HDFC Life Guaranteed Savings Plan. An Individual, Non-Linked, and Non-Participating Savings Life Insurance Plan.

 

HDFC Life offers the Guaranteed Savings Plan, an accessible savings option that combines life insurance coverage with financial security.    A key benefit is hassle-free issuance via a Declaration of Good Health, eliminating the need for a medical exam. The plan guarantees a maturity value if all premiums are paid. Life coverage includes death benefits of either 1.25 times or 10 times the single premium for single-pay policies, or 10 times the annualized premium for limited-pay policies.    The plan also allows flexible premium payment options and potential tax benefits under sections 80C and 10(10D), making it a great choice for securing your financial future.

Eligibility criteria:

**Age at Entry (last birthday):**   **Minimum:** 8 years (policy vests at age 18 for minors).   **Maximum:** Single Pay - 45 years; Limited Pay - 55 years.   Risk coverage begins on the policy commencement date for all lives.

Age at maturity (last birthday): Minimum age is 18 years. The maximum age is 55 years for Single Pay and 65 years for Limited Pay.

Premium Payment Terms (PPT): Single Pay & Limited Pay options are available for 5, 6, 7, 8, 9, 10, and 12 years.

Maximum Sum Assured on Death: Rs. 25,00,000

**Policy Term (PT):**   - **Single Pay:** 5, 7, 10, 15 years.   - **Limited Pay:**     - PPT 5, 6, 7: PT 10, 12, 15, 20 years.     - PPT 8, 9, 10: PT 12, 15, 20 years.     - PPT 12: PT 15, 20 years.

PREMIUMS: Select your premium as needed: - Minimum: Rs. 5,000 - Maximum: Rs. 2,50,000

BENEFITS:

Maturity Benefit:   If you survive the Policy Term and all premiums are paid, you will receive a lump sum 'Sum Assured on Maturity' based on the Premium Payment Term, frequency, and amount. Upon receiving this benefit, the Policy will terminate, and all other benefits will cease.

**Death Benefit:**   A 90-day waiting period applies for Death Benefits, except in cases of accidental death. Accidental Death is defined as death resulting from a bodily injury caused by an unforeseen accident, independent of other causes, occurring within 180 days of the injury. The Death Benefit will be paid as a lump sum, provided that all premiums are current as of the date of death.

Death benefits during the waiting period: In case of Accidental Death: Sum Assured on Death, which is the highest of: 1.25 times or 10 times the Single Premium for Single Pay policies (as  chosen by the policyholder at inception) / 10 times the Annualized Premium for Limited Pay policies.  105% of Total Premiums paid.  Sum Assured on Maturity.  Any absolute amount assured to be paid on death, which is equal to the Sum Assured on maturity. In case of Death due to other causes: 100% of Total Premiums paid.

**Death Benefits After the Waiting Period:** Applicable to all causes of death. **Sum Assured on Death:** The highest of: 1. 1.25 times or 10 times the Single Premium for Single Pay policies (as chosen) / 10 times the Annualised Premium for Limited Pay policies. 2. 105% of Total Premiums paid. 3. Sum Assured on Maturity. 4. Any guaranteed amount equivalent to the Sum Assured on Maturity.

Note: Upon payment of the Death Benefit, the Policy will terminate, and no further benefits will be payable.

### Consequences of Non-Payment of Premiums:   **A. Lapse:** Your policy lapses if due premiums remain unpaid after the Grace Period and you have not acquired a Surrender Value. No benefits are payable. You can revive a lapsed policy within 5 years from the first unpaid premium date, as per the policy’s terms.    **B. Paid-up:** If the policy has a Surrender Value but premiums are unpaid, it becomes paid-up with reduced benefits after the Grace Period. The death benefit will equal the Paid-up Sum Assured on Death (Sum Assured on Death × t/n), and the maturity benefit will be based on the Paid-up Sum Assured on Maturity (Sum Assured on Maturity × t/n), where: - **t** = premiums paid until it becomes paid-up, - **n** = total premiums payable.   The minimum death benefit for a reduced paid-up policy is at least 105% of total premiums paid until death.   **C. Surrender:** You may surrender the policy at any time during the term. The Surrender benefit will be the higher of the Guaranteed Surrender Value (GSV) and Special Surrender Value (SSV).    - **GSV**: Acquired after paying all due premiums for at least the first two policy years for limited-pay policies, or upon payment of the single premium for single-pay policies. GSV is calculated using applicable factors and total premiums paid.   - **SSV**: Payable after the first policy year, or immediately after a single premium is paid. It represents the present value of the paid-up sum assured and future benefits.   Upon surrender, the policy terminates, and no further benefits are payable.

