Bajaj Allianz Lifelong Assure Plan Review
Bajaj Allianz Lifelong Assure is traditional, participating Whole Life Endowment Plan where premiums are payable only for a limited tenure. Thus, the plan provides lifelong insurance coverage without a break in the coverage continuity.
Highlights of the Bajaj Allianz Lifelong Assure Plan
This is a traditional Whole of Life Term plan which participates in cash bonuses declared by the company from the 6th policy year.
- It is a Limited Premium Paying plan where the policyholder can choose any tenure from 10, 15 or 20 years.
- The benefit payable under the plan can be availed in installments and coverage is provided till the insured reaches 100 years of age.
- After the completion of the Premium Paying Term, the plan provides guaranteed cash backs.
- Female lives are allowed premium rebates.
Working of the Bajaj Allianz Lifelong Assure Plan
- The policyholder chooses the Sum Assured and the Premium Paying Tenure. Based on the age of the insured, the Sum Assured and the Premium Paying Tenure and frequency, the premium would be calculated.
- If the insured dies any time before reaching 100 years of age, the death benefit is paid.
- Guaranteed cash back as a percentage of the Sum Assured would be paid every year after the Premium Paying Term is completed as a Survival Benefit.
- In addition to this cash back, cash bonuses are also paid every year from the 6th policy year.
- On maturity when the insured reaches 100 years of age, the maturity benefit is paid.
Benefits and Features of Bajaj Allianz Lifelong Assure Plan
- Maturity Benefit – If the insured attains 100 years and the plan matures, the Sum Assured on Maturity is paid which is a percentage of the Sum Assured based on the Premium Paying Term (PPT) chosen and any Terminal Bonus. The percentage of Sum Assured payable is as follows:
||Sum Assured on Maturity
||200% of the Sum Assured
||250% of the Sum Assured
||300% of the Sum Assured
- Death Benefit – If the insured dies before reaching 100 years of age and the policy is in-force, the death benefit payable would be higher of the following:
- 10 times the annual premium if age is lower than 45 years or 7 times the annual premium if age is 45 years and above
- 105% of total premiums paid till death
- Sum Assured on Maturity i.e. 200%, 250% or 300% of the Sum Assured according to the Premium Paying Term chosen.
Along with the death benefit, any interim cash bonus and Terminal Bonus would also be paid.
- Benefits in installments – The maturity benefit or the death benefit can be taken in monthly installments instead of a lump sum amount over a period of 5 years or 10 years. The value of the monthly installment would be calculated as below:
- For 5 years – 1.04*(maturity benefit or death benefit/60)
- For 10 years – 1.08 *(maturity benefit or death benefit/120)
These installments can also be discontinued anytime. On discontinuation, the total benefit payable net of the installment benefits already paid is paid to the policyholder or nominee as the case may be.
- Survival Benefits – Guaranteed cash backs are paid to the policyholder after the completion of the Premium Paying Term @3% of the chosen Sum Assured. Cash bonuses, depending on the company’s performance, are also paid from the 6th policy year.
- Loan –Loans are allowed under the plan only if the plan has acquired a Surrender Value. The maximum available amount of loan is 80% of the Surrender Value of the plan.
- Bonus –Cash bonuses are declared and paid from the 6th policy year.
- Tax benefit – Premiums paid under the plan would be exempt from tax under Section 80C up to a limit of Rs.1.5 lakhs. The death benefit or the maturity benefit received would also be tax exempt under Section 10(10D) of the Income Tax Act.
Eligibility Criteria of Bajaj Allianz Lifelong Assure Plan
The plan can be bought only by Resident Indians. The other eligibility criteria of the plan includes:
|Entry age (Last Birthday)
|Maturity Age (Last Birthday)
||(100 – age at entry) years
||PPT - 15
||PPT - 20
|Premium Paying Term (PPT)
||10, 15 and 20 years
|Premium payment mode
||Monthly, quarterly, half-yearly and annually
Additional Benefits of Bajaj Allianz Lifelong Assure Plan
- Riders – Five additional riders are available under the plan which can be added to the base policy for a comprehensive coverage option. The riders include:
- Bajaj Allianz Accidental Death Benefit Rider
- Bajaj Allianz Accidental Permanent Total/Partial Disability Benefit Rider
- Bajaj Allianz Critical Illness Benefit Rider
- Bajaj Allianz Family Income Benefit Rider
- Bajaj Allianz Waiver of Premium Benefit Rider
- Premium Discounts – If a higher amount of Sum Assured is chosen, the company provides premium rebates. This rebate is allowed per thousand of Sum Assured for Sum Assured levels above Rs.1 lakh. The rebate offered ranges from Rs.8 to Rs.19 per thousand and depends on the Premium Paying Term and age of the policyholder
- Grace Period – A grace period of 30 days is allowed for payment of premium after the due date for annual, half-yearly or quarterly modes of premium payment. For monthly modes, the grace period allowed is 15 days. The life cover under the policy would continue during the grace period.
