Press Esc to close
Wednesday 29 July 2015
News updated at 12:16 PM IST
Weather
Max: 19°C
Min : 32°C
In Bengaluru
Rain lightly

Irda raises lock-in period for Ulips to five years

Last updated: 28 June, 2010
Bangalore, June 28, DHNS:

In an effort to protect investors in life insurance, Insurance Regulatory & Development Authority (Irda) of India, on Monday, raised the lock-in period for Unit Linked Insurance Plan (Ulip) to five years from 3 years.

In a late evening circular, Irda said it has increased the lock-in period for all Ulip products from three years to five years, including top-up premiums, thereby making them long term financial instruments which basically provide risk protection.

Irda also said all regular premium / limited premium Ulips shall have uniform and level paying premiums. Which means that any additional payments shall be treated as single premium and they will have to have insurance cover. All limited premium unit linked insurance products, other than single premium products, shall have premium paying term of at least 5 years. It made it mandatory that the insurers shall distribute the overall charges, in Ulips in an even fashion during the lock-in period.

To make sure that all unit linked products, other than pension and annuity products, provide a minimum mortality cover or a health cover, Irda specified that the  minimum mortality cover should be at least 125 per cent of single premium for age at entry below 45 years and 110 per cent of single premium above 45 years. In case of regular premium contract the mortality cover should be 5 times the annualised premiums or Rs 100,000 per annum whichever is higher for entry age up to 45 and for entry age above 45  it should be 5 times the annualised premiums or Rs 75,000 per annum whichever is higher.

Irda has also specified that in case of the accumulated fund value of unit linked pension/annuity products a minimum guaranteed return of 4.5 per cent per annum (or as specified by Irda from time to time) must be offered on the maturity date. This guaranteed return is applicable on the maturity date, for policies where all due premiums are paid.  In the case of unit linked pension / annuity products, no partial withdrawal shall be allowed during the accumulation phase and the insurer shall convert the accumulated fund value into an annuity at the vesting date. However, the insured will have an option to commute up to a maximum of one-third of the accumulated value as lump sum at the time of vesting.  


Go to Top

Photo Gallery
Students of Indian Institute of Science (IISC) pays tribute to former President Abdul Kalam...

Students of Indian Institute of Science (IISC) pays tribute to former President Abdul Kalam...

People paying respects to the sand sculpture of former President APJ Abdul Kalam...

People paying respects to the sand sculpture of former President APJ Abdul Kalam...

The Indian national flag flies at half mast on the dome of India's presidential palace Rashtrapati..

The Indian national flag flies at half mast on the dome of India's presidential palace Rashtrapati..

Artist Ramzan Hussain makes a pencil sketch of former President APJ Abdul Kalam...

Artist Ramzan Hussain makes a pencil sketch of former President APJ Abdul Kalam...

SSM School students during the condolence meeting of Former President APJ Abdul Kalam...

SSM School students during the condolence meeting of Former President APJ Abdul Kalam...

School children in tears as they light candles to pay tribute to former President APJ Abdul Kalam..

School children in tears as they light candles to pay tribute to former President APJ Abdul Kalam..

Sachin Tendulkar paying his last respects to former President APJ Abdul Kalam...

Sachin Tendulkar paying his last respects to former President APJ Abdul Kalam...

Pranab Mukherjee laying a wreath on the mortal remains of former President APJ Abdul Kalam...

Pranab Mukherjee laying a wreath on the mortal remains of former President APJ Abdul Kalam...

Narendra Modi pays respect after the body of former President A.P.J. Abdul Kalam...

Narendra Modi pays respect after the body of former President A.P.J. Abdul Kalam...

Indian Air Force personnel pay their respects to former President of India APJ Abdul Kalam...

Indian Air Force personnel pay their respects to former President of India APJ Abdul Kalam...

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523