**LIQUIDITY THROUGH POLICY LOANS:**   Policy loans are available during the Policy Term, subject to the following terms:   - Loan amount is a maximum of 80% of the Surrender Value. - Current interest rate is 9.5% p.a., calculated as the Average Annualised 10-year benchmark G-Sec Yield (last 6 months, rounded to nearest 50 bps) + 2%. This rate is reviewed biannually on February 25 and August 25. - If the interest rate changes, it will remain effective until the next review. The source of the G-sec yield is the RBI Negotiated Dealing System-Order Matching (NDS-OM) segment. - Loan outstanding and interest will be deducted from any Benefits before payout. - An in-force or fully Paid-up policy will not be foreclosed for non-repayment of the loan.

**Indirect & Direct Taxes:**  **Indirect Taxes:** Applicable taxes and levies may be imposed. Future taxes may require an additional charge beyond premiums.   **Direct Taxes:** Tax will be deducted from policy payments at the current rate as per the Income Tax Act, 1961, and its amendments.

Terms and conditions:

**A) Exclusions:**   **Suicide Exclusion:**  If death occurs due to suicide within 12 months from the policy start date or revival, the beneficiary is entitled to at least 80% of premiums paid or the available surrender value, whichever is higher, provided the policy is active.   B. **Waiting Period Conditions:**  During the 90-day waiting period, if death occurs from causes other than accidents, premiums paid will be refunded. For accidental death claims during this period, only premiums will be refunded if the cause is related to: - Influence of drugs, alcohol, or substances not taken under a doctor’s prescription. - Intentional self-inflicted injuries or attempted suicide. - Deliberate exposure to danger (except to save a life). - Violation of law, resistance to arrest, or participation in criminal activities.

C. **Grace Period:** The grace period does not apply to single premiums. A 15-day grace period is available for monthly payments, and 30 days for quarterly, half-yearly, or annual payments to settle the premium. Part payments are not accepted. The policy remains in force with risk coverage during the grace period. If death occurs during this period, any unpaid premiums will be deducted from the Death Benefit.

D. **Policy Revival:** If your Policy is discontinued due to non-payment, it can be revived with all benefits upon payment of due premiums and any late fees, provided you meet insurability requirements. You must apply for revival within five years from the first unpaid premium and before the policy term expires. The revival interest rate is currently 9.5% p.a., subject to change based on the average 10-year benchmark G-Sec Yield plus 2%. During revival campaigns, reduced interest rates may be offered, varying annually. After revival, all contractual benefits will apply.

E) Tax Benefits:   Consult your tax advisor for potential tax benefits under current laws.

F) Cancellation in the Free-Look Period:   If the Policyholder disagrees with any provision of the Policy, they may return it to the Company within 30 days of receipt, stating their reasons. Upon receipt of the letter and the original Policy document (not required for dematerialized or electronic policies), the Company will refund the Premium paid, less the proportionate Risk Premium for the coverage period and any medical exam or stamp duty charges incurred.

**G) Grievance Redressal System:**   For any concerns, you may contact as given below:  - **Helpline:** 022-68446530 (Call Charges apply)  - **NRI Helpline:** +91 8916694100 (Call Charges apply)  - **Email:** service@hdfclife.com | nriservice@hdfclife.com (for NRI customers)   You can raise grievances through:  1. A signed letter at any HDFC Life branch. Each branch has a Grievance Redressal Officer. Check branch details [here](https://www.hdfclife.com/contact-us#BranchLocator). (Branches are closed on Sundays and holidays.)    2. Your registered email at service@hdfclife.com.   3. Our website: [Grievance Redressal](https://www.hdfclife.com/customer-service/grievance-redressal).   If you're unsatisfied with the response, refer to the escalation matrix or contact the Insurance Ombudsman in your region, as detailed in the policy document.

