More and more providers are announcing new ULIP products in India. SBI Life Smart Performer and SBI Life Unit Plus Super are two new plans launched by SBI life Insurance company. The SBI Life Smart Performer is completely redesigned ULIP product and comes under the latest IRDA regulations come into effect on this month. Thus the charges associated with SBI smart performer is smaller than the ULIP products like Unit Plus III sold until September 2010. Like in LIC Pension Plus, SBI Life Smart Performer invests the fund of the user in two plans and two fund options. SBI Life Smart Performer – Daily protect Fund provides guaranteed returns and 5% more of the NAV at 7th year of the policy term.
SBI Life Smart Performer ULIP features, charges, fund options, and return:
Available in regular and single premium modes, the SBI Life Smart Performer offers guaranteed returns based on the fund chosen. There are two plans, SecurePlan and Secure and Growth Plan. In Secure plan, your money after meeting charges is invested into Daily protect the fund. SBI Life Smart Performer assures NAV guarantee for investment on Daily Protect fund and also 5% more on the NAV value at the end of the policy term. Your money is secure in this fund as its used to purchase government securities and bonds with lower risks. However, the growth of the fund value in this plan would be slower than the other option, Secure and Growth. In SBI Life Smart Performer – Secure and Growth plan, the NAV after charges is invested in Daily Protect Fund and the Index fund. That is around 80% of your investment in DPF and rest in Index fund, which is a direct investment in the stock market. So the investment in SBI Life Smart Performer Secure and Growth Plan receives the benefits of NAV guarantee and market growth. The 80% of this fund in DPF will get the guaranteed NAV, and the rest will get the value based on the NIFTY market position. Another feature of SBI Life Smart Performer is the Automatic Rebalancing. It is nothing but any gain from the Index fund in Growth and Secure Plan is transferred into the Daily Protect Fund so that it remains secure from upcoming market fluctuations.
The SBI Life Smart Performer plan also provides tax benefits under the Government of India norms. The policy offers Life Insurance cover of 7-10 times the annual premium for regular and 1.25 to two times, for single premium, based on age restrictions. The minimum age of entry into SBI Life Smart Performer is nine years and maximum 75 years. The policy maturity time will be reached in 10 years, in which the first five years are the premium payment term or lock-in period. As per IRDA rules, SBI Life allows the cancellation of Smart Performer policies, even before five years with minimum surrender charges. Furthermore, there is a free look period of 15 days from the date of commencement of policy in which the customer is allowed to cancel the policy without any charges. After 5th year, until 7th year it is known as the NAV -Built-up phase. In this phase, customer is allowed to make partial withdrawals from their existing fund value. The last three years of the policy term in SBI Life Smart Performer is known as the Accumulation phase. At the end of the term the customer will be paid with the final NAV value and the guaranteed additions.
Download SBI Life Smart Performer brochure here.
Surrender charges and conditions in SBI Smart Performer:
As said earlier, customers are allowed to cancel Smart Performer policies before the end of the lock-in period. Such policies and are moved to a discontinued policy fund with minimum 3.2% interest p. a. There will not be any other charges in the policy, however, is the policy will not provide any type insurance cover. The fund value can be collected at the end of 5th year of the policy term.
SBI Life Smart Performer charges:
The premium allocation charge in SBI Life Smart Performer regular plan is 8.5% for the first year and thereafter 6% until the 5th year – for single premium its 3% of the premium. The company charges 0.5% per annum as the NAV guarantee charge for the amount in Daily Protect Fund. The fund management charge is 1% for Daily Protect Fund and 1.5% for Index fund, collected per annum.
The latest NAV value of SBI Life Smart Performer is 10.283 after 13 days of operation.