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| Home> For
Groups > Kotak Gratuity Grouplan |
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| "In this policy,
the investment risk in the investment portfolio
is borne by the policyholder." |
| Overview |
| Gratuity is not just
a statutory obligation but also a very important
tool today to retain and attract talented employees.
A comprehensive and effective gratuity plan can
reduce your business cost and corporate tax. At
Kotak Life Insurance, we understand this. We have
therefore designed a gratuity management solution
that not only manages your gratuity liability effectively
but also helps you release resources for your core
business activities. |
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 Key
Highlights of Kotak Gratuity Grouplan (KGGP) |
- Market-linked returns and long
term investment growth (Unit-Linked Non-Participating
Scheme)
- Choice of nine investment
portfolios
- Switching facility amongst
the available fund options
- An in-built
life cover (equivalent to Future Service Gratuity
subject to a min of Rs 1000) that insures your
employees’ lives and provides security
to their families. Life cover is available
24 hours a day, 7 days a week, anywhere in
the world
- Critical Illness cover
at half of accelerated additional death cover
at a nominal cost
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| Who
can opt for KGGP? |
- Employer- employee groups that
fall under the purview of Payment of Gratuity
Act, 1972.
- Minimum group size: 10
members
- Minimum entry age: 18 years
- Maximum
cover age: Retirement age as specified in the
Trust Rules of the employer or 65 years whichever
is lower
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| How
does KGGP help me as an employer? |
- Contribution to an approved gratuity
fund is deductible under section 36(1) (v)
of the Income Tax Act, 1961.
- Income
earned from investments by an approved gratuity
fund is tax-exempt under section 10(25) (iv)
of the Income Tax Act, 1961.
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| How
does KGGP help my employees? |
- The gratuity settlement for retirement/resignation/withdrawal
(as the case may be) will be settled as per
the Trust Rules. Gratuity receipts are tax-exempt
in the hands of the employee up to the limit
of Rs. 3, 50,000 under section 10 (10) of the
Income Tax Act, 1961.
- The death
benefit will be equal to Future Service Gratuity
subject to a min of Rs 1000 plus gratuity settlement
as per the Trust Rules. Death benefits payable
to the employee are exempt from tax.
- In
the event of Critical Illness, a benefit equal
to rider amount, if opted will be paid. The
death benefit for the remaining term to retirement
will be reduced by the rider benefit paid.
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| What
are the other Services to look for? |
- Transparency in performance of
the fund (daily disclosure of Net Asset Value
(NAV) of units)
- Facility to pay the
gratuity contribution in installments
- Annual
Statement of Account with monthly newsletter
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| How
will contributions be made? |
| At inception, the initial
Gratuity contribution must be paid by way of a
transfer of assets to KGGP, subject to Kotak Life
Insurance and the employer agreeing to the valuation
of assets. Fresh contributions may be made into
the plan at the employer’s convenience. At
the end of the year, the contribution payable will
be determined on the basis of the accumulated asset
value and the actuarial valuation. |
| The premium for life
cover (compulsory) and critical illness cover (if
selected) is payable annually in advance. |
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| How
are the investments managed? |
- The contributions received will
be allocated to each fund in accordance with
the trustees’ instructions at the prevailing
NAV of the units. The unit prices of each fund
are based on the market value of the assets
in the unit fund.
- The trustees
can switch from one fund to another. Units
are sold and bought at prevailing NAV applicable
for respective investment funds.
- The
trustees can monitor the performance of the
selected funds on a daily basis on our website
www.kotaklifeinsurance.com. The asset allocation
of the funds is as follows:
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| Investment
Option |
Objective |
Risk - Return
Profile |
Equity |
Debt
(Including Money Market Instruments) |
| Kotak Group Aggressive
Growth Fund |
Aims
for a high level of capital growth by holding a
significant portion in equities.
May
experience high levels of shorter term volatility
(downside risk) |
Aggressive |
60%-100% |
0%-40% |
| Kotak Group Growth
Fund |
40%-80% |
20%-
60% |
| Kotak
Group Balanced Fund |
Aims
for moderate growth by holding a diversified mix
of equities and fixed interest instruments.
May
also be susceptible to moderate levels of shorter-term
volatility (downside risk) |
Moderate |
30%-60% |
40%-70% |
| Kotak
Group Dynamic Floor Fund |
Aims
to provide stable long term inflation beating growth
over the medium to longer term and defend capital
against short term capital shocks.