H) Nomination as per Section 39 of the Insurance Act 1938, as amended from time to time: 1) The policyholder of a life insurance policy on his own life may nominate a person or persons to whom money secured by the policy shall be paid in the event of his death. 2) Where the nominee is a minor, the policyholder may appoint any person to receive the money secured by the policy in the event of the policyholder's death during the minority of the nominee. The manner of appointment is to be set by the insurer. 3) Nomination can be made at any time before the maturity of the policy. 4) Nomination may be incorporated in the text of the policy itself or may be endorsed on the policy communicated to the insurer. The policy can be registered by the insurer in the policy records. 5) Nomination can be cancelled or changed at any time before the policy matures, by an approval or further approval or will, as the case may be. 6) A notice in writing of Change or Cancellation of nomination must be delivered to the insurer for the insurer to be liable to such nominee. Otherwise, the insurer will not be liable if a bona fide payment is made to the person named in the text of the policy or in the registered records of the insurer. 7) The fee to be paid to the insurer for registering the change or cancellation of a nomination can be specified by the Authority through Regulations. 8) A transfer or assignment made in accordance with Section 38 shall automatically cancel the nomination except in the case of assignment to the insurer or other transferee or assignee for the purpose of a loan or against security or its reassignment after repayment. In such a case, the nomination will not get cancelled to the extent of the insurer’s, transferee’s, or assignee’s interest in the policy. The nomination will get revived on repayment of the loan. 9) The provisions of Section 39 are not applicable to any life insurance policy to which Section 6 of the Married Women’s Property Act, 1874, applies or has at any time applied except where, before or after the Insurance Laws (Amendment) Act 2015, a nomination is made in favour of spouse or children, or spouse and children, whether or not on the face of the policy it is mentioned that it is made under Section 39. Where nomination is intended to be made to the spouse or children, or the spouse and children, under Section 6 of the MWP Act, it should be specifically mentioned in the policy. In such a case, only the provisions of Section 39 will not apply.

I. **Assignment as per Section 38 of the Insurance Act 1938:**   1. Policies can be assigned, wholly or partially, with or without consideration. 2. Assignment is made via endorsement on the policy or a separate notice to the Insurer. 3. The assignment instrument must state the purpose, assignee's details, and terms. 4. It must be signed by the assignor or authorized agent, and witnessed by at least one person. 5. The assignment is not valid against the Insurer until they receive written notice, along with the endorsement or a certified copy. 6. The Authority may specify fees for assignment. 7. Upon receiving notice and fees, the Insurer must acknowledge receipt in writing. 8. The Insurer can refuse an assignment if deemed not bona fide, not in the policyholder's interest, not in the public interest, or intended for trading the policy. 9. Any aggrieved individual can appeal to the IRDAI within 30 days of receiving a refusal letter.

J. **Prohibition of Rebates:** According to Section 41 of the Insurance Act, 1938:   (1) No person may offer or accept any rebate on commissions or premiums as an inducement for taking out, renewing, or continuing an insurance policy in India, except as allowed by the insurer's published materials.   (2) Non-compliance with this section may cause a penalty of up to ten lakh rupees.

K. **Non-Disclosure Summary under Section 45 of the Insurance Act, 1938:** 1. A life insurance policy cannot be questioned after three years from the policy's issuance, commencement of risk, revival, or rider date, whichever is later.    2. Within three years, a policy can be questioned on fraud grounds, provided the insurer communicates the reasons in writing to the insured or their representatives. 3. Insurers cannot repudiate a policy on fraud if the insured proves the misstatement or suppression of facts was unintentional or known to the insurer. The burden of disproving fraud rests with beneficiaries if the policyholder has passed away. 4. Policies may also be challenged within three years for incorrect statements impacting the insured's life expectancy. Insurers must inform the parties involved and refund premiums within ninety days if the policy is repudiated for these reasons. 5. Insurers may request proof of age at any time without the policy being questioned due to age discrepancies in the proposal. This is a simplified summary of the amendments to the Insurance Laws (Amendment) Ordinance, 2014. For complete details, please see the original Ordinance Gazette Notification of December 26, 2014.

**Important Notice, Appeal, and Disclaimer:** Sections H (Nomination) and I (Assignment or Transfer) provide a basic overview; however, these sections are not exhaustive. For comprehensive details, please refer to Sections 38 and 39 of the Insurance Act of 1938, as amended by the Insurance Laws (Amendment) Act of 2015. This blog presents a general summary of the policy, but readers are strongly encouraged to consult the specific terms and conditions to fully understand its associated risks, benefits, and details. Formal policy terms will prevail in all circumstances. The information in this blog has been compiled from open sources, mainly from hdfclife.com. While efforts have been made to ensure accuracy, the author does not assume liability for any inaccuracies or omissions. For informed decision-making, it is advisable to visit the official website to review the complete terms and conditions. This blog is authored by Arvind Kumar, a qualified professional who has successfully completed the IC-38 exam from the Insurance Institute of India. Currently, he works as a Life Advisor with HDFC Life Insurance Company. It is important to emphasize that a tailored life insurance plan should be designed to meet individual needs. For assistance with any insurance policies, Arvind Kumar can be reached via phone or WhatsApp at 9899423601 or 9971797791. You can also contact him via email at apcsitbranju@gmail.com or visit his YouTube channel at https://youtube.com/@arvindkumar-im4kq for more insights.