Tata AIA i Systematic Insurance Plan

What is Tata AIA i Systematic Insurance Plan?

The Tata AIA iSystematic Insurance Plan (iSIP) is a investment plan that also helps you grow your money. It combines life cover with the chance to invest in the market. This is a non-participating, unit-linked plan, meaning returns depend on how the market performs. The policyholder bears the investment risk. iSIP is designed to help you achieve your financial goals while protecting your loved ones.

Features of Tata AIA i Systematic Insurance Plan

The following list highlights the key features of the Tata AIA i Systematic Insurance Plan:

• Plan Options: 
  • iSIP Wealth: This option provides market-linked returns, a premium waiver, and tax benefits.
  • iSIP Young Genius: This child plan secures your child’s future by ensuring policy continuity and covering future premiums if the life assured is no longer around.
• Cost Benefits: You can save money on premium allocation and policy charges, which helps increase your returns.
• Fund Additions: You will receive extra units, a return of mortality charges, and special allocation for female policyholders in the first year.
• Other Benefits: The plan allows you to make partial withdrawals, enjoy wellness benefits, and benefit from tax savings.

Eligibility Criteria for Tata AIA i Systematic Insurance Plan

*SA: Sum Assured

Benefits of Tata AIA i Systematic Insurance Plan

• Maturity Benefit: The Fund Value, including any Top-Up Premium Fund Value, will be paid based on the applicable NAV on the maturity date. If the Life Insured is alive, the amount is paid to the policyholder; otherwise, it goes to the nominee.
• Death Benefit: The nominee receives the highest of the Basic Sum Assured, the Fund Value, or 105% of total premiums paid. If there is a Top-Up Fund Value, the highest of the approved Top-Up Sum Assured is also payable. For iSIP Young Genius, future premiums are funded by TATA AIA Life, and the policy continues with Fund Value invested.
• Juvenile Provisions: If the insured is below 18 years, the policyholder retains all rights until the insured turns 18. Risk cover starts immediately, and any benefits before 18 are paid to the policyholder.
• Return of Mortality Charges (ROMC): Starting from the 11th policy year, the mortality charges deducted 120 months earlier will be added back to the Fund Value as units each month. On maturity, the total mortality charges deducted (excluding underwriting extras and taxes) will be refunded, provided all premiums are paid. If the policy term is less than 11 years, all mortality charges will be returned at maturity.
• Smart Lady Benefit: Female policyholders receive an additional allocation of 0.50% of the Annualised Premium or 0.25% of the Single Premium, added to the Fund Value in the first year.
• Wealth Boosters: Every five years, starting from the 10th policy year, a percentage of the average Fund Value (including Top-Up Fund Value) of the last eight quarters is added as units. This benefit is guaranteed if the policy remains active with all due premiums paid.
• Partial Withdrawal Benefit: After five policy years, partial withdrawals can be made from the Regular/Single Premium Fund. Withdrawals are first made from the Top-Up Fund (if applicable). The minimum withdrawal is ₹1,000, and the maximum is 25% of the Fund Value per year. Withdrawals are allowed only after the insured turns 18, with no charges. The policy must remain active, and withdrawals cannot terminate the contract.
• Systematic Withdrawal Plan (SWP): Allows withdrawals at fixed intervals, based on a chosen percentage (1%-15%) or a fixed amount. Payouts can be monthly, quarterly, half-yearly, or annually. The option can be selected at inception or anytime later and modified with 30 days’ notice before the policy anniversary.
• Chosen-rate Withdrawal Plan (CWP): Withdrawals occur if the fund’s actual value exceeds the chosen rate of return. If the actual value is lower, no withdrawal happens. The rate of return can vary for different funds. SWP and CWP cannot be chosen together.
• Index-based Withdrawal Plan (IWP): Works like CWP but is linked to an external index (e.g., CAGR, 10-year G-Sec rate, SBI savings rate, etc.). If the fund’s performance exceeds the index, the positive difference is paid out. The chosen index can be changed with 30 days’ notice before the policy anniversary.
• Investment Flexibility: This product allows you to invest based on your risk profile and financial goals. You can either choose from 24 investment fund options or from the two portfolio strategies, which are Enhanced Systematic Money Allocation & Regular Transfer (Enhanced SMART) and Life-stage Based Portfolio Strategy – Adjusts investments based on your age and financial goals.
• Discontinued Policy Fund: The Discontinued Policy Fund is designed to provide capital protection with a minimum return as per regulatory requirements. It primarily invests in high-quality short-term debt securities with a very low risk profile. The fund offers a guaranteed interest rate of 4% p.a. or as prescribed by IRDAI, ensuring liquidity and safety.
• Top-up Facility: You can pay additional premiums as Top-up Premiums anytime during the policy term, except in the last five years. The minimum top-up amount is ₹100. These premiums are subject to charges and have a five-year lock-in period from approval. Top-up premiums can be allocated in any proportion across available funds.
• Switching Between Funds: You can switch investments between funds as per market outlook, with no additional cost, except when Enhanced SMART or Life-Stage based strategies are chosen. Switching is allowed any number of times per year, and requests must specify the funds to be redeemed and allocated.
• Premium Re-direction: The Premium Re-direction facility allows you to allocate future premiums to different funds without any charges. This option is not available if Enhanced SMART is chosen.
• Settlement Option: On maturity, you can choose to receive your Maturity Benefit either as a lump sum or as periodical payments over a five-year period. Life cover continues at 105% of total premiums paid, and switches are allowed during this period, but partial withdrawals are not. Investment risk remains with you during the settlement.

