All pension products will be offered either as individual-linked pension or group-linked pension products. They will have explicitly defined assured benefit payable on death and vesting. The defined assured benefit will have to be disclosed at the time of sale and utilised on the vesting date or on the date of death.
The Insurance Regulatory Development Authority’s (Irda) draft exposure on standard products has said that all pension products offered by insurance companies will have an insurance cover throughout the deferment period, or may offer riders. The sum of all the rider premiums attached to the pension product will not exceed 15% of the premium paid for the pension policy. Such rider premiums will be separately accounted for and will not be included in arriving at the assured benefit.
For financial planning, any pension product offered by insurer will have to comply with the sales literature guidelines issued by the Life Insurance Council. An illustrative target purchase price for each policyholder will consider the premium payment, capacity, age, vesting age and the future expected conditions. The policy will have to mention any possible risks involved
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