Is likely to out-perform traditional balanced or
equity funds during sideways or falling markets and
shadow the rising equity markets |
Cautious |
0%-60% |
40%-100% |
| Kotak Group Bond
Fund |
Returns
will be in line with those of fixed interest instruments,
and may provide little protection against unexpected
inflation increases
Will preserve capital and minimize downside risk,
with investment in debt and government instruments. |
Conservative |
- |
100% |
| Kotak Group Floating
Rate Fund |
- |
100% |
| Kotak Group Gilt
Fund |
- |
100% |
| Kotak Group
Money Market Fund |
Will
protect capital and not have downside risks |
Secure |
- |
100% |
| Kotak Fixed Maturity
Plan Fund* |
Will
generate stable returns through investments in
a suitable mix of debt and money market instruments |
Conservative |
- |
100% |
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| Note: The aggregate
exposure across the portfolios selected by the
clients to equities should not exceed 60% of the
total market value and to cash (money market instruments)
should not exceed 40% except for Kotak Group Money
Market Fund. |
| * Kotak Fixed Maturity
Plan Fund: This fund is a close-ended scheme with
specified maturity length of between 3 to 120 months;
and is defined by a maturity date. Each series
will have an initial subscription period, where
at the end of the series’ initial subscription
period, the Fund series will close to new business.
On the Maturity date, each Investor Scheme’s
holdings in the respective Fund Series will be
switched to a fund as selected by the Policyholder. |
| This is a multiple fund
series scheme where versions of the Fund defined
by different maturity dates are open for subscription
at the same time. |
 Investment
Management Philosophy
Kotak Group’s investment philosophy works
on the principles of transparency, flexibility
and well-defined investment portfolios. |
 Unit
Allocation
Allocation of contribution to each fund would be
done on a unitized basis as per the prevailing
IRDA guidelines. |
 Calculation
of Net Asset Value (NAV) =
(Market Value of investment held by the fund +/-
the expenses incurred in the purchase/sale of assets
+ value of Current Assets + any accrued income
net of fund management charges – value of
Current Liabilities- Provisions) divided by (Number
of units existing at the valuation date) |
| The Appropriation price
shall apply in a situation when the company is
required to purchase the assets to allocate the
units at the valuation date. This shall be the
amount of money that the company should put into
the fund in respect of each unit it allocates in
order to preserve the interests of the existing
policyholders. |
| The Expropriation price
shall apply in a situation when the company is
required to sell assets to redeem the units at
the valuation date. This shall be the amount of
money that the company should take out of the fund
in respect of each unit it cancels in order to
preserve the interests of the continuing policyholders |
| The Appropriation or
Expropriation Price (whichever prevails on the
date concerned) will be used with respect to portfolio
valuations for policyholders in addition to terms
for full or partial surrenders, maturity and death
settlement options. |
| The risk profile of
different asset classes is as under |
| Type of
Asset |
Risk Profile |
| Govt. & Govt. approved securities |
Low |
| Corporate Bonds |
Medium |
| Infrastructure as defined by IRDA |
Medium |
| Money Market and Other Liquid assets |
Very Low |
| Listed Equities |
High |
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 Fund
Management Charges
Each of the investment options operates in a totally
transparent manner, with the NAV of each fund posted
on our website daily, along with benchmarks for
each fund. Fund management charges vary depending
on the fund size and the investment option chosen
as indicated by the employer. These charges can
be altered at the sole discretion of the company,
subject to a maximum of 2% of funds under management,
with prior approval from IRDA. |
 Surrender
Charges
In case the policyholder wants to terminate/surrender
the policy, a surrender charge is applicable depending
upon the duration of the fund. In case a policy
is surrendered in the first policy year, the company
will charge 2% of fund value as surrender charge
while the charge would be 1% of the fund value
if the policy is surrendered in the second policy
year. No surrender charge will be levied if the
surrender occurs after completion of two policy
years.^ |
 Switching
Charges
Kotak Life Insurance’s Group Gratuity Plan
doesn’t levy any fee for switching between
fund options^. Thus the employer/trustees have
the flexibility to reallocate their portfolios
an unlimited number of times without incurring
additional charges. But the company reserves the
right to impose a switching charge subject to prior
approval from IRDA. |
| ^ except in case of
Kotak Fixed Maturity Plan Fund, where an early
exit penalty is charged as a percentage of fund
value. The applicable charges are as follows: |
| Time Elapsed since commencement
of Kotak Fixed Maturity Plan |
<=25% of total maturity
period |
>25% and <=50% of
total maturity period |
>50% and <=75% of
total maturity period |
>75% and <100% of
total maturity period |
| Charge |
2.5% |
1.5% |
0.75% |
0.5% |
|
 Mortality
& Rider Benefit Charges
The mortality charges and Critical Illness Benefit
charges are taken separately from the policyholder. |
 Non
forfeiture Benefits
If the employer / trustees stop paying the contributions,
