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Birla Sun Life Insurance-Fortune Elite Plan

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Birla Sun Life Insurance-Fortune Elite Plan Review

BSLI Fortune Elite Plan is a Unit Linked Insurance Plan which provides market-linked returns on the premiums invested. Besides the returns, the plan also ensures protection through insurance coverage granted.


Highlights of the Birla Sun Life Insurance-Fortune Elite Plan

  • This is a Unit Linked Plan where premiums paid are invested in the market.
  • The plan has three investment options to choose from according to the policyholder’s investment strategy.
  • The policyholder can also change the investment strategies if required.


Working of the Birla Sun Life Insurance-Fortune Elite Plan

  • The policyholder decides on the amount of premium he wants to pay, the premium paying frequency and the investment option required.
  • The Sun Assured is higher of 10 times the annual premium paid or premium paid multiplied by half the selected term.
  • There are 3 investment strategies from which the policyholder can choose any one.
  • Under the first Systematic Transfer Option strategy, the net premium is first invested in the Liquid Plus Fund. Thereafter, every month, the investment is allocated to Enhancer, Maximizer or Super 20 Fund as per the policyholder’s choice. This strategy helps the policyholder to average out the risk inherent in the equity market. This investment option is available to policyholder’s who choose to pay annual premiums.
  • The second strategy is Return Optimizer Option. This option protects the returns generated from market volatility. Under this option, the net premium is invested in Maximizer Fund. The growth in this fund would then be tracked every day. Whenever the growth exceeds 110% of the net premium invested, the returns generated would be transferred to the Income Advantage Fund. This transfer of return protects the return from future volatility.
  • The third strategy is the Self-Managed Option wherein the policyholder manages his investments himself. 7 funds are available and the policyholder can choose to invest in any one or more of such 7 funds. The funds include the following:
    • Super 20
    • Maximizer 
    • Magnifier
    • Enhancer
    • Assure
    • Income Advantage
    • LiquidPlus
  • The premium paid, net of the applicable allocation charge is invested in the above funds based on the policyholder’s investment strategy.
  • If the policyholder dies during the tenure of the plan the death benefit is paid.
  • If the plan attains maturity, the maturity benefit is paid.


Benefits and Features of Birla Sun Life Insurance-Fortune Elite Plan

  • Maturity Benefit – On maturity, the Fund Value and any Top-up Fund Value available on the maturity date would be paid to the policyholder. 
  • Death Benefit – If the insured dies when the plan is in-force, the following death benefit would be paid:
    (Higher of the Sum Assured or Fund Value) + (higher of the top-up Sum Assured + top-up Fund Value)
    If the insured dies before attaining 60 years of age, the Sum Assured would be reduced by the amount of partial withdrawals made in the two years immediately preceding death
    If the insured dies after crossing 60 years of age, the Sum Assured would be reduced by the amount of partial withdrawals made from the Fund Value in the two years before attaining 60 years and all withdrawals made after attaining 60 years.
    The death benefit payable should not be lower than 105% of all premiums paid till death including any top-up premiums paid.
  • Bonus – Being a ULIP plan, bonus is not declared.
  • Guaranteed Additions – Two guaranteed additions are added to the Fund Value under the plan. The first addition is added at the end of the 10th policy year and every 5 years thereafter. The rate of this addition is determined as 2% of the aggregate premiums paid in the last 60 months. The second addition accrues from the 11th policy year and every year thereafter. The rate of this addition would be 0.35% of the average Fund Value in the last 12 months.
  • Claw-back Additions – As per the IRDA regulations, non-negative additions would be added to the Fund Value to fulfil the maximum reduction in yield criteria from the end of the 5th policy year.
  • Loan –Loan is not available under the plan.
  • 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.


COMPARE THIS PLAN WITH OTHER ULIP PLANS


Eligibility Criteria of Birla Sun Life Insurance-Fortune Elite Plan

The plan can be bought only by Resident Indians. The other eligibility criteria of the plan includes:
  Minimum Maximum
Entry age (Last Birthday) 1 year 55 years
Maturity Age (Last Birthday) NA 75 years
Plan tenure 20,25,30,35 or 40 years
Premium payable Rs.40,000 No limit
Premium Paying Term  5,10,15 or 20 years
Sum Assured Rs.4 lakhs No limit
Top-up Sum Assured 1.25 times the top-up premium if age is lower than 45 years
1.10 times the top-up premium if the age is 45 years and above
Premium payment mode Annually, half-yearly, quarterly or monthly



Applicable charges of Birla Sun Life Insurance-Fortune Elite Plan

Being a ULIP plan, there are certain charges applicable. The charges include the following:
  • Premium Allocation Charge – This charge is deducted on receipt of each premium before the premium is credited into the fund. The charges are:
Policy Year Premium Rs.40,000 to Rs.249,999 Premiums Rs.2.50 lakhs and above
1 to 2 5.50% 4.50%
3 onwards 5% 4%

