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SBI Life Smart Wealth Builder Plan

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SBI Life Smart Wealth Builder Plan

SBI Life Smart Wealth Builder is a unit-linked insurance plan which offers some guaranteed additions at various points in your policy term. Your nominee will get the Sum Assured or Fund Value, whichever is higher as Death Benefit. On Maturity, you will get the Fund Value as a lumpsum amount.


 

Basic Features of SBI Life Smart Wealth Builder Plan

Plan Type - There are 3 plan types which you can select. This will depend on the number of years, you want to pay the premiums.
 
  • Regular Premium - In this plan type, you will have to pay the premium throughout the policy term
  • Limited Premium - In this you will have the option for paying only for a few years.
  • Single Premium - You opt to make only one single payment at the time of purchasing the policy.
 
Policy Term - Based on the Plan Type, you can select the policy term as follows:
 
  • Regular & Limited Premium - 10 years, 15 to 30 years
  • Limited Premium - 5 to 30 years

Premium Payment Term (PPT) - Based on the Plan Type, you can select the premium payment term as follows:
 
Single Premium One-time
Regular Premium Same as selected policy term
Limited Premium For policy term of 10 years - PPT could be 5 / 8 years
For policy term of 15 to 30 years - PPT could be 5 / 8 / 10 years


Premium Payment Frequency - In case of Regular & Limited Premium, you have to pay the premiums annually.

COMPARE THIS PLAN WITH OTHER ULIP PLANS


Eligibility criteria for buying SBI Life Smart Wealth Builder Plan

 
  Minimum Maximum
Entry Age 7 years Regular & Limited Premium - 60 years
For Single Premium - 65 years 
Maturity Age Regular & Limited Premium - 17 years
Limited Premium - 12 years
70 years
Premiums Regular Premium - Rs. 30,000
Limited Premium - Rs. 40,000
Single Premium - Rs. 65,000
Rs. 3,00,000
 


How does SBI Life Smart Wealth Builder Policy work?

The money invested by you, after deduction of charges, is invested in the funds of your choice. The list of charges is explained later in this page. You will be allotted Units of the funds which have been purchased. The value of your funds at any point of time will be as mentioned below. The NAV (Net Asset Value) is published on a daily basis.
 
Your Fund Value = Total Units x NAV of Fund
 
If your policy is active (you have been paying all premiums on time), then this plan will provide you Guaranteed Additions, in the form of premiums, to purchase units. The amount and timing of Guaranteed Additions provided to you is as shown in the table below.

 

End of Policy Year

Regular Premium Plan

Limited Premium Plan

Single Premium Plan

 

 

 

PPT = 5 yrs

PPT = 8 yrs

PPT = 10 yrs

10

5%

5%

5%

5%

5%

15

15%

5%

10%

10%

5%

20

25%

10%

10%

15%

5%

25

35%

10%

10%

20%

7%

30

45%

10%

15%

25%

8%



Let me explain this with the help of an example - If you have taken a Regular Premium Plan and paying Rs. 40,000 as Annual Premium for a 30 year policy term, you would get Guaranteed Additions in the form for premiums as mentioned below. The Guaranteed Additions would be used to buy the Units of the Funds and would be credited to your plan. These are as shown in the cells shaded in blue.

At the end of the 10 policy years - You get 5% of Rs. 40,000 = Rs. 2,000 to buy Units
At the end of the 15 policy years - You get 15% of Rs. 40,000 = Rs. 6,000 to buy Units
At the end of the 20 policy years - You get 25% of Rs. 40,000 = Rs. 10,000 to buy Units
At the end of the 25 policy years - You get 35% of Rs. 40,000 = Rs. 14,000 to buy Units
At the end of the 30 policy years - You get 45% of Rs. 40,000 = Rs. 18,000 to buy Units
 

Benefits in SBI Life Smart Wealth Builder Plan

Death Benefit 
 
You get the higher of the Sum Assured or the Fund Value at the time of death with a minimum of 105% of all premiums paid.
 
The Sum Assured will be calculated as follows:
 

Plan Type

Minimum

Maximum

Age < 45

Age >= 45

Age < 45

Age >= 45

Regular Premium

Higher of

(10 x AP) or

(0.5 x Term x AP)

Higher of

(7 x AP) or

(0.25 x Term x AP)

10 x AP

20 x AP

Limited Premium

15 x AP

15 x AP

Single Premium

1.25 x SP

1.1 x SP

3 x SP

1.25 x SP



AP - Annual Premium; SP - Single Premium
 
So at the time of buying SBI Smart Wealth Builder Plan you will have to decide on the premium amount which you want to pay. Once you decide on that, you will have to select the Sum Assured based on the table given above. That will decide the amount of cover you wish to have from the beginning.
 
In this plan you have the flexibility to make partial withdrawals. So the Death Benefit will be reduced to the extent of partial withdrawals made in the last 2 years for age on death below 60 years and for age on death 60 years of above, all partial withdrawals made from the age of 58 onwards.
 
