with guaranteed surrender value (GSV) will only have GSV if the first three annualized premiums have been paid.
The GSV shall gain value in proportion to the total premiums paid, excluding rider premiums and extra premiums, less any previously paid survival benefits (GSV factor for premiums paid). Existing bonuses’ surrender value is determined by multiplying their vested value at the moment of surrender by the bonus’s GSV factor.
Guarantee Against Negative Capital: The plan provides a guarantee of premium return. If the overall benefit amount including the periodic lump sum payment, the guaranteed payout at maturity, any vested bonuses, and any death claim is less than the total premiums paid by 100.1 percent, the difference will be made up.
The total premiums paid in a calendar year with respect to the Base Sum Assured selected by the policyholder, minus any applicable underwriting additional premiums and frequency loadings. Section 80C of the Income Tax Act permits the deduction of up to ₹ 1,000,000 in annual life insurance premiums from taxable income.
Value of Special Surrender (SSV): If the first three years’ worth of premiums have been paid in full, the Special Surrender Value (SSV) will be gained. An actuarial perspective value of the future benefits is what the SSV factor represents. In accordance with the economic climate, experience, and other circumstances, the Company has the right to alter the Special Surrender Value (SSV) calculation method and the basis at any moment, subject to IRDA permission. The policy document contains information on the GSV and SSV factors in depth.
Note: The policy cannot be reactivated if it is relinquished. Once it is turned in, the policy will expire.
Additional Reliance Child Plan Features and Benefits
- Three more riders are included in this policy.
- Important Illness Rider
- Rider for Accidental Death & Total & Permanent Disability
- Rider for Family Income Benefits
- And this plan has 1 built-in rider available.
- With the Premium Waiver Benefit Rider, the insurer will pay the premium up to a maximum of ₹ 40,000 annually.
Rules and Regulations (T&C)
Modification of the Sum Assured or Policy Term. After the policy’s start, the Sum Assured and policy term cannot be changed.
- Loan: After the first three years, loans up to 80% of the fund value are available. If the total of the loan balance and unpaid income on the loan balance surpasses 95% of the cash value at any point during the life of a Paid-Up policy, the policy will be discontinued by deducting the loan balance and unpaid interest balance from the payout.
The current annual percentage rate for the loan is 10.50 percent. For a policy where a loan was taken out, the outstanding loan principal and interest will be recovered first, and any remaining balance will be paid to the policyholder. This is true before any benefit (death, lump sum payment, maturity, or surrender) is paid to the policyholder.
Subject to IRDA clearance, the Company has the right to periodically change the relevant interest rate in response to changes in the economic climate, experience, and other considerations.
- Tax advantage: Subject to the relevant tax rules and regulations, premiums paid for the Reliance Child Plan are tax-deductible. Income tax benefits under the Income tax regulations may occasionally be amended.
- Service Tax: According to the current rates announced by the government, service tax and the education cess would be assessed. Additional to and in addition to the basic premiums, the Service Tax on the base premiums will be paid.
- Future taxes imposed by the government: In the future, the company may opt to pass on to the policyholder any additional taxes imposed by the government or any regulatory authority. The Company will advise the policyholder of the manner of tax collection whenever it decides to pass on additional taxes to them.
- Exclusion of suicide: The nominee or beneficiary of the policyholder will be entitled to at least 80% of the premiums paid, providing the policy is in place, if the insured member commits themselves within 12 months, regardless of whether they are sane or insane.
The nominee or recipient of the policyholder is entitled, as of the date of revival of the policy, to the greater of 80 percent of the premiums paid up to the date of death or the capitulation value in effect on the date of death. In the event of suicide, the Company will not provide any insurance benefits.
- Monthly Premium: Only on the anniversary of the policy can the mode of premium payment under the Regular Premium payment option be altered. The Annualised Premium, excluding any applicable extra premiums and loading for premiums, is the amount that is due each year in relation to the Base Sum Assured that you select under the Base Plan.
The required additional premiums will be charged to substandard lives with medical issues or other impairments in compliance with the underwriting standards.
- Free-Look window: If you don’t agree with any of the terms and conditions of this policy, you can revoke it by sending the Policy Document back to the company within 15 days (applicable for all channels of distribution; the exception is the Distance Marketing* channel, which will have 30 days) of receiving it, as long as you let them know why you disagree.
After deducting the proportionate risk premium for the time the company has supplied you with life insurance up until the date of cancellation and for the costs the company expended for the medical examination and stamp duty fees, the company will return the premiums you paid. Distance marketing encompasses all lead generation and solicitation activities for the sale of insurance products via the following channels - Short Messaging Services (SMS)
- Electronic Modality – interactive television
- Internet, and e-mail – (DTH)
- Physical Mode – newspaper and magazine inserts, direct postal mail
- Solicitation – By any form of contact other than face-to-face
- Voice mode – which enables calling on a phone
- Assignment and Nomination: This plan will permit nomination as that term is defined in Section 39 of the Insurance Act of 1938.Under this Plan, Assignment, as that term is defined in Section38 of the Insurance Act of 1938, shall be permitted.