This is a unit linked plan which offers good potential to grow your money and offers life cover also. The highlight of this plan is the extremely low level of charges, comparable with the mutual fund industry. Being a unit linked plan, it offers good growth potential if invested over a long period of time. All these factors make it a good investment cum insurance product which offers tax savings also.
|Launch Date||Policy Type||UIN|
How this plan works - You decide on the amount of money you want to invest on a monthly basis (you can invest in annual, quarterly, half-yearly or single mode also). You then select the term of the policy between 5 to 20 years. You can choose a premium payment term of 5, 7, 10 or pay every year of the policy term. Based on the premium amount and your age, your life cover gets decided automatically. The money which you pay is invested in the funds of your choice - you have 8 funds to choose from. Based on the amount you invest and the choice of funds, you will be allocated Units of these funds. The value of these funds depends on the NAV which are declared on a daily basis. So you can keep track of your investment and performance from Day 1.
Maturity Benefit - At the end of the policy term you will get the Fund Value in the policy. Just as an example, if you hold 1,000 units with an NAV of Rs. 53.26, the Fund Value will be 10,000 x 53.26 = Rs. 53,260. You have the option of withdrawing your money over a period of 5 years - details of this are mentioned under the Settlement Option which is explained below.
Settlement Option of Maturity Amount - You can choose to take the maturity amount over a 5 year period. The units you hold at maturity will be divided by 5 and each year you will get ⅕ of the Units. The existing units will continue to be invested in your funds and the Fund Management Charge would apply. There will be no risk cover during this period. Also no switching or partial withdrawal will be allowed during this period.
Death Benefit - In case of the death of the policyholder, the nominee will get the highest of the following:
|Age at Entry||30 days||65 days|
|Age at Maturity||18 years||75 years|
|Policy Term||5 years||20 years|
|Premium Payment Term||Single
Limited - 5, 7 & 10 years
Regular - same as policy term
|Premiums||Single - Rs. 24,000
Annual - Rs. 12,000
Half yearly - Rs. 6,000
Quarterly - Rs. 3,000
Monthly - Rs. 1,000
|Sum Assured - Single Premium||125% of Premium|
|Sum Assured - Limited & Regular
Age at entry <= 55 years
|10 x Annualised premium|
|Sum Assured - Limited & Regular
Age at entry > 55 years
|7 x Annualised premium|
Partial or complete withdrawal - You can make a partial withdrawal or a complete withdrawal of your funds at any time after the completion of 5 policy years. You should have attained the age of 18 years though to make partial withdrawals.
Premium Redirection - At any point of time, you can pay your future premiums to buy units from other funds of your choice. You are allowed upto 4 free premium redirections in 1 policy year.
Switching - You can move your accumulated funds to another fund at any point of time. You are allowed upto 4 free switches in 1 policy year.
Discontinuation of premiums - There are the following 2 scenarios:
Revival of your policy - You can revive your discontinued policy by paying all the missed premiums and on meeting any applicable underwriting criteria of the company. No interest will be charged on the missed premiums.
Loan - No loans are available in this plan.
Surrender - You can surrender your plan anytime after 5 policy years and receive the Fund Value. In case surrender before 5 years, the funds will move to the Discontinued Fund and you can withdraw after 5 years.
Grace period - You have a grace period of 15 days for the monthly payment mode and 30 days for other modes of premium payment.
Tax Benefits - The premiums paid are exempted from tax under Sec 80C. Please bear in mind that the annual premium should not be greater than 10% of the cover amount for this exemption to be applicable. The Maturity and Death Benefits are tax exempt under Sec 80D.
Important - The returns in your plan will depend on your choice of funds. So it is very important to choose them wisely. If you choose a Low Risk fund, the chances of returns will not be very high. If you are staying invested in 5 years or more it may make sense to go a bit aggressive on the type of fund as the chances of better returns will be higher. These funds are managed by experienced fund managers of HDFC Life.
|Fund Name||Fund Composition||Risk & Return Rating|
|Money Market Instruments, Cash, Deposits, Liquid Mutual Funds||Government Securities, Fixed Income Securities||Equity|
|Equity Plus||0% to 20%||0% to 20%||80% to 100%||Very High|
|Diversified Equity||0% to 40%||0% to 40%||60% to 100%||Very High|
|Blue Chip||0% to 20%||-||80% to 100%||Very High|
|Opportunities||0% to 20%||-||80% to 100%||Very High|
|Balanced||0% to 20%||0% to 60%||40% to 80%||Moderate to High|
|Income||0% to 20%||80% to 1000%||-||Moderate|
|Bond||0% to 60%||40% to 100%||-||Moderate|
|Conservative||0% to 60%||40% to 100%||-||Low|
Fund Management Charge - 1.35% per annum of the Fund Value, charged daily.
Mortality Charge - This will depend on your age and the amount of cover. This charge is deducted every month.
Partial Withdrawal Charge - You can make upto 4 free partial withdrawals in every policy year. Please note partial withdrawals can only be made after 5 policy years. For every partial withdrawal after the 4 free ones, a charge of Rs. 250 will be applied. In case you make the request online by yourself, a charge of only Rs. 25 will apply.
Switching Charge - You can make upto 4 free switches in every policy year. For every switch after the 4 free ones, a charge of Rs. 250 will be applied. In case you make the request online by yourself, a charge of only Rs. 25 will apply.
Premium Re-direction Charge - You can make upto 4 free premium redirections in every policy year. For every premium redirection after the 4 free ones, a charge of Rs. 250 will be applied. In case you make the request online by yourself, a charge of only Rs. 25 will apply.
If the premiums are not paid by the end of the grace period, the plan will be withdrawn and discontinued. This is what will happen:
That pretty much explains how HDFC Life Click2Invest Plan works and the benefits you get out of it. If you are looking for tax savings, life cover and flexibility to manage your funds, this plan is indeed a good option to consider. If you have any questions on this plan, drop in a line in the comments and we will be happy to help out.