 
Maturity Benefit 
 
At the end of the policy term, you will get the Fund Value.
 
You can also choose to take the maturity benefits in installments to get a regular flow of income. You can choose a period between 2 to 5 years from the date or maturity to get this regular payout. This period is called the Settlement Period. This is how it works:
  • The funds will remain invested in the same funds that you are invested in. You will have to bear the investment risk. Which means that the markets may go up or down in this period and there is a chance that the Fund Value will change. 
  • In the Settlement Period the Fund Management Charge would be applicable.
  • You can choose to get the payments in monthly, quarterly half-yearly or annual mode.
  • Once you decide on the number of years (between 2 to 5 years) in which to receive the payments and the frequency, the Fund Value would be divided by that count and the first payment would be made to you. 
  • Every other payment would be based on the Fund Value divided by the balance number of installments. 
  • At any point, you can choose to withdraw all the balance amount and stop the installments. 
  • In case of death of the policyholder in the Settlement period, the remaining Fund Value will be paid to the nominee in lumpsum.


Charges in SBI Life Smart Wealth Builder Plan

Premium Allocation Charge
 
When you pay the premiums, this charge is deducted and then the balance amount is invested. So this charge is applied every time you make a premium payment. The charge is applicable as follows:

 

Policy Year

Regular Premium

Limited Premium

Single Premium

PPT = 5

PPT = 8

PPT = 10

1

9.0%

9.0%

9.0%

9.0%

3%

2

6.5%

6.5%

6.5%

6.5%

-

3

6.5%

6.5%

6.5%

6.5%

-

4

6.5%

6.5%

6.5%

6.5%

-

5

6.0%

6.0%

6.0%

6.0%

-

6

3.5%

-

3.5%

3.5%

-

7

3.5%

-

3.5%

3.5%

-

8

3.0%

-

3.0%

3.0%

-

9

3.0%

-

-

3.0%

-

10

3.0%

-

-

3.0%

-

11 onwards

-

-

-

-

-



Fund Management Charge
 
While calculating NAV on a daily basis, the following percentage of the Fund Value would be deducted as per the rates mentioned below. You have the option of choosing the Funds which you want to stay invested in.
 

Fund Name

Fund Management Charge

Equity Fund

1.35% per annum

Top 300 Fund

1.35% per annum

Equity Optimiser Fund

1.35% per annum

Growth Fund

1.35% per annum

Balanced Fund

1.25% per annum

Bond Fund

1.00% per annum

Money Market Fund

0.25% per annum

Discontinued Policy Fund

0.50% per annum



Policy Administration Charge
 
A monthly charge is deducted by cancelling the number of units which you hold. The charge applicable is as follows:

 

Policy Year

Regular & Limited Premium

Single Premium

1 to 5

Nil

Rs. 50/month

6 onwards

Rs. 60/month

Rs. 50/month



Policy Administration Charge
 
If you choose to discontinue your policy, the following charges would be deducted before making you a payout. This is as a % of the Fund Value or the Annual Premium.

For Single Premium Plans:

 

Year of Discontinuance

Discontinuation Charge

1

Lower of 1% of (Single Premium or Fund Value) subject to a maximum of Rs. 6,000

2

Lower of 0.5% of (Single Premium or Fund Value) subject to a maximum of Rs. 5,000

3

Lower of 0.25% of (Single Premium or Fund Value) subject to a maximum of Rs. 4,000

4

Lower of 0.1% of (Single Premium or Fund Value) subject to a maximum of Rs. 2,000

5 onwards

Nil



For Regular Premium Plans:
 

Year of Discontinuance

Discontinuation Charge

1

Lower of 6% of (Single Premium or Fund Value) subject to a maximum of Rs. 6,000

2

Lower of 4% of (Single Premium or Fund Value) subject to a maximum of Rs. 5,000

3

Lower of 3% of (Single Premium or Fund Value) subject to a maximum of Rs.4,000

4

Lower of 2% of (Single Premium or Fund Value) subject to a maximum of Rs. 2,000

5 onwards

Nil



Switching Charge
You are allowed to make 2 free switches in your funds every year. Every additional switch will attract a Rs. 200 charge.
 
Partial Withdrawal Charge
You are allowed to make 1 free partial withdrawal every year. Every additional partial withdrawal will attract a Rs. 100 charge.
  
Mortality Charge
This charge is for providing the life insurance coverage for you at all times during the policy period. This is deducted by cancelling of Units you hold at the beginning of each month. 
 

Which are the Funds you can invest in SBI Life Smart Wealth Builder Plan?

 You have the following 7 fund options which you can choose to invest in. Depending on your risk profile, you should make this decision. The funds will be invested in the asset class within the ranges mentioned here. 

1. Equity Fund - this fund has high exposure to equity. This funds targets high returns in the long term. The Risk Profile is categorised as “High”.
 

