tata aia life insurance
Tata AIA Fortune Guarantee Pension Policy

Tata AIA Fortune Guarantee Pension Plan

As we approach retirement days, a sense of financial insecurity grasps us as the regular flow of income gets hampered. But that does not mean that our responsibilities decrease, rather the expenditure increases as old age is more prone to different ailments. Therefore, to keep your retirement days safe and protected, you need to invest in an annuity plan. in that case, the Tata AIA Fortune Guarantee Pension plan will be recommendable as it helps you gain financial freedom during your second innings. The plan offers you a regular guaranteed income for life to help you manage your expenses post-retirement. It is a non-participating, non-linked annuity plan that promises you worry-free golden days of your life. To know more about this plan, have a look at the following mentions.

Eligibility Criteria

ParametersDescriptions
Age at entry

Minimum:

For POS Option 2: 40 years

Other than POS: 30 years

Maximum:

For POS Option 2: 70 years

Other than POS Option 1 & 2: 85 years

Option 3 & 4: 84 years

Premium payment term

Single pay – 1 year

Regular/Limited pay:

Minimum – 5 years

Maximum – 12 years

Deferment period

Single pay:

Minimum – 1 year

Maximum – 10 years

Regular pay – Similar to premium payment terms.

Limited pay:

Minimum – Premium Payment Term + 1 year

Maximum – Premium Payment Term + 5 years

Annuity amount

Minimum:

Yearly in arrears: Rs 12 (in ‘000s)

Yearly in advance: Rs 12 (in ‘000s)

Half-Yearly in arrears: Rs 6 (in ‘000s)

Quarterly in arrears: Rs 3 (in ‘000s)

Monthly in arrears: Rs 1 (in ‘000s)

Maximum: No upper limit, subject to board approved underwriting policy.

Purchase price

Minimum: Corresponding to the minimum annuity amount above.

Maximum: As per the maximum annuity chosen

Group size

Minimum – 5

Maximum – No upper limit

Premium Paying ModesSingle, Annual, Half-Yearly, Quarterly, and Monthly modes are available.

What will you get with Tata AIA Fortune Guarantee Pension Plan?

This plan has come up with a sack full of benefits and facilities that promise to keep your retirement days safe and protected financially. The following details will give you a descriptive idea of this plan. Have a look.

Annuity Options:

The Annuity Options available to you/group members under this product are Immediate Life Annuity, Immediate Life Annuity with Return of Purchase Price, Deferred Life Annuity (GA-I) and with Return of Purchase Price, and Deferred Life Annuity (GA-II) and with Return of Purchase Price Plan Options, 1 and 2 are available under Single Pay & Single Life and Joint Life basis. Plan Options 3 and 4 are available under Single, Limited, and Regular Pay & Single Life and Joint Life basis.

Annuity option available for POS channel:

Type of annuityOnly Single Life Immediate Annuity
Annuity option availablePlan Option 2 – Immediate Life Annuity with ROP

Guaranteed Additions:

During the Deferment Period, Guaranteed Additions accrue at the end of each completed policy month, subject to all due premiums being paid, and form a part of the Death Benefit offered under the option. The product offers 2 types of Guaranteed Additions:

  • GA-I = 1/12th of the Yearly Annuity amount
  • GA-II = 1/12th of 6% of Total Premiums Paid (excluding loading for modal premium)

Guaranteed Additions will be available under Plan Options 3 and 4. No Guaranteed Additions shall accrue once the policy has lapsed or been converted to a Reduced Paid-up policy. In the case of Joint Life, the Primary Annuitant will be the primary person entitled to receive the Annuity Payouts, while the Secondary Annuitant will be entitled to receive the Annuity Payouts in the event of the death of the Primary Annuitant, as applicable. In a Joint Life annuity, the Secondary Annuitant can be the spouse/child/parent/parent-in-law or sibling of the Primary Annuitant

Immediate Life Annuity Option:

Annuity shall be paid till the annuitant(s) is/are alive. There is no death benefit payable under this option. Annuity payments commence immediately as per the frequency chosen.

Immediate Life Annuity with Return of Purchase Price Option:

Annuity is paid till the annuitant(s) is/are alive and annuity payments commence immediately as per the frequency chosen. The death benefit is the Total Premiums Paid to date.

Deferred Life Annuity (GA-I) with Return of Purchase:

Annuity is paid till the annuitant(s) is/are alive and annuity payments commence post the end of the Deferment Period as per the frequency chosen.

  • The death benefit payable within the Deferment Period: Death Benefit is higher of total Premiums Paid (excluding loading for modal premiums) up to the date of death + Accrued Guaranteed Additions, or 105% of Total Premiums Paid (excluding loading for modal premiums) up to date of death.
  • Death benefit payable Post Deferment Period: Total Premiums Paid (excluding loading for modal premiums) up to date of death + Max (Accrued Guaranteed Additions − Total Annuity payouts till date of death, 0).

Deferred Life Annuity (GA-II) with Return of Purchase Price:

Annuity is paid till the annuitant(s) is/are alive and annuity payments commence post the end of the Deferment Period as per the frequency chosen.

