Prduct Circular A Traditinal Grup Term Insurance Plan UIN: 116N021V03 Nn-Linked, Nn-Participating, Yearly Renewable Grup Term Insurance Plan FOR INTERNAL CIRCULATION ONLY Department: Prduct Develpment Launch Date: 26/ 04/ 2004 Mdificatin Date: 11/ 08/ 2015 Versin: 8 This dcument is meant fr internal circulatin and is nt a sales literature/material which can be used fr the purpses f slicitatin.
TABLE OF CONTENTS 1. PURPOSE AND SCOPE... 2 2. PRODUCT TYPE... 2 3. POLICY CONTRACT... 2 4. GROUPS... 2 5. JOINT LIFE AVAILABILITY... 2 6. PLAN WORKING... 2 7. ELIGIBILITY AND LIMITS... 3 8. MATURITY BENEFIT... 3 9. DEATH BENEFIT... 3 10. SURRENDER... 4 11. ADDITIONAL RIDER BENEFIT... 4 12. OPTION TO CHOOSE PREMIUM PAYMENT FREQUENCY... 4 13. POLICY LOAN... 4 14. FREE COVER LIMIT... 4 15. PROFIT SHARING... 5 16. REBATE... 5 17. REMUNERATION/ FEE... 6 18. JOINT LIFE DISCOUNT... 6 19. NON-PAYMENT OF PREMIUMS... 6 20. GRACE PERIOD... 6 21. REVIVAL... 6 22. TERMINATION OF THE POLICY... 7 23. TAX BENEFITS... 7 24. SUICIDE CLAIM PROVISIONS... 7 25. FREE LOOK PERIOD... 7 26. NEW ENTRANTS AND LEAVERS... 8 27. NOMINATION... 8 28. NON-DISCLOSURE & FRAUD... 8 29. DEFINITIONS... 8 1
1. PURPOSE AND SCOPE is a grup term insurance plan that gives members the cmplete reassurance f a lasting financial security and peace f mind. 2. PRODUCT TYPE is intended t prvide death cver t members f all Emplyer Emplyee grups and als, Nn Emplyer Emplyee grups. The benefits under this plan are payable t the nminee. The individual members will have the facility f nminating the persn t whm the plicy prceeds will be paid by the Cmpany. 3. POLICY CONTRACT The basis f the cntract will be the Prpsal Frm alng with membership data filled by the Prpser. The plicy dcument/certificate f insurance will be the evidence f the cntract. 4. GROUPS This plan cvers members f Emplyer Emplyee grups and Nn Emplyer Emplyee grups. 5. JOINT LIFE AVAILABILITY Jint life is available fr spuse nly. 6. PLAN WORKING This Grup Scheme prvides basic life insurance prtectin t the members. All members f the scheme will be cvered under a single plicy that will be issued t the Master Plicyhlder. The sum assured fr each individual member shall be as prpsed by the plicyhlder having reference t sme justifiable factr and as agreed by the Cmpany. The cverage selected may be: Unifrm cver: same fr all members f the grup Graded cver: n the basis f Rank Salary levels Cst t cmpany Outstanding lan Liability amunt Size f bank depsit Future Service Gratuity f Gratuity Scheme Life Cver in lieu f Emplyee Depsit Linked Insurance (EDLI) scheme, 1976 # Any ther means #All emplyees t whm the Emplyee s Prvident Fund and Miscellaneus Prvisin Act,1952 applies, have a Statutry liability t subscribe t Emplyee s Depsit Linked Insurance Scheme, 1976 t prvide fr the benefit f Life insurance t all their emplyees The member will have the ptin t chse the disbursement f death benefit as lump sum r partly as lump sum and the remaining spread ver the chsen perid paid in equal instalments. On death f the member the sum assured shall be paid as per the chsen ptin. Under jint life cver, self and spuse will be cvered and the death benefit will be paid in case f first death f either f the members. 2
The scheme may be eligible fr prfit sharing based n experience rating, minimum number f life years cvered under the plicy and quted premium, if the plicyhlder has pted s in the plicy, in the frm f a reductin in subsequent year s renewal premium. The scheme can be cntributry r nn-cntributry, i.e., members and/r emplyer shall cntribute t the premium payable with respect t the members & spuses. In case the member pays the premium, the member cver shall be prvided fr ne year frm the date f cmmencement f risk f the member else the premium shall be charged prprtinately frm the date f cmmencement f risk f the member up t the next plicy anniversary. This is a ne-year renewable cntract and at the time f cntract renewal, the insurer may renew r decline t renew the cntract in accrdance with Bard apprved underwriting nrms. The premium and ther terms and cnditins will be reviewable yearly. Jint Life will be allwed nly fr spuse. 