Kotak Term Plan comes with low premiums – Should you opt?

Kotak Term Plan ReviewKotak Term Insurance Plan Review


Life is uncertain and unpredictable. Every earning individual is worried about their loved ones in their unfortunate event of death. To overcome these uncertainties of life and to ensure that you are able to cope up with the financial obligations, Insurance companies have come up with the term plans. Term Plans provide risk coverage with low premiums. One such term plan is Kotak Term Plan designed by Kotak Life Insurance. Kotak Term Insurance Plan comes with low premiums. Should you opt for Kotak Term Plan? What are the features of this Kotak Term Insurance Plan?

Also Read: LIC’s new Jeevan Amar Term Insurance Plan – Should you opt?

What is Term Insurance Plan?


The term insurance plan is the most conventional form of insurance in which considerable benefits are paid to the family in case of death during the tenure of the policy. There is no maturity value payable if the insured survives till the end of the tenure. They come with very low premiums and offer higher coverage. They are highly preferred as they are able to secure their family satisfactorily against any loss of income which they might face in the absence of the life insured. They provide a lump sum amount in case of death of the insured. 

How to choose a good term insurance plan? 


Let me explain this with infographic about this.

Kotak Term plan - How to select a good term insurance plan

What is a Kotak Term Plan?


The Kotak Term Plan is the purest form of insurance plan designed for high protection of your family. It is a non-participating plan and in the event of the death of the insured during the term, the beneficiary would receive the sum assured as a lump sum. 

What are the features of the Kotak Term Plan?


Some of the key features of Kotak Term Plan are indicated below.

The term plan is highly economical with further reduced prices for women.

The death benefit paid would be the sum assured less the balance of the premium payable in the year of death (if any).

The premium can be paid in a single time or at regular intervals (annually, half-yearly, quarterly, or monthly).

Kotak life insurance has claim settlement ratio of 93.72% for financial year 2017-2018.

There is a grace period of 30 days from the due date for payment of premium for the yearly, half-yearly and quarterly mode. A grace period of 15 days is allowed for monthly mode of premium payment. 

If any premiums are not paid within the grace period, during the policy term, the policy together with the rider benefits (if any) shall lapse from the date of the first unpaid premium and the cover shall cease.

A lapsed policy can be revived within two years from the date of the first unpaid premium else the contract shall be terminated.

You can switch from Kotak Tem Plan to any other plan offered by Kotak Life Insurance provided that there are at least 5 years remaining before the cover ceases.

If you have chosen a single premium payment option, you may surrender the policy in the case of financial emergency.

Riders are also available for a nominal additional premium.

The policyholder is offered for a 15 day free-look period from the date of receipt of the policy.

The life insurance premium paid is eligible for deduction under section 80C of the Income Tax Act, 1962.

You can download the Kotak Term Plan brochure here.

Who is eligible to take the Kotak Term Plan?


The eligibility criteria of the Kotak Term Plan is:

Kotak Term Plan - Eligibility

What is the Basic Sum Assured offered under this plan?


This term insurance plan comes with a minimum sum assured of Rs 3 Lakhs and maximum sum assured of Rs 25 Lakhs.

What are various benefits available in Kotak Term Plan?


1) Death Benefit – In case of unfortunate death of life insurance, nominee would get sum assured minus the balance of the premium (if any) payable in the year of death.

2) Surrender Benefit – There is no surrender benefit available in this plan for regular premiums paid plan. However if you have opted for single premium plan, in case of financial emergency, you may surrender the plan and get upto 75% of the single premium paid.

3) Maturity Benefits – Since this is pure term plan, there are no maturity benefits.

What are additional riders available in Kotak Term Plan?


Kotak Term Plan provides with the following 3 rider benefits with nominal additional premium:

1) Kotak Accidental Death Benefit Rider: In case of death of life insured due to accident rider sum assured will be paid over and above life sum assured.

2) Kotak Permanent Disability Benefit Rider: In case life insured is permanently disabled, this rider benefit is paid in installments.

3) Kotak Critical Illness Benefit Rider – A portion of basic sum assured is paid in advance on the diagnosis of the covered critical illness subject to certain terms and conditions. Maximum rider benefit is Rs 20 Lakhs. Here is the list of critical illnesses covered under this rider.

i) Cancer of Specified Severity

ii) First Heart Attack – of Specified Severity

iii) Open Chest CABG

iv) Open Heart replacement or repair of heart valves

v) Kidney Failure requiring regular dialysis

vi) Stroke resulting in permanent symptoms

vii) Major organ . Bone Marrow transplant

viii) Permanent Paralysis of limbs

ix) Loss of limbs

x) Aorta surgery

xi) Major burns

xii) Blindness

You may like: What are 1 Crore Term Insurance Plans?

How are the premiums in Kotak Term Plan?


The following is an approximate sample premium table. The premiums given here are annual premium and exclusive of all kinds of taxes applicable.  

Kotak Term Plan - Premium Chart

What are the exclusions in Kotak Term Insurance Plan?


The general exclusions in Kotak Term Insurance Plan are:

If the insured commits suicide within one year from the date of issue of the policy, 80% of the premium paid shall be payable to the nominee.

In case, the insured commits suicide within one year of the date of revival and the revival is done within 6 months from the date of first unpaid premium, suicide exclusions would not be applicable and the death benefit would be payable as usual.

What are Positive Points of considering Kotak Term Insurance Plan?

Here are positives in this plan

1) Kotak Term Insurance comes with simple features and not complicated.

2) Kotak Term Insurance plan has optional riders which can be considered if required.

3) This term insurance plan comes with low and affordable life insurance premiums. If you are at young age and just started your financial planning, this plan could be best suitable to you.

4) This term plan comes with coverage of 12 critical illnesses.

Negative points of considering this Term Plan from Kotak Life Insurance

Here are some limitations or negative points

1) This plan has sum assured upto Rs 25 Lakhs only. Unless you are beginner in your financial life, this amount would not be sufficient for your family in your absense.

2) Riders that are optional comes with additional premiums

3) This is NOT online term insurance plan. Means you cannot purchase this plan online. You need to either reach out to Kotak Life insurance customer support or branch or agent to take this plan

Should you opt for Kotak Term Plan?


Kotak Term insurance is a simple term insurance plan. It offers sum assured only upto Rs 25 Lakhs which is very low. However, this term plan comes with low premiums. If you are at the young age, taking this term insurance plan could be a good idea. However, if you are looking for term plan of over Rs 25 Lakhs, this would not suffice your requirement. You may go for other best term insurance plans in India.

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Suresh KP

Kotak Term Plan comes with low premiums – Should you opt

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