  • Death benefit payable within the Deferment Period: Death Benefit is higher of total Premiums Paid (excluding loading for modal premiums) up to the date of death + Accrued Guaranteed Additions, or 105% of Total Premiums Paid (excluding loading for modal premiums) up to date of death.
  • Death benefit payable Post Deferment Period: Total Premiums Paid (excluding loading for modal premiums) up to date of death + Max (Accrued Guaranteed Additions − Total Annuity payouts till date of death, 0).

Annuity Payout:

As per the followings:

  • Yearly Annuity (Single Pay) = Rate A * (Single Premium up to R X) + Rate B * (Single Premium in excess of R X).
  • Yearly Annuity (Regular Pay / Limited Pay) = [Rate A * (Annualised Premium up to R X) + Rate B * (Annualised Premium in excess of R X)] * Premium Payment Term

For Single Pay, X = Rs. 5,00,000

For Regular/Limited Pay, X = Rs. 1,00,000

Your annuity shall be payable as per the chosen annuity payment mode from the date of purchase of the plan. This implies that:

FrequencyThe annuity payout would start after
Annually in arrearsOne year from the purchase/end of the Deferment Period
Half-yearly in arrearsSix months from the purchase/end of the Deferment Period
Quarterly in arrearsThree months from the purchase/end of the Deferment Period
Monthly in arrearsOne month from the purchase/end of the Deferment Period
Annually in advance (except for Option 1)Purchase/end of Deferment Period

Key Features of Tata AIA Fortune Guarantee Pension Plan

Apart from the above benefits and facilities, this plan has presented a bunch of special features and advantages that have made the plan unique and popular among customers. The mentions are as follows.

Modal loading: Modal loading is as follows.

Single Premium Rate: Multiply Single Premium Rate by 1 (i.e., No loading)

Annual Premium Rate: Multiply Annual Premium Rate by 1 (i.e., No loading)

Half-Yearly Premium Rate: Multiply Annual Premium Rate by 0.51

Quarterly Premium Rate: Multiply Annual Premium Rate by 0.26

Monthly Premium Rate: Multiply Annual Premium Rate by 0.0883

Top Up Option:

There is an option, Top-Up, to increase the annuity by paying an additional Purchase Price/Premium as a Single Pay at any time after six months after the Policy Commencement Date.

  • The additional purchase can be made provided the policy is in force with no due premiums outstanding.
  • The named annuitant(s) in the Top-Up must be the same as that of the base policy.
  • The prevailing annuity rate for the revised purchase price slab and attained the age of the annuitant(s) will be applicable for the additional purchase price.
  • The policyholder will have a choice to match the timing of the top-up annuity with that of the base annuity.
  • Any Top-up tranche can be surrendered independent of the base policy or other top-up tranches.
  • The benefit payable on Death, Survival, or Surrender would be calculated separately for the base policy and each top-up tranche and the total would be payable.
  • If the Base policy is surrendered, all top-up tranches will also be surrendered at the same time.

Surrender Benefit:

No surrender benefit is applicable for Option 1. The policy shall acquire a surrender value basis in the Premium Payment Mode as defined below:

Premium payment modeSurrender value payable
Single payAt any time after the Policy Commencement Date
Regular, or Limited payProvided at least 2 full years’ premiums have been paid

The surrender value payable is higher of the Guaranteed Surrender Value (GSV) or Special Surrender Value (SSV). In case of Frequency of Annuity Payment other than annually in arrears, the Surrender Benefit shall be paid after deducting any Annuity pay-outs made during the Policy Year. The maximum SSV shall be restricted to the Death Benefit.

Paid-up Benefit:

If you have not paid at least two (2) full years of Premiums, the Policy will be converted to a lapsed Policy at the end of the grace period, and no benefit will be payable. If you have paid at least two (2) full-year Premiums, and subsequent Premiums have not been paid, your Policy will be converted to a Paid-up Policy at the end of the grace period and the Annuity amount will be converted to Paid-up Annuity.

Paid-up Annuity:

(Total period for which premiums have already been paid / The maximum period for which premiums were originally payable) * Original Annuity Amount

Rider Attachment:

The below-mentioned rider(s) would be available with the base product:

  • Tata AIA Life Insurance Non-Linked Comprehensive Protection Rider.
  • Tata AIA Life Insurance Non-Linked Comprehensive Health Rider.

Discounts:

For Single Pay greater than Rs. 5 lakhs and RP / LP greater than Rs. 1 lakh annual premium, higher annuity rates will be applicable on the incremental premium. There are policy rebates available on satisfying certain criteria as outlined in the Bulk Annuity purchase and NPS sections below, which will be provided in the form of an increased annuity. The total incremental annuity shall not exceed 1% of the annuity rate as otherwise applicable, even if the annuitant might be eligible to avail of policy rebates under multiple criteria at the same time.