Assets

Minimum

Maximum

Equity & Equity related instruments

80%

100%

Debt instruments

0%

20%

Money Market instruments

0%

20%



2. Top 300 Fund - this funds seeks to provide long term capital appreciation by investing in the Top 300 companies of the National Stock Exchange based on their market capitalisation. The Risk Profile is categorised as “High”.
 

Assets

Minimum

Maximum

Equity

60%

100%

Cash & Money Market instruments

0%

40%



3. Equity Optimiser Fund - similar to Equity Fund. The Risk Profile is categorised as “High”.
 

Assets

Minimum

Maximum

Equity & Equity related instruments

60%

100%

Debt instruments

0%

40%

Money Market instruments

0%

40%


4. Growth Fund - similar to Equity Fund with small parts invested in Debt instruments. The Risk Profile is categorised as “Medium to High”.
 

Assets

Minimum

Maximum

Equity & Equity related instruments

40%

90%

Debt instruments

10%

60%

Money Market instruments

0%

40%



5. Balanced Fund - similar to Growth Fund with a higher Debt investments. The Risk Profile is categorised as “Medium”.
 

Assets

Minimum

Maximum

Equity & Equity related instruments

40%

60%

Debt instruments

20%

60%

Money Market instruments

0%

40%



6. Bond Fund - There is no equity investments. The objective is to provide relatively safe and less volatile investments.  The Risk Profile is categorised as “Low to Medium”.
 

Assets

Minimum

Maximum

Debt instruments

60%

100%

Money Market instruments

0%

40%



7. Money Market Fund - There is no equity investments. Investments are into relatively safe assets.  The Risk Profile is categorised as “Low”.
 

Assets

Minimum

Maximum

Debt instruments

0%

20%

Money Market instruments

80%

100%


Then there is the Discontinued Policy Fund - in case the policy is discontinued before the lock-in period, your funds will be parked here and earn a 4% rate of return. This rate will be as decided by the insurance regulator.
 


Flexibility Options in SBI Life Smart Wealth Builder Plan

 

Changing the Sum Assured of the plan

After 5 policy years, you have the option to alter the Sum Assured on the plan. You may increase or decrease it. The conditions for doing them is as follows:

  1. All premiums should have been paid on time
  2. You can do so only 3 times during the policy
  3. It is subject to underwriting approval
  4. You age has to be below 50 years
  5. Once decreased, the Sum Assured then cannot be increased in future
  6. Cost of medicals will have to be borne by you
  7. Premiums may change
  8. All eligibility criteria should be met



Switching Funds
 
You may switch your investments to any of the 7 Funds options to alter your investment needs. You can make 2 free switches every year. For every extra switch in the same policy year you will be charged Rs. 100. You have to switch a minimum of Rs. 5,000 worth of funds.
 
 
Premium Re-direction
 

After the 1st policy year, you can re-direct your further investments into any other funds of your choice. There is no charge for this.
 
 
Partial withdrawal of your Funds
 
You are allowed to make partial withdrawals from the 6th policy year onwards. You will have to be of 18 years of age also.
 
  • You can with withdraw a minimum of Rs. 5,000 and a maximum of 15% of the Fund Value
  • No partial withdrawals will be allowed, if it results in the Fund Value becoming less than 50% of all premiums paid so far
  • You can make 1 free partial withdrawal in a year. The next one in the same year will be charged Rs. 100
  • You can make a maximum of 2 partial withdrawals in a policy year
  • In case the policy term is less than 11 years, then you can make a maximum of 5 partial withdrawals throughout the policy term
  • In case the policy term is greater than 10 years, then you can make a maximum of 10 partial withdrawals throughout the policy term 


Tax Benefits in SBI Life Smart Wealth Builder Plan

 
The premiums paid by you and the Maturity Benefits are exempted under Income Tax rules. Income tax laws are subject to change from time to time.


Other features related to premium payment

 
Free Look Period - In case you do not wish to continue with the policy for whatever reason, you can exit the plan within 15 days of receiving the policy document. For policy purchased through distance marketing, the free look period is 30 days.
 
The Fund Value would be returned to you based on the NAV of that day. Mortality charges for the few days, Medical test costs, taxes and agreement costs will be deducted though.
 
 
Grace Period - You will get a grace period of 30 days for payment of your annual premiums. Which means that you have 30 days even after the date or premiums have elapsed.
 
Surrendering the plan - Your funds are locked-in for 5 years. So you cannot get your money for 5 years after buying the policy. 
 
If you make the surrender request within the 1st 5 years, your investments will be moved to the Discontinued Policy Fund after deduction of Discontinuation Charge. This fund will guarantee a minimum return of 4%. Fund Management Charge will continue to apply.
 
If you make the surrender request after 5 years, your Fund Value will be given to you without deducting any Discontinuation Charges.
 
Click to download the SBI Life Smart Wealth Builder Brochure.
 
If you have any questions on the this plan, please drop a comment below and we would be happy to help.
 
NAV of all funds in SBI Life Smart Wealth Builder Plan
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