HDFC Life Single Premium Pension Super Plan

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HDFC Life Single Premium Pension Super Plan

HDFC Life Single Premium Pension Super Plan is a Single Premium Unit Linked Deferred Annuity Plan or Pension Plan. Thus, it is a Non-Traditional Insurance Plan without Bonus facility.
 
How it works – In this plan, premium needs to be paid in a lumpsum while the policy continues for the entire policy tenure of 10 years. The premium paid, net of charges, is invested in Pension Fund. At the end of the policy term, the higher of Fund Value or 101% of single premium +Top Up (if any) is accumulated as Maturity Benefit. The Corpus accumulated during the entire policy tenure is used to provide annuity once the policy matures.
 
At the time of vesting, i.e. on Policy Maturity or Surrender, there are a few options available to the policyholder:
  1. Purchase HDFC Life Immediate Annuity Plan or any other Annuity Provider for the full corpus
  2. Withdraw 1/3rd of the corpus tax free under section 10(10)A and purchase annuity for the remaining 2/3rd of the corpus
  3. Use the proceeds or corpus to purchase another single premium deferred annuity plan
  4. If age of policyholder is less than 55 years, then he can extend the deferment / accumulation period for another 5 years and remain invested without additional payment of premium
 
Now, if the policyholder wishes to purchase annuity, then he would have to purchase HDFC Life Immediate Annuity Plan as per the rules of IRDA. Now, in this Immediate Annuity Plan, the accumulated corpus will be paid as a single premium to purchase annuity. In this plan, there are 5 annuity options to avail from:
  1. Life Annuity
  2. Joint Life Annuity
  3. Life Annuity with Return of Purchase Price
  4. Life Annuity with Guarantee upto 15 years
  5. Life Annuity Return of Balance Purchase Price
 
However, if the Annuitant dies within the policy tenure, the higher of Fund Value or 101% of single premium +Top Up (if any) is accumulated as Death Benefit. The nominee has the option to take this amount as annuity or withdraw the entire proceeds as Death Benefit and terminate the plan.
 

Key Features of HDFC Life Single Premium Pension Super Insurance Plan

  • It is a Single Premium Deferred Annuity plan
  • The Policy Tenure is 10 years
  • The higher of Fund Value or 101% of single premium +Top Up (if any) is accumulated as Maturity Corpus which is used for annuity
  • If the Annuitant dies within the policy tenure, the higher of Fund Value or 101% of single premium +Top Up (if any) is accumulated as Death Benefit which can be taken by the nominee as a lumpsum or as annuity
  • There are 5 annuity options available
  • There is only 1 fund for investment purpose
 
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Benefits you get from HDFC Life Single Premium Pension Super Insurance Policy

Death Benefit – In case of death of the Annuitant within the Policy Tenure, the higher of Fund Value or 101% of single premium +Top Up (if any) is accumulated as Death Benefit which can be taken by the nominee as a lumpsum or as annuity.
 
Maturity Benefit – When the policy matures, the higher of Fund Value or 101% of single premium +Top Up (if any) is accumulated as Maturity Benefit. The corpus can be used in various ways or purchase any of the 5 available options of annuity from HDFC Life Immediate Annuity Plan.
 
Income Tax Benefit - Life Insurance premiums paid up to Rs. 1,00,000 are allowed as a deduction from the taxable income each year under section 80C and 1/3rd of the Maturity proceeds are tax free under section 10(10)A subject to fulfilment of terms and conditions
 
 

Eligibility conditions & other restrictions in HDFC Life Single Premium Pension Super Policy 

 
Minimum
Maximum
Policy Term (in years)
10
Premium Payment Term (in years)
Single
Entry Age of Annuitant (in years)
40
75
Age at Vesting / Maturity (in years)
50
85
Single Premium (in Rs.)
25,000
No Limit
Payment modes
Only Single
 
 

Additional Features and Benefits of HDFC Life Single Premium Pension Super Plan                

Riders – There are No Additional Riders in this plan
 
Investment Fund Options
In this plan, there is only 1 Fund for investment purpose- Pension Fund
 
Top-up – Top Up Premium is not allowed in the last 5 policy years and each top up premium has a lock in of 5 years. The minimum Top Up Amount is Rs 10,000.
 
Switching – Switching is not possible in this plan since there is only 1 Fund available for investment.
 
Partial Withdrawal – Being a Deferred Annuity Plan, Partial Withdrawal is not allowed in this plan.
 
Annuity Options – In this plan there are 5 options for Annuity:
  1. Life Annuity- In this option, Annuity will be paid as long as the annuitant is alive and nothing further is payable after his death
  2. Joint Life Annuity- In this option, Annuity will be paid as long as the annuitant is alive and after his death, as long as his spouse is alive and nothing further is payable after both of them die
  3. Life Annuity with Return of Purchase Price- In this option, Annuity will be paid as long as the annuitant is alive and after his death the Purchase Price of the Annuity will be paid back to the nominee
  4. Life Annuity with Guarantee(upto 15 years) - In this option, Annuity will be paid for a minimum guarantee of 15 years and then will continue as long as the annuitant is alive and nothing further is payable after his death
  5. Life Annuity Return of Balance Purchase Price - In this option, Annuity will be paid as long as the annuitant is alive and after his death the Balance Purchase Price of the Annuity, i.e. Purchase Price of Annuity – sum of total Annuity paid till date, will be paid back to the nominee
 

Charges in HDFC Life Single Premium Pension Super Plan

Premium Allocation Charge – This charge is deducted from the Premium Paid by you
 
Policy Year
Premium Allocation Charge
Single Premium
2.5% of the Single Premium Amount
Top Up Premium
1.0% of the Top Up Premium Amount
 
 
Policy Administration Charge— This is the charge for the administrative working of the policy and is deducted by cancellation of units on a monthly basis. There will be a maximum charge of Rs 500 p.m.

 

Premium Allocation Charge
%of Total Premiums Paid
Monthly Charge
0.13%of Total Premiums Paid
 
 
Fund Management Charge– This charge is deducted by adjusting the NAV of the units on a daily basis.
 
Type
Charge
Pension Fund
1.35% of the Pension Fund Value
 
 
Investment Guarantee Charge– This charge is deducted by adjusting the NAV of the units on a daily basis. This charge is for policies which are in-forced and not discontinued.
 
Type
Charge
Investment Guarantee Charge
0.4% of the Pension Fund Value p.a.
 
Discontinuation Charge— This charge is for discontinuing the plan before the end of the Policy Tenure. Being a single premium plan, there is no Discontinuation Charge.
 
Mortality Charge — This charge is paid for the Life Coverage provided according to the Sum At Risk. This is based on the mortality rates which are specified for all ages and amount of cover being provided.
 
Service Tax would be applicable on the charges depending on the applicable rates.

 

What happens if?

You stop paying the premium – Being a single premium plan; there is no requirement of further payment of premium.
 
You want to surrender the policy – If you surrender the plan before the 5th policy year, the fund value would be moved to the Discontinued Fund and will earn a minimum guaranteed interest as prescribed by the IRDA. The Fund Value would be paid out after the completion of the 5th policy year.
However, if you surrender the plan after the 5th policy year, the Fund Value would be paid out as Surrender Benefit which can be availed as an annuity option, as per annuity guidelines of the IRDA.
 
You want a loan against your policy – Loan facility is not available in this plan.
 
 

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