Investment Of Funds:

The premiums allocated to purchase units will be strictly invested according to the investment pattern committed in various fund types.  Various types of fund and their investment pattern will be as under:

The Policyholder has the option to choose any ONE of the above 4 funds. In case no fund has been opted for, the allocated premiums shall, by default, be invested in the INCOME FUND.


Method Of Calculation Of Unit Price:

Units will be allotted based on the Net Asset Value (NAV) of the respective fund as on the date of purchase of Units.  There is no Bid-Offer spread (the Bid price and Offer price of units will both be equal to the NAV).  The NAV will be computed based on investment performance under each fund type and shall be calculated as under:

Market/ Fair value of the chosen fund’s underlying assets

Plus Current Assets, accrued income (net of Fund Management charge and other outgo) less Current Liability and Provisions

Net Asset Value = Number of units existing in the fund at the valuation date


Charges Under The Plan:

I) Allocation Rate:
The allocation rate applicable to the premium to determine the part of premium utilized to purchase units in the Policyholder’s Unit Account will depend on  whether the policy is a Single Premium or Regular Premium contract and on the premium size as under:

Single premium:

Under Single premium policies an amount equal to (1 – the allocation rate) times the Single Premium will also be deducted at the First policy anniversary by canceling an appropriate number of units from the Policyholder’s Unit Account.

Regular premium (in case premium is paid yearly or half-yearly):

Allocation rate for Top-up (additional premium): 0.9875

II) Other Charges:
The Following charges shall be deducted by canceling appropriate number of units out of the Policyholder’s Unit account:

i) Life cover and Critical Illness Benefit rider Charge – Charges for Life cover and Critical Illness Benefit Rider will be taken every month by canceling appropriate number of units out of the Policyholder’s Unit Account as per the rate prevalent at the time of policy issue or as amended by LIC from time to time based on actual experience.

ii) Accident Benefit charge: Rs.0.50 per thousand Accident Benefit Sum Assured per policy year by canceling appropriate number of units out of the Policyholder’s Unit Account.

iii) Administrative charge: If Life cover is opted for, then there will be an Administrative charge of Re.1%o Sum Assured under the Basic Plan subject to a maximum of Rs.1000 in each of the first 2 years.

iv) Policy Charge: Rs.0.10%o Sum Assured under the Basic Plan, where risk cover is opted for, in each of the first 2 years. In case no Life cover is opted for, the Policy charge in each of the first 2 years will be equal to Rs.0.10%o of the total Premiums payable throughout the policy term.

v) Service Tax Charge: This charge shall be levied on the Life cover, Accident Benefit and Critical Illness Benefit charges, if any, and shall be taken by canceling appropriate number of units on a monthly basis as and when the corresponding Life cover, Critical Illness and Accident Benefit charges are deducted. The level of this charge will be as per the rate of Service Tax on risk premium, if any, as applicable from time to time.

vi) Flat fee: Rs.15/- per month will be charged throughout the term of the policy by canceling appropriate number of units out of the Policyholder’s Unit Account.


III) Fund Management Charge:
Fund dependent deductible on the date of computation of NAV:

                              1.00% p.a. of Unit Fund for “Bond” Fund

                              1.00% p.a. of Unit Fund for “Income” Fund

                              1.25% p.a. of Unit Fund for “Balanced” Fund

                              1.50% p.a. of Unit Fund for “Growth” Fund

IV)   Bid/Offer Spread – Nil.

V)  Right to revise charges:
The Corporation reserves the right to revise all or any of the above charges, including the right to change the manner in which charges are to be recovered. The Corporation may also introduce new charges, as and when such a need may arise. The modification in charges will be done with prospective effect with the prior approval of IRDA after giving the policyholders a notice of 3 months. In case a policyholder does not agree with the modified charges, he/ she shall be allowed to withdraw the Bid Value of the units held in his/her Unit Account without any surrender charge, if any.

Although the charges are review able, they will be subject to the following maximum limits:

- Flat Fee will be subject to a maximum of Rs.50 per month.
- Administrative charge shall not exceed Rs.2%o Sum Assured under the Basic Plan, if any, subject to a maximum of Rs.2000 in each of the first 2 years.
- Policy charge will be fixed depending on the amount prescribed by the Indian Stamp Act, 1899.
- Fund Management Charge: The Maximum for each Fund will be as follows:

Surrender Charge:

The Surrender charge will be as under:

i) Single Premium

ii) Regular Premium

Tax Implications on Surrender

Currently, as per the sub-section(2) of Section 80CCC of the Income Tax Act, 1961 any amount taken on account of surrender under the above plan shall be chargeable to tax as income in the year of surrender.

Partial Surrender:

No partial surrender of units will be allowed under this plan.


Revival Or Reinstatement:

In case of lapsed policy, the Policyholder shall have the option of reviving the policy at any time during the premium paying term but within a period of 5 years from the due date of the First Unpaid Premium, by paying all unpaid premiums without interest and on submission of proof of continued insurability to the satisfaction of the Corporation.


Risks Borne By The Policyholder:

The Value of the units and hence the Benefit relating to the policyholder’s unit account is subject to market and other risks and there can be no assurance that the objectives of any of the above funds will be achieved. Further, the value of units within each Fund can go up or down depending on different factors affecting the capital markets and may also be affected by changes in the general level of interest rates and other economic factors. All benefits under the policy are also subject to the Tax Laws and other Financial enactments as they exist from time to time.


Cooling Off Period:

If policyholder is not satisfied with the “Terms and Conditions” of the policy, he/she may return the policy to us within 15 days from the date of receipt of the Policy Bond.


Loan:

No loan will be available under this plan.


Assignment:

No assignment will be allowed under this plan.


Exclusions:

No risk claim will be paid in case the Policyholder commits suicide (whether sane or insane at the time) at any time on or after the date on which the risk under the policy has commenced but before the expiry of one year from the date of commencement of risk under this policy and the Corporation will not entertain any claim by virtue of this policy except to the extent of the Bid Value of the Policyholder’s Unit Account on the date of death, subject to deduction of the charge for premature surrender as mentioned under Section 8 above.


Dating Back:

No dating back of the policy will be allowed under this plan.