Riders Available with Tata AIA i Systematic Insurance Plan

• Following is the list of premium-paying riders where no fund units are deducted: 
  • Tata AIA Life Linked Comprehensive Health Rider
  • Tata AIA Life Linked Comprehensive Protection Rider
  • Tata AIA Vitality Health Plus
  • Tata AIA Vitality Protect Plus
  • Tata AIA Sampoorna Health
• The following unit-deducting riders are available with the Tata AIA i Systematic Insurance Plan:
  • Tata AIA Life Insurance Waiver of Premium (Linked) Rider.
  • Tata AIA Life Insurance Waiver of Premium Plus (Linked) Rider - Not allowed to be attached under Option 2.
  • Tata AIA Life Insurance Accidental Death and Dismemberment (Long Scale) (ADDL) Linked Rider.
  • TATA AIA OPD Care.

NOTES: These unit-deducting riders can be attached either at inception or any policy anniversary, subject to the following conditions:

• The policy term of Waiver of Premium Rider and Waiver of Premium Plus Rider should not be more than the outstanding premium paying term of the base policy.
• The policy term of Accidental Death and Dismemberment Rider should not be more than the outstanding policy term of the base policy.

Portfolio Management Strategies of Tata AIA i Systematic Insurance Plan

You can choose between two portfolio strategies for optimal asset allocation:

1. Enhanced Systematic Money Allocation & Regular Transfer (Enhanced SMART):

   A systematic transfer plan where premiums are initially invested in a debt-oriented fund and then transferred to an equity fund monthly, offering rupee cost averaging. This option is free, available for annual/single premium policies, and can be stopped anytime by written request.

2. Life-Stage Based Strategy:

   Adjusts your fund allocation from equity to debt based on your age and risk profile (Conservative, Moderate, Aggressive). This option automatically shifts your investments as you age, and it can be opted out anytime with prior notice, but manual switching is not allowed.

Policy Details of Tata AIA i Systematic Insurance Plan

• Segregated Discontinued Policy Fund: The Discontinued Policy Fund is a segregated unit fund with fund management charges. Currently, these charges do not exceed 50 basis points per annum, as declared by the Authority.
• Minimum Guaranteed Interest Rate: The minimum guaranteed interest rate on the discontinued fund is 4% per annum, as declared by the Authority. Any income exceeding this rate is apportioned to the fund but not available to shareholders.
• Surrender Value: If the policy has acquired a surrender value within the first five years, the value is payable only after the completion of the lock-in period.
• Revival of Discontinued Policy: Upon revival after the lock-in period, the policy is restored to its original terms, including risk cover, benefits, and charges. All due premiums are collected without interest or additional fees.
• Surrender Benefit & Terms: Within the lock-in period: The surrender value (fund value minus discontinuance charges) is credited to the Discontinued Policy Fund, and proceeds are paid after the lock-in period with a minimum interest guarantee of 4% p.a.
• After the lock-in period: The total fund value is paid on complete withdrawal.
• Lock-in period: The period of five consecutive years from policy commencement, during which proceeds are not payable, except in cases of death or other covered contingencies.
• Free Look Period: If you are dissatisfied with the policy terms, you can cancel it within 30 days from receiving the policy document. You’ll receive the non-allocated premium, minus certain charges, such as extra premium allocation, risk premium, medical costs, stamp duty, and GST.
• Grace Period: If you miss a premium, you get a 30-day grace period for annual, semi-annual, or quarterly modes and 15 days for monthly mode. The policy remains in force with risk coverage during this period.
• Health Management Services: Eligible policyholders can access health management services, such as second opinions, medical case management, and consultations from service providers registered with Tata AIA Investment Plan.
• Loyalty Program Reward: Members of the loyalty program can earn rewards based on their premium payment. The rewards, like points or coins, are given in the first policy year, with details provided on the company's website.
• Backdating: Backdating is not permitted in this plan.
• Policy Loan: Policy loan is not available under this plan.

How Does the Tata AIA i Systematic Insurance Plan Work?

You can invest and protect yourself by investing in this ULIP plan by following these 3 simple steps:

• Step 1: Select one of two available plan options.
• Step 2: Choose the investment term and duration to pay premiums.
• Step 3: Decide the premium amount and your preferred investment strategy.

Suicide Exclusion Criteria of Tata AIA i Systematic Insurance Plan

In case of suicide within 12 months from the commencement or revival date of the policy, the nominee will receive the fund value as on the date of death intimation. Any charges, except Fund Management Charges (FMC), recovered after death will be added back to the fund value. If the life assured commits suicide within 12 months of a sum assured increase, the increase amount will not be included in the death benefit calculation.