7. ELIGIBILITY AND LIMITS Parameter Minimum Age at Entry Maximum Age at Entry Maximum Age at Maturity Plicy Term Premium Minimum Sum Assured Maximum Sum Assured Minimum Grup Size Details Attained age f 14 years fr bth Emplyer Emplyee grups (EE) & Nn Emplyer Emplyee grups (NEE) In case f jint life, the yunger life shuld have attained the minimum entry age In case f Grup Term Life in lieu f EDLI, member will be cvered as lng as he/ she is the member f Prvident Fund Attained age f 79 years fr EE (prvided member is in active service n date f entry) and attained age f 69 years fr NEE In case f jint life, the lder life s entry age shuld nt exceed the maximum entry age In case f Grup Term Life in lieu f EDLI, member will be cvered as lng as he/she is the member f Prvident Fund Attained age f 80 years fr EE and attained age f 70 years fr NEE In case f jint life, the lder life s age shuld nt exceed the maximum maturity age One Year Renewable Grup Term Assurance As per chsen Sum Assured Rs. 1,000 per member N limit, subject t underwriting 10 members fr EE grup 50 members fr NEE grup 8. MATURITY BENEFIT There is n maturity benefit under this plan. 9. DEATH BENEFIT The members can pt frm the tw available ptins t receive the death benefit. The ptin has t be chsen by the members at inceptin r at any membership anniversary. In case n ptin is chsen, the default ptin will be Optin I. Optin I On death f the member In case f jint life n first death f either f the member Sum Assured as lump-sum will be paid 3
Optin II On death f the member In case f jint life n first death f either f the member X% f Sum Assured as lump-sum will be paid The balance amunt, i.e., (1-X%) f Sum Assured, will be paid in equal installments in arrears, spread ver the installment perid chsen by members, subject t a maximum f 10 years, where, X shuld at least be 10 Installment amunt = [(1 X%) * Sum Assured/ Installment Perid] * Installment Factr Installment Perid (in years) 1 2 3 4 5 6 7 8 9 10 Installment Factr 1.04 1.06 1.08 1.10 1.12 1.14 1.16 1.18 1.21 1.23 The installment factrs will be reviewed frm time t time, subject t the apprval f IRDAI. The installment amunt fr frequencies ther than annual is given by the annual installment multiplied with the frequency factr. The factrs are: Installment frequency Mnthly Quarterly Half yearly Frequency factr 0.08 0.242 0.49 Under Optin II, the mde f installment payment, the term f installment payment and the amunt f lumpsum payment can be decided by the member at inceptin r at any membership anniversary. 10. SURRENDER There is n surrender benefit under this plan. 11. ADDITIONAL RIDER BENEFIT The plicyhlder can pt fr extra cverage by chsing the ptinal additinal rider benefits at a nminal extra cst. The riders available with are: 1. Bajaj Allianz Grup Accidental Death Benefit Rider UIN: 116B005V03 2. Bajaj Allianz Grup Accidental Permanent Ttal/ Partial Disability Benefit Rider: UIN: 116B010V02 3. Bajaj Allianz Grup Accelerated Critical Illness Benefit Rider UIN: 116B026V02 Refer t respective rider sales literature r visit Cmpany website fr mre details and eligibility cnditins. 12. OPTION TO CHOOSE PREMIUM PAYMENT FREQUENCY The premium may be paid in yearly, half yearly, quarterly r mnthly frequency. The premium fr frequencies ther than annual is arrived at by multiplying the annual premium with the frequency factrs, given belw: Premium Payment Frequency Mnthly Quarterly Half yearly Frequency Factr 0.09 0.26 0.51 13. POLICY LOAN There is n plicy lan under this plan. 14. FREE COVER LIMIT Eligible members in EE grup insurance scheme will be accepted up t the Free Cver Limit as given in the table belw, abve which the acceptance will be subject t prevailing apprved underwriting guidelines. 4
Number f Lives Free Cver Limit Up t 50 2.5 x Average Sum Assured, max Rs. 10,00,000 51 100 3 x Average Sum Assured, max Rs. 20,00,000 101 200 4 x Average Sum Assured, max Rs. 30,00,000 201 500 5 x Average Sum Assured, max Rs. 35,00,000 501 1000 6 x Average Sum Assured, max Rs. 40,00,000 1000 2000 7 x Average Sum Assured, max Rs. 45,00,000 Over 2000 8 x Average Sum Assured, max Rs. 50,00,000 Average Sum Assured is equal t the ttal sum assured fr the grup divided by the number f members cvered. Fr NEE grup schemes, the nn-medical limit will be as per the prevailing apprved underwriting nrms f the Cmpany. 