Investment Plans 7059 views March 11, 2020

SBI Life Smart Bachat

Smart Bachat Plan offered by SBI Life is an endowment assurance plan with participating benefits. This plan offers savings along with insurance benefits and also provides tax benefits to the policyholder. While the policy term can be between 10 and 25 years, there are four premium payment term options offering flexibility to the policyholder. SBI Life Smart Bachat Plan allows the policyholder to select from two offers – endowment option and endowment option along with inbuilt rider of the accidental death benefit and total permanent disability benefit. Smart Bachat Plan safeguards the family of the insured financially in the unfortunate demise of the insured and also provides with the opportunity to save for long-term future goals such as retirement, children marriage and education etc.

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Features of SBI Life Smart Bachat Plan

Smart Bachat Plan comes with many features that help the policyholder to meet their investment needs efficiently and effectively. The key features of the plan are stated below:

  1. The premium payment term of the plan is limited
  2. The plan offers two options – endowment option and endowment option with accidental death and total permanent rider benefit inbuilt with the plan
  3. The plan provides policyholders the flexibility to choose the term of the policy.
  4. The annual premium to be paid is calculated as per the option selected by the policyholder, the sum assured of the plan, the age of the policyholder, the term of the insurance policy and the premium payment term as selected by the policyholder.
  5. The plan provides a simple accrued revisionary bonus to the policyholder throughout the term of the policy
  6. The plan also provides premium waiver benefit which is inbuilt in the plan in the second option
  7. The plan provides protection cover to the insured throughout the term of the insurance plan
  8. The premiums for the plan are exempted under section 80C of the Income Tax Act
  9. Death benefit is tax-free under section 10(10D) of the Income Tax Act.

Benefits of SBI Life Smart Bachat Plan

The plan offers numerous benefits to the policyholder. It is a flexible endowment insurance policy which offers the following benefits:

  1. Death Benefit– For policyholders who have to choose endowment benefit only, on the death of the insured during the term of the policy, death benefit will be received by the nominee which includes sum assured on death along with simple reversionary bonuses and final additional bonus declared by SBI Life. The death benefit will be higher of the basic sum assured in the plan or 10 times the annualized premiums.
  2. The benefit of accidental death rider will be lower of basic sum assured and Rs 50 Lacs subject to the condition that the entire sum assured in this benefit for all individual policies is not more than INR 50 lakhs
    The death benefit to be paid under all the options will always be higher than 105% of all the premium paid for the insurance plan
  3. Maturity Benefit- On maturity of the plan, the insurance company will pay maturity benefit to the policyholder which will be the basic sum assured under the plan along with simple accrued reversionary bonus and terminal bonus as declared by SBI Life.
  4. Flexibility benefit- SBI Life Smart Bachat Plan offers policyholders the flexibility to select from two options for life coverage.
  5. Free-look Period – SBI Life allows the policyholder to cancel the plan within a period of 15 days of receiving the policy bond if the policyholder is not happy with the insurance plan. On cancellation of the plan, the premiums paid for the plan after deducting the expenses will be returned to the policyholder.
  6. The plan offers a loan facility which provides liquidity to the insured when he/she is in need of funds. The plan must acquire a surrender value for you to get a loan against the same.
  7. Grace Period – There is a 30-day grace period from the due date of the premium in case of yearly, semi-annually, and quarterly mode of premium payment. In the case of the monthly mode of premium payment, the grace period is 15 days.

Eligibility for SBI Life Smart Bachat Plan

The plan is issued only to those who satisfy the eligibility criteria of the plan as shown below-

  1. The minimum age for entry is 8 years for endowment option and 18 years for endowment with accidental death and total disability rider. The maximum entry age is 65 years.
  2. Maximum Maturity Age for the plan is 65 years.
  3. Minimum term of the plan is 10 years and the maximum term of the plan is 25 years.
  4. Minimum sum assured is INR 1,00,000 and there is no maximum limit for sum assured. However, the sum assured can only be in multiples of INR 1,000
  5. The frequency of premium payment can be yearly, half-yearly, monthly, quarterly. However, for monthly mode of payment, a premium of 3 months has to be paid in advance
  6. The frequency of premium payment for half-yearly, quarterly and monthly mode is 51%, 26% and 8.50% of the annual premium, respectively.
  7. The minimum premium to be paid yearly is INR 5100, for half-yearly is INR 2600, for quarterly is INR 1350 and for monthly is INR 450 and there is no maximum premium amount in this plan.

Conclusion

SBI Life Smart Bachat policy is a savings endowment plan which provides long-term benefits of coverage of life as well as savings by limiting your paying obligation. It offers flexible features and is a great choice in order to meet the dual needs of savings along with insurance.

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