Top-up premiums would be charged a flat rate of 2% as allocation charges.
  • Policy Administration Charge – A monthly charge of 0.6% of the premium paid is deducted from the fund value at the start of each month. The charge is subject to a maximum of Rs.6000 p.a.
  • Fund management Charge – These charges depend on the type of fund selected and are charged on a daily basis. The applicable charges are:
Fund Type Charge
Super 20 1.35% per annum
Maximizer 1.35% per annum
Magnifier 1.35% per annum
Enhancer 1.25% per annum
Assure 1% per annum
Income Advantage 1% per annum
Liquid Plus 1% per annum
 
  • Miscellaneous Charges – A charge of Rs.50 per transaction for any service rendered like switching, pre-redirection, partial withdrawals, etc. could be charged. This charge could increase subject to a maximum of Rs.500.
  • Discontinuance Charge – Applicable for policies in which premiums are discontinued. The charges are:
Year of Discontinuance Charge
1 Lower of 6% of annual premium or Fund Value up to a maximum of Rs.6000
2 Lower of 4% of annual premium or Fund Value up to a maximum of Rs.5000
3 Lower of 3% of annual premium or Fund Value up to a maximum of Rs.4000
4 Lower of 2% of annual premium or Fund Value up to a maximum of Rs.2000
5 year onwards Nil
 
  • Mortality charge – This charge is deducted on the first day of each month based on the Sum at Risk and the policyholder’s age


Additional Benefits of Birla Sun Life Insurance-Fortune Elite Plan

  • Riders – There are no riders under this plan.
  • Partial Withdrawals – Unlimited partial withdrawals are allowed in the plan after a completion of 5 policy years. The minimum amount of partial withdrawal is Rs.5000 and in one year, the maximum allowed withdrawal amount is 25% of the Fund Value as at the beginning of the year. The policyholder should maintain a minimum balance of one Basic Premium and any top-up premiums paid in the preceding 5 years in the Fund Value after withdrawal.
  • Switching –Switching between investment strategies is allowed if done after one year of policy continuance. Switching from the Return Optimizer Option is not allowed.  Under the Self-Managed Option, switching between different funds is allowed provided the minimum switching amount is Rs.5000.
  • Premium Redirection –Under the Self-Managed Option, premiums can also be redirected into other funds from the next policy anniversary.
  • Top-up Premiums – Additional premiums by way of top-up premiums are allowed after the first 5 policy years. The minimum amount of top-up is Rs.5000 and every top-up premium has a lock-in of 5 years.
  • Grace Period – A grace period of 30 days is allowed for annual, half-yearly and quarterly payment of premium and 15 days for monthly mode of premium payment.
  • Free Look Period – A cooling off period or a free look period of 15 days (30 days for distance marketing channels) 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


Exclusions in Birla Sun Life Insurance-Fortune Elite Plan

  • If the policyholder commits suicide anytime during the plan tenure, the available Fund Value and any top-up premium Fund Value would be paid to the nominee.


Non-Payment of Premiums in Birla Sun Life Insurance-Fortune Elite Plan

Premiums should be compulsorily paid for the first 5 policy years. If they are not paid, the policyholder can surrender the policy and the surrender benefits would be available after the lock-in premium of 5 years. If premiums for the first 5 years are paid and are later discontinued, the policyholder can either surrender the policy and avail the surrender value or continue the policy on a paid-up basis.


Surrendering the policy

  • Within the first 5 policy years
The policy has a 5 year lock-in period. If the policy is surrendered within the first 5 years, the funds in the Fund Value and any top-up Fund Value would be transferred to the Linked Discontinued Policy Fund after deducting the Discontinuation charges. This fund would earn a minimum interest of 4% per annum. The money would remain in the Discontinuance Policy Fund till the completion of 5 years and the Fund Management charges would be deducted as and when applicable. If the policyholder dies during this period, the Fund Value as on the date of death would be paid. Otherwise, after the completion of the lock-in period of 5 years, the available Fund Value would be paid
 
  • After 5 years
If the plan is surrendered any time after the completion of 5 years, the available Fund Value and any top-up Fund Value would be paid without deduction of any charges.

Making the policy Paid-up

This option is available only if premiums for the first 5 years are paid and then discontinued. In case the policyholder does not wish to surrender his policy, he can continue the policy on a paid-up basis. Under a paid-up policy, the Sum Assured would be reduced and called Paid-up Sum Assured. It would be calculated as follows:

Paid-up Sum Assured = Sum Assured * (number of premiums paid/total number of premiums payable)

The death benefit would be calculated using the Paid-up Sum Assured.


Revival

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.

 
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