the existing monies will continue to remain invested
in the respective funds. The usual fund management
charges will continue to be deducted. The policyholder
will have an opportunity, to revive the contract
within 2 years from the due date of last unpaid
premiums/contributions. During this limited period
of revival, the insurance cover (death cover) will
continue and appropriate mortality charges will
be deducted from the fund. |
| The employer may pay
the current as well as the arrears of premiums/contributions
at any time within these 2 years. The monies paid
will be applied to purchase units in the funds
chosen by the employer / trustees at the NAV. No
handling charges will apply. At the end of allowed
period of revival i.e. if contract is not revived,
the contract shall be terminated (by giving prior
notice) paying the surrender value. |
| In case of retirement
/ withdrawal, proportionate gratuity for the service
up to the period for which contributions were received & funding
made would be payable. On death, additional death
benefit will be payable. |
 Termination
of Policy
The policy and/or the benefit in respect of any
member can be terminated at the sole discretion
of the company, if the value of the units is not
sufficient to meet any charges, taxes or expenses,
or if it is found that the member data provided
was inaccurate or there was any material suppression
of member data within the provisions of Section
45 of Insurance Act, 1938. |
 Free
Look Period
The Policyholder is offered a 15 days free look
period, from the date of receipt of this policy.
During this period the Policyholder may choose
to reconsider his/her decision to hold this policy,
or may choose to return the same within the said
15 days. Should the Policyholder choose to return
the Policy, he/she shall then be entitled to a
refund of the premium paid after adjustments for
expenses for medical examination, stamp duty and
proportionate risk premium for the period of cover. |
 Insurance
Ombudsman
The company shall endeavour to promptly and effectively
address Policyholder’s grievances. However,
in case the Policyholder may not be satisfied with
the response of the company, he/she may also approach
the Insurance Ombudsman located in his/her region.
Details of the offices of the Ombudsman across
the country are made available on the website of
the company at www.kotaklifeinsurance.com and will
also be made available to the Policyholder on request. |
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| Risk
Factors |
- Unit Linked Life Insurance products
are different from traditional insurance products
and are subject to risk factors.
- The
premium paid in Unit Linked Life Insurance
policies are subject to investment risk associated
with capital markets and the NAVs of the units
may go up or down based on the performance
of the fund and factors influencing the capital
market and insured is responsible for his/
her decisions.
- Kotak Mahindra Old
Mutual Life Insurance Ltd. is only the name
of the company and Kotak Gratuity Grouplan
is only the name of the unit linked life insurance
contract and does not in any way indicate the
quality of the contract, its future prospects
or returns.
- Please know the associated
risks and the applicable charges, from your
insurance agent or the intermediary or policy
document of the insurer.
- The various
funds offered under this contract are the names
of the funds and do not in any way indicate
the quality of these plans, their future prospects
and returns.
- The past performance
of other plans of the Company is not necessarily
indicative of the future performance of any
of these funds.
- All benefits payable
under the Policy are subject to change in tax
laws and other financial enactments, in force
from time to time. Please consult your tax
advisor for details
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| If currently you do
not have a Group Gratuity plan, you can start one
today with Kotak Life Insurance! If you have an
existing Group Gratuity plan you can transfer your
fund to Kotak Life Insurance. We will help you
with all the necessary paperwork and guide you
through the process to make it hassle-free. |
Kotak
Life assures you of a cost effective fund management
for you
and your employees’ benefit in
a transparent and simplistic
manner without any
hidden costs! |
| Service Tax and education
cess shall be levied on all applicable charges
as per the prevailing tax laws and/or any other
laws. In case of any statutory levies, cess, duties
etc., as may be levied by the Government of India
from time to time, the Company reserves its right
to recover such statutory charges from the policyholder(s)
either by increasing the premium and / or by reducing
the benefits payable under the plan. |
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| Section
41 of the Insurance Act, 1938 states |
1) No person shall allow
or offer to allow, either directly or indirectly,
as an inducement to any person to take or renew or
continue an insurance in respect of any kind of risk
relating to lives or property in India, any rebate
of the whole or part of the commission payable or
any rebate of the premium shown on the policy, nor
shall any person taking out or renewing or continuing
a policy accept any rebate, except such rebate as
may be allowed in accordance with the published prospectuses
or tables of the insurer:
Provided that acceptance by an insurance agent of
commission in connection with a policy of life insurance
taken out by himself on his own life shall not