LIC’s Samridhi Plus is a unit-linked insurance plan which aims at giving you the benefit of the upside movement of the market, as well as preserving your capital. Launched on 25^th February 2011, this plan guarantees you the payment of fund value at the end of the term, based on the highest NAV over the first 100 months of the policy, or the NAV as on the date of maturity whichever is higher, with a minimum NAV of Rs.10/-. This plan is available for sale for a maximum period of 3 months from the date of launch.

FEATURES:

• The term of the policy is 10 years and the premium paying term is 5 years.
• The payment at the end of the policy term will be based on highest NAV over the first 100 months of the policy, or the NAV as on the date of maturity, whichever is higher.
• Your fund will be invested in money market instruments on the onset. After the fund closes, your funds will be shifted to a dynamic allocation fund called the ‘Samridhi Plus Fund’, which is a medium risk fund and involves allocation into debt, equity and money market instruments.

ELIGIBILITY:

· Age at entry: 8 to 65 years

· Premium:

Sum assured

For single premium the maximum sum assured is 4*AP if age of entry is up to 55 years and 1.25*AP if age of entry is from 56 to 65 years.

CHARGES:

Premium Allocation Charge:

For Single premium policies:             3.3%

         
For Regular premium policies:  

• Policy Administration Charge: Rs.30 per month during the first policy year and escalating at 3% p.a. thereafter, throughout the term of the policy.
• Fund Management Charge: 0.90% p.a. of Fund Value. This is a charge levied at the time of computation of NAV, which will be done on daily basis.
• Guarantee Charge: A charge of 0.40% p.a. of the Fund Value shall be levied for the cost of investment guarantee.
• Miscellaneous Charge: This is a charge levied for an alteration, such as change in premium mode and grant of Accident Benefit after the issue of the policy. A charge of Rs.50 can be levied.

RIDERS:

• Accident benefit option can be availed if you are between 18 and 60 years of age. You can get a life cover of a minimum of Rs.25000 and a maximum of Rs.50 lakh and this will be paid along with the sum assured in case death occurs due to accident.

INVESTMENT MODES:

• You can pay the premium in yearly, half-yearly, quarterly or monthly mode. Payment through monthly mode can be made by ECS only.
• You can pay in lump sum also under the ‘single premium’ mode.

RETURNS

• Maturity benefit: Fund value will be payable at maturity. The fund value at the end of policy term is based on the highest Net Asset Value (NAV), over the first 100 months of the policy or the NAV as on the date of maturity, whichever is higher.
• Death benefit: The sum assured or fund value, whichever is higher, will be paid to the nominee.

WITHDRAWAL:

Partial withdrawals are allowed after completion of 5 policy years. You can withdraw a minimum amount of Rs.2000, twice a year.

LOANS FACILITY:

No loans are available under this policy.

SURRENDER:

• If you surrender within 5 years of policy term, a discontinuance charge will be applicable and you will get the fund value after the completion of 5 years.
• If you apply for surrender after completion of 5 years, you will get the full fund value on surrender.

REVIVAL: If all due premiums are not paid within the grace period of 15 days, then LIC will send you a notice. In case you wish to revive your policy, you will have to pay all arrears of premiums without interest.

REVIEW OF THE POLICY:

• Buying this policy is a good idea if you are looking at twin benefits of capital protection as well as growth. The ‘guaranteed’ feature makes this policy a good choice for conservative investors who want to limit their risk to the ‘medium’ category.
• Another positive point about this policy is that you can make a lump sum investment by paying a one time premium (single premium). Therefore, this policy is suitable for those investors who want to make one time bulk investments and also for those with irregular income structure. Apart from this, the charges for paying in lump sum are much lower than the charges levied for regular pay. So this policy should be attractive enough for one time investors.
• Revival is also easier under this policy. No additional documentation and medical tests are required for revival. There are policies in the market which can be revived only after a tedious documentation processes and a medical test, in case you are opting for revival after six months or more, of missed premiums.
• No top-up is allowed under this policy. So at any point of time, you will not be able to make additional investments in to this policy. Additionally, you do not have an option of increasing or decreasing your risk cover. However there are plan in the market which give you an option of alteration in risk covers.
• The plan could have provided more riders in addition to the one it is already providing. Accidental Disability rider is the one widely known to be provided across policies. So, in terms of protection, the policy could have done much better.
• Also the overall cost structure depicts that the charges are on the higher side as compared to the other products in the market where the charges start falling drastically 5^th year onwards.
• Another fact that you will have to be cautious about is the feature of the guarantee of highest NAV. This is more or less a misleading term. Under such schemes, your money is invested in the equity markets in the beginning and the highest NAV is locked. After the first 100 months are over, your money keeps moving to the debt portfolio in an attempt to preserve the capital and keep the NAV close to the highest NAV. Your money is never shifted back to equity to gain from any further rise in the market. So it is sensible for investors looking at capital preservation to buy this policy. It would be more beneficial for aggressive investors and young investors to go in for other products which provide with a higher exposure to equity so as to maximise returns.

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