Bulk Annuity purchase:

This plan can be utilized for bulk annuity purchases by a scheme set up to provide regular pension benefits for its members. Such purchase will be subject to applicable scheme rules and must comply with the eligibility conditions as approved for this product. The company will offer an additional annuity of 1% of the annuity rate to such bulk annuity purchases.

Utilization of Return of Purchase option for NPS subscribers:

In case this annuity option is purchased as a default option by a government sector NPS subscriber through funds accumulated in his/her NPS scheme, the utilization of Death Benefit will be as per Pension Fund Regulatory and Development Authority Regulations, 2015. The company will offer an additional annuity booster of 1% of the annuity rate to such NPS subscribers whilst purchasing an annuity.

What are the exclusions of the Tata AIA Fortune Guarantee Pension Plan?

Understanding a policy is not completed if you do not go through its exclusions of it thoroughly. Therefore, to offer you a comprehensive idea of the policy, here are the exclusions of the Tata AIA Fortune Guarantee Pension Plan.

  • Anything that does not satisfy the terms and conditions of the company as well as of the policy, will fall under the category of exclusions.
  • If there is any kind of breach of law with criminal intent, that will be permanently excluded from the policy.
  • In case of death due to suicide within 12 months:
    1. From the date of commencement of risk under the policy or from the date of revival of the policy, as applicable, the nominee or beneficiary of the policyholder shall be entitled to at least 80% of the Total Premiums Paid till the date of death or the surrender value available as on the date of death whichever is higher, provided the policy is in force; or
    1. From the date of exercising the Top-Up Option, the nominee or beneficiary of the policyholder will be entitled to 80% of the respective Top-Up Premiums paid (excluding any extra premium, any rider premium, and taxes). The original death benefit (based on the Purchase Price chosen at the time of purchase) and any increased death benefit purchased by exercising the Top-Up Option subsequently but prior to 12 months from the date of death (due to suicide) will remain payable in full.
    1. In the case of joint life policy, the above clause is applicable if any of the two lives commits suicide within 12 months from the commencement of risk under the policy or the exercising of the Top-Up Option, as applicable.
    1. This is applicable only for options 3 and 4 and during the deferment period. No benefit is payable on suicide otherwise.

How does Tata AIA Fortune Guarantee Pension Plan work?

Mr. Gautam, a 46-year-old businessman purchased Tata AIA Fortune Guarantee Pension Plan for himself. Let us find out how much premium amount he has to pay to avail of the benefits of the policy for the given credentials.

ParametersData
Age46 years
Policy forSelf
SmokerNo
Premium payment modeSingle
InvestmentRs. 6 lakhs
Premium payment term1 year
Purchase Price (Premium including GST)Rs. 6,10,800
Type of annuityImmediate Annuity
Deferment periodNA
Pension payment modeMonthly
Premium amountRs. 6 lakhs (Single pay)
Monthly annuity amountRs. 3373

Frequently Asked Questions

The minimum Purchase Price that will produce the minimum annuity will depend on the minimum annuity rates, as applicable. Annuity rates may be reviewed by the company subject to IRDAI approval on a periodic basis and the revised rates will be applicable for future new policies including Top-ups if any.

The annuity payments will be payable as per the chosen annuity payment frequency from the date of purchase of the plan (for Immediate Life Annuity options) or from the end of the Deferment Period (for Deferred Life Annuity options).

Annualized Premium will be the premium payable in a year under a non-single pay option chosen by the policyholder, excluding the taxes, rider premiums, underwriting extra premiums, and loading for modal premiums, if any. Single Premium will be the premium payable under a single payment option chosen by the policyholder, excluding the taxes, rider premiums, and underwriting extra premiums, if any.

Annuity frequency can be changed at the policy anniversary except when the Annuity installment will breach the minimum. Annuity installments will be as specified below:

ModeAnnuity Instalment (per mode selected)
Yearly in arrearsYearly annuity
Half-yearly in arrears98% of Yearly Annuity x ½
Quarterly in arrears97% of Yearly Annuity x ¼
Monthly in arrears96% of Yearly Annuity x 1/12
Annually in advance93% of the yearly annuity

There is no maturity benefit in this plan.

The Reduced Paid-up (RPU) Factors are:

  • The Paid-up Annuity amount will be paid as and when the annuity payment falls due.
  • Guaranteed Additions (GA) will not be applicable to a Paid-up Policy. The Policy will continue with the already attached Gas.
  • If any top-up Premium has been paid in the Policy, the benefit with respect to the top-up Premium remains unchanged.
  • The total Annuity amount payable under the Policy will be Paid-up Annuity plus the Annuity amount with respect to the top-up Premium.

If the Master Policyholder/Annuitant is not satisfied with the terms & conditions of the policy, s/he can cancel the Policy by providing written notice to the Company and receive a refund of all premiums paid without interest after deducting Stamp duty and Medical Examination costs (including goods and services tax), if any which have been incurred for issuing the Policy. Such notice must be received directly by the Company within 15 days after the Master Policyholder/Annuitant receives the Policy Document. The said period of 15 days shall stand extended to 30 days if the policy is sourced through electronic or distance marketing mode.

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