15. PROFIT SHARING The plicyhlder will have the ptin f sharing in the mrtality prfits (prfit sharing) based n the experience rating, subject t the fllwing cnditins: i) Under a Grup Master Plicy, the cmputatin f Prfit Share will be dne n cmpletin f minimum ii) iii) iv) life years f 1000. The prfit sharing fr the grup will be applied in reducing the premium payable n the next renewal date. If the premium in part/ whle is paid by the members then the reductin will be shared by the plicyhlder & members in the same prprtin. In case f lsses, the same will be carried frward and will be adjusted in subsequent years prfits. Mrtality assumptin fr the purpse f prfit sharing shall nt be lwer than 60% f the adjusted Indian Assured Lives Mrtality (2006-08) Ult. v) The frmula t arrive at the Prfit Share f the grup is: Prfit Share = (P) * [(Premium Expenses Cmmissin) Actual Claims (AC)], where, P = Percentage f prfit sharing, where, P <= 75%, if number f life years cvered is less than 1 lac where, 75%< P <= 90%, if number f life years cvered is greater than r equal t 1 lac Premium = Ttal premium cllected excluding any extra premium and/r rider premium less Reinsurance premium paid. AC = Actual Claims during the perid Actual Claims = (Claims intimated + Prvisin fr IBNR at end Prvisin fr IBNR at beginning Reinsurance Claim refunds). Prfit sharing will be applicable nly where the quted premium is at r abve 60% mrtality. The discunts/ladings, if any, shall nt exceed 30% f the premium rates. 16. REBATE Rebate n premium rates will be applicable if cap f Rs. 50,000 n cmmissin payable becmes applicable fr a grup scheme. 5
In case f excess cmmissin cllected where the ttal cmmissin at 2% exceeds Rs. 50,000, the belw discunt table will be used. Ttal Premium inclusive f premium under the base plicy Discunt as % f Ttal Premium Rs. 25,00,001-30,00,000 0.05% Rs. 30,00,001 40,00,000 0.30% Rs. 40,00,001 50,00,000 0.75% Rs. 50,00,001 75,00,000 1.00% Rs. 75,00,001 1,00,00,000 1.30% Rs. 1,00,00,001 3,00,00,000 1.50% Rs. 3,00,00,001 5,00,00,000 1.80% > Rs. 5,00,00,001 1.90% In case f Direct Marketing where cmmissin is nt paid, the difference will be passed t the plicyhlder as a rebate t the premium calculated. The rebate will be P * 2% where P is the calculated premium. 17. REMUNERATION/ FEE The grup plicyhlder may be eligible fr remuneratin/fee as given belw: a) Data Management: Rs. 15 per member per annum b) Premium Cllectin: Rs. 10 per member per annum c) Issuance and Delivery f certificate f Insurance: Rs. 10 per member subject t a minimum f Rs. 500 d) Claims settlement: Rs. 10 per claim 18. JOINT LIFE DISCOUNT Jint life premium rates (fr lives aged x and y) will be 90% f the sum f the individual premium rates fr lives aged x and y. 19. NON-PAYMENT OF PREMIUMS In case f nn-payment f due premiums in respect f the member (including jint life cver, if pted) under the plicy befre the expiry f the grace perid, the life insurance cver n the life f the member (including jint life cver, if pted) shall cease effective frm the due date f first unpaid premium. The life insurance cver during the grace perid shall be prvided nly if the plicy is renewed befre the expiry f the grace perid. In case death ccurs in such a situatin during the grace perid, the sum assured shall be paid, subject t deductin f due but unpaid premium/s. 20. GRACE PERIOD If the plicyhlder has failed t make payment f the premium by the due date specified, a grace perid f 30 days fr premium payment frequencies ther than mnthly and 15 days fr mnthly frequency is allwed. If the death f the member ccurs during the grace perid, the death benefit payable under the plicy shall be Sum Assured after deductin f the due unpaid premiums. 21. REVIVAL The plicy may be renewed n cmpletin f ne year n the Annual Renewal Date. The renewed premium rates and the terms may r may nt be different frm that in the previus year. Membership under a NEE scheme can be renewed subject t renewal f plicy. 6
