Investment Plans 422 views October 18, 2021

Kotak Ace Investment is a unit-linked life insurance plan (ULIP) that provides you life cover and wide investment strategies and fund options. The key features of this Kotak Life Insurance are as follows –

  • Multiple investment strategies
  • Convenient premium payment options
  • Rider cover
  • Partial withdrawal

Read this page and know more about these and other features of the Kotak Ace Investment Plan.

Investment

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Kotak Ace Investment Plan Base Cover

The insurance company shall provide you and your nominee the following benefits during the policy term.

Maturity Benefit

On the maturity date, the company shall pay you the fund value including top-up fund value (if any). You can use the settlement option and receive the maturity proceeds in installments. To avail of this service, you need to notify the insurer three months before the date of maturity. There are three settlement options: –

  • Receive the entire maturity proceeds in a lump sum
  • Get a part of the maturity proceeds in a lump sum and a part in installments
  • Get the whole maturity amount in installments

At the end of the settlement period, the balance amount in the main and top-up account, if any, shall be paid to you in a lump sum and, thereafter, the policy terminates. You can receive the installments for up to five years. If you select the settlement option, the number of units shall liquidate as per the respective fund net asset values (NAVs) on the date of each payment.

Important Notes

You should know the following before choosing the settlement option –

  • Partial withdrawals and switches are not allowed during the settlement period. During this period, the investment risk in the portfolio is borne by you.
  • If you request for a pre-closure or the fund value is insufficient for the payment of another installment, the balance amount shall be payable and the policy terminates.
  • Life cover and other benefits are not provided to you during the settlement period
  • In case of death, the insurer shall pay the fund value in a lump sum to the nominee
  • No other charges except the fund management charge and the applicable taxes are levied during the settlement period.

Death Benefit

The insurance company shall pay your nominee a death benefit in case of your demise during the policy term. And the death benefit is the highest of the following –

  • Basic Sum Assured – Partial Withdrawal from the Main Account + Top-up Sum Assured (if any)
  • Fund value in the main account + fund value of the top-up account (if any)
  • 105% of the paid premiums + 105% of the top-up paid premiums (if any) as on the date of death

Kotak Ace Investment Rider Options

You can customize the Kotak Ace Investment Plan by adding any of the following riders –

Kotak Accidental Death Benefit Rider – In case of your death due to an accident, the company shall pay the rider sum assured to the nominee in addition to the above-mentioned death benefit.

Kotak Permanent Disability Benefit Rider – If you suffer from total and permanent disability due to an accident, the company shall pay you the rider sum assured and the base policy continues.

Kotak Ace Investment Policy Term & Premium Payment Options

The company provides you with the following policy and premium payment term options under the Kotak Ace Investment.

Policy Term (In Years)Premium Payment TermMinimum Annual Premium (In INR)Premium Payment Mode
10
15
20
25
30
Regular Pay
Limited Pay of 5 years for a 10-year policy term
Limited Pay of 10 years for 15, 20, 25 and 30 years policy term
The minimum premium amount for Regular Pay.
Yearly - 30,000,
Half-Yearly - 18,000
Quarterly - 9,000
Monthly - 3,000
The minimum premium amount for Limited Pay.
Yearly - 50,000,
Half-Yearly - 30,000
Quarterly - 15,000
Monthly - 5,000
Yearly
Half-yearly,
Quarterly
Monthly

Note – Systematic Switching Strategy (SSS) is not available if you opt for quarterly and monthly modes of premium payment. You can learn about this strategy later.

Kotak Ace Investment Fund Options & Investment Strategies

You can invest your premium in any of the following funds of your choice based upon your risk appetite.

  • Classic Opportunities Fund
  • Frontline Equity Fund
  • Balanced Fund
  • Dynamic Floating Rate Fund
  • Dynamic Bond Fund
  • Dynamic Gilt Fund
  • Money Market Fund

You can invest in the above funds using any of the following portfolio strategies –

Self-managed Strategy – This strategy allows you to choose from any of the above seven funds as per your earnings potential. Here, you can manage your investment at your own risk.

Age-based Strategy – Under this investment strategy, the premium shall be allocated based on your age and risk appetite. You can choose your risk appetite from the following options – Aggressive, Moderate and Conservative. The allocation is mainly done between Classic Opportunities Fund and Dynamic Bond Fund. However,  you can’t opt for this strategy in the last policy year.

Systematic Switching Strategy (SSS) – It helps you participate in the volatile equity markets systematically and allows you to invest in a Money Market Fund. The company shall transfer a predefined amount every month into either Classic Opportunities Fund or Frontline Equity Fund as chosen by you by redeeming units from Money Market Fund at the applicable unit value. The transfer shall get executed automatically at the beginning of the policy month or even at the policy inception.

Systematic Exit Strategy (SES) – This helps you secure the funds from short-term market volatility during the last policy year as the units switch out of the Classic Opportunities Fund or Frontline Equity Fund to the Money Market Fund.

Partial Withdrawal Facility

The insurance company shall allow partial withdrawals after the completion of five policy years, provided all premiums are paid. The minimum withdrawal limit is INR 10,000. After the withdrawal, the balance of one annual premium should be maintained in the main account. If the fund value is less than one annual premium post partial withdrawal because of a charge or due to a fall in the NAV, the policy will continue till the fund remains positive.

The partial withdrawal facility from the main account is available if there is insufficient balance in the top-up accounts or if it is under the lock-in period of 5 years. You can do partial withdrawal if you are a major. The partial withdrawal shall affect your basic sum assured in the following manner –

For Age Up to 60 Years – Basic Sum Assured payable on death shall reduce to the extent of partial withdrawals made 2 years before the date of death.

After the Age of 60 Years – Basic Sum Assured payable on death shall reduce to the extent of all partial withdrawals made from the age of 58 years onwards. However, the minimum death benefit will be 105% of the total paid premium.

Note – If the partial withdrawal leads to termination of the policy, it shall not be allowed.

Eligibility Criteria for Kotak Ace Investment

You can purchase this Kotak ULIP if you meet the following age criteria –

  • Minimum Entry Age – 0 years
  • Maximum Entry Age – 65 years
  • Minimum Maturity Age – 18 years
  • Maximum Maturity Age – 75 years

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