- Free Look Period – A cooling off period or a free look period of 15 days is granted to the policyholder after the policy issuance to review the policy terms and conditions. If found unsatisfactory, the plan can be cancelled within this period and the premium paid would be refunded after deducting the relevant mortality charge, service tax, cess and stamp duty paid.
Let's Understand The Plan With An Example:
Ravi aged 30 years has taken a Bajaj Allianz Lifelong Assure policy for a premium paying term of 20 years. The Sum Assured chosen by him is Rs.5,00,000 for which he is paying an annual premium of Rs.51,805 after a high sum assured rebate of Rs.4000.
The benefits received by Ravi will be as follows.
*Premium shown above is exclusive of Service Tax & cess, and any extra premium and is for illustrative purpose only.
For female lives 3 year age set back is applicable in premium calculation. For substandard and smokers extra premium shall be charged as per board approved underwriting norms.Cash bonus mentioned above is not guaranteed and will be based on actual experience
The following is the sample premium for a combination of ages and Sum Assured (SA) and Premium Payment Terms (PPT).
The above premium chart is as follows:
||SA – 2 lakhs
||SA – 5 lakhs
|PPT – 10 years
||PPT - 15 years
||PPT - 20 years
||PPT – 10 years
||PPT - 15 years
||PPT - 20 years
Exclusions in Bajaj Allianz Lifelong Assure Plan
- If the policyholder commits suicide within a year of policy issuance 80% of the premiums paid would be returned and no death benefit would be payable
- If suicide is committed within a year of policy revival, higher of 80% of the premiums paid till death or the Surrender Value acquired would be paid provided the policy is in force
Non-Payment of premium in Bajaj Allianz Lifelong Assure Plan
Premiums have to be paid for at least 3 years after which the policy can either be surrendered or made paid-up.
Making the policy Paid-up
If at least 3 full years’ premium has been paid, the policy could be converted to a paid-up policy if future premiums are not paid. The Sum Assured would be reduced and the death and maturity benefits would depend on the reduced Sum Assured. The applicable death or maturity benefits for a paid-up policy would be as follows:
||Sum Assured on Maturity
||200% of the reduced Sum Assured
||250% of the reduced Sum Assured
||300% of the reduced Sum Assured
If premiums for at least 5 years have been paid, the guaranteed cash backs and the cash bonus, if any would be paid under the policy based on the reduced Sum Assured.
Surrendering the policy
Surrender is allowed only after the policy becomes paid-up. On surrendering the policy, higher of the Guaranteed Surrender Value (GSV) or the Special Surrender Value (SSV) would be paid.
Early Termination Value
- GSV = (total Premiums paid excluding taxes * GSV Factor) – guaranteed cash backs already paid
- The SSV would be declared by the company based on its performance and would be calculated as:
Paid-up Sum Assured * SSV factors
If the policyholder has paid first year’s premium and 12 months have elapsed but the third year’s premium has not been paid, the policy could not be made paid-up neither surrendered. In this case, an Early Termination Value would be paid if the policyholder terminates the plan or does not revive it or dies, whichever is earlier. The value would be computed as:
- 11% of the premiums paid till termination date if 1 full year’s premium has been paid or,
- 15% of the premiums paid till termination date if 2 full year’s premium has been paid
Revival is allowed within 2 years from the date of the first unpaid premium. The policyholder would be required to pay the outstanding premium and any interest charged by the insurer to revive his policy.
If a loan is availed under a policy, the loan and the interest therein should not exceed the Surrender Value in the policy. If the policy is in-force, this does not happen. If the policy is made paid-up, the policyholder would be notified and the policy would be foreclosed.