If premium payment frequency is ther than yearly, n nn-payment f premium/s due within the grace perid, the plicy/ membership can be revived within the ne-year term f the plicy/ membership by: paying all the premiums due submitting all the dcuments & infrmatin required by the Cmpany The plicy/ membership may be revived at the riginal/revised term & cnditins as specified by the Cmpany. 22. TERMINATION OF THE POLICY The life insurance cver including additinal rider benefit cver if any, fr a member will terminate n ccurrence f any ne f the fllwing: a) n the date f terminatin f plicy by the plicyhlder b) at the end f the grace perid, r n nn-payment f premium fr the member befre the expiry f the grace perid during the plicy term c) the date n which the primary member r, in case f jint life cver, the first f primary member and the spuse cmpletes the age f 70 years fr NEE Scheme Or NRA (Nrmal Retirement Age), as applicable and 80 years fr EE scheme d) n death f the primary member r, in case f jint life cver, n first death f the primary member and the spuse, after the death benefit is paid e) n payment f critical illness benefit, if pted by the member (including jint life cver, if pted) under Bajaj Allianz Grup Accelerated Critical Illness Rider Benefit (UIN 116B026V02) if pted. 23. TAX BENEFITS As per applicable tax laws. 24. SUICIDE CLAIM PROVISIONS Under the NEE scheme where membership is nt cmpulsry fr all the members f the grup, then, in case a member (including jint life cver, if pted) cmmits suicide within ne year frm the date f entry/cmmencement f membership, the cntract f insurance with the member (including jint life cver, if pted) shall be terminated by paying 80% f the premium paid with respect t that member (including jint life cver, if pted) as n the date f death. Such exclusin is nt applicable fr all EE schemes and fr NEE schemes where membership under the plicy is cmpulsry fr all. The validity f the cntract f insurance shall be determined in accrdance with actual date f death and nt date f intimatin f death. 25. FREE LOOK PERIOD Within 15 days [30 days in case the plicy is issued under the prvisins f IRDAI Guidelines n Distance Marketing f Insurance Prducts**] frm the date f receipt f the plicy, the plicyhlder has the ptin t review the terms and cnditins f the plicy and if the plicyhlder disagrees t any f the terms & cnditins, he has an ptin t return the plicy stating the reasns fr his bjectins. The plicyhlder shall be entitled t a refund f the cntributin paid, subject t deductin f the stamp duty expenses, the prprtinate premium, if any, fr the perid the members where n cver, the expenses incurred n medical expenses, if any. **Distance marketing is dne thrugh website and tele calling. 7
26. NEW ENTRANTS AND LEAVERS At the cmmencement, and thereafter n each annual renewal date, the plicyhlder will have t send all the members data t the respective unit f Bajaj Allianz Life Insurance Cmpany. New Member additins frm a well-defined date shall be in accrdance with the prcess as mentined in the scheme rules and agreed t by the Cmpany. All new eligible members are t be cmpulsrily cvered, if they meet the eligibility criteria. If any member enters the scheme between tw annual renewal dates, the particulars f the same shuld be submitted n a mnthly basis alng with the prprtinate premium fr the balance part f the plicy year. If any member leaves the scheme between tw annual renewal dates, the particulars f the same shuld be submitted n a mnthly basis. The membership register as per the annexure t prpsal frm has t be updated by the plicyhlder fr all additins and deletins and intimated t the Cmpany. The updated data thrugh CD r mail fr updating in the Cmpany s recrds. 27. NOMINATION Nminatin shuld be in accrdance with prvisins f sectin 39 f the Insurance Act 1938 as amended frm time t time. 28. NON-DISCLOSURE & FRAUD Fraud, Misrepresentatin and frfeiture wuld be dealt with in accrdance with prvisins f sectin 45 f the Insurance Act 1938 as amended frm time t time. 29. DEFINITIONS Annual Renewal Date: The date crrespnding numerically with the plicy cmmencement date each subsequent year. Certificate f Insurance: This is the certificate issued by the Cmpany n the basis f the details mentined in the member s enrlment frm t each Member as an evidence f acceptance f risk n the life f the member under the plicy. Member: means the primary member and the spuse f the primary member (in case f jint life cver) whse name/s has been recrded in the Membership Register as a member frm a well-defined date, i.e. the entry date after due apprval frm the Cmpany and n whse life the life insurance cver under this plicy has been effected. Plicyhlder: the persn r entity wh has entered int a cntract with the Cmpany. Sum Assured: the amunt as recrded in the Membership Register and as mentined in the Certificate f Insurance, representing the amunt f the Life Insurance Cver prvided t the Member/s and based n which the Premium is calculated. 8