Max New York Life Flexi Fortune Plan


Name of Policy

Max New York Life Flexi Fortune Plan

Type of Policy

ULIP

Various Investment Options

Choice  of six well managed funds to suit your risk appetite:

·         Growth Super Fund

·         Conservative Fund

·         Secure Fund

·         Growth Fund

·         Balanced Fund

·         Money Market Fund

PACE: Progressive Auto Cover Enhancement – Automatic 10% increase of the 1st year’s Sum Assured each year, starting from year 2 till Policy Tenure with no increase in premium.

 

Features

Parameter

Value

Minimum/Maximum Entry Age of Life Insured

7/50 years

Maximum Age of Life Assured at Maturity

70 years

Premium Payment Term & Policy Term

Limited Pay

5 Pay – 10 year term

10 Pay – 15 year term

15 Pay – 20 year term.

Premium Payment Mode

Annual, Semi-Annual, Quarterly & Monthly Modes.

(Quarterly and Monthly modes are allowed through ECS only)

Minimum Annual Target Premium

5 pay/10 year term: Rs. 50,000 for all modes

10 pay/15 pay: Annual mode Rs 24,000 p.a.

Semi Annual, Quarterly, Monthly: Rs. 36,000 p.a.

Maximum Annual Target Premium

Rs 100,000 for all Premium modes

Sum Assured(S.A) Multiples(basis age of life insured at the time of proposal)

Up to age 30:10/20/30 times of ATP

Age 31 to 40: 10/20 times of ATP

Age 41 to 50: 10 times of ATP

Riders Offered

Personal Accident Benefit, Dread Disease

 

Charges

Explanation

Premium Allocation Charge

Policy Year

% of Annual Target Premium

1

5%

2 & onwards

4%

Policy Administration Charge

This is a charge expressed as fixed amount of Rs.960 p.a. for 10 year policy term and Rs 600 p.a. for 15/20 year policy terms. This charge will inflate @ 5% p.a. compounded annually starting from the 2nd Policy Year onwards.

Mortality Charge

Mortality Rates per thousand sum at risk:

Age

25

30

35

40

Mortality Charge(Rs)

1.43

1.67

2.28

3.43

Switching Charge

No switching charge is applicable, 12 switches are allowed in a policy year and all are free of charge

Redirection Charge

No redirection charge is applicable, 12 redirections are allowed in a policy year and all are free of charge.

Partial Withdrawal Charge

No Partial Withdrawal charge is applicable, 12 partial withdrawals are allowed in a policy year and all are free of charge.

Surrender/Discontinuance Charge

No Surrender/Discontinuance Charge shall be levied from the 5th policy onwards.

If Policy is surrendered/discontinued.

Surrender/Discontinuance charge shall be lower of the following:

If Policy is surrendered/discontinued

Surrender/Discontinuation Charge shall be lower of the following

As a %age of ATP

As a %age of Fund Value

Fixed amount

In 1st Policy Year

6%

6%

6,000

In 2nd Policy Year

4%

4%

5,000

In 3rd Policy Year

3%

3%

4,000

In 4th Policy year

2%

2%

2,000

 

Fund Management Charge*

Fund Name

Growth Fund

Growth Super Fund

Balanced Fund

Conservative Fund

Money Market Fund

Secure Fund

Secure Plus Fund***

Fund Management Charge p.a.

1.25%

1.25%

1.10%

0.90%

1.25%**

0.90%

0.90%

* Charges shall not increase during the term of the policy and are subject to the term and approval of the authority.

** Under this fund, declared NAV will not be less than the previous day NAV for which a cost of guarantee charge of 0.35% p.a. is levied and is included within the FMC of 1.25% p.a.

*** Available only with STP option.

Illustration

Let us assume a simple case:

  •      Your age: 30 years
  •      Protection Cover: 10xAnnual Premium
  •      Policy term: 20 years
  •      ATP: Rs.50,000
  •      Maturity Value @ 10%: Rs. 20,40,857 @6%: Rs. 11,93,950

The life insurance component is miniscule, not exceeding 10/20/30 times your annual premium. If you really want life insurance, a good term plan will give you life insurance of about 500 times your annual premium – so you would rather avoid the … fund.

Let’s see what you get:

  •      life cover plus Investment
  •      Of your first year premium of Rs.50,000/-  5%+Rs 600 p.a.+ Mortality charge is removed. Most of this goes to your agent’s pocket. Only the remaining gets invested in the fund.
  •      Of your second year premium of Rs.50,000/- 4%+Mortality charge gets removed again. Most of this again goes to your agent, and only the remaining gets invested.
  •       In addition to this, of your total fund, the fund management charge of ~1.35% is cut every year
  •       Instead, if this Rs.50,000 per year had gone into a Systematic Investment Plan in a Mutual Fund, giving a return of approximately 15% a year on a five year average, not a single Rupee would have been deducted as policy charges. It would not take a mathematician to deduce that the returns here will be much better.

 

In summary, investments can deliver returns only if the costs are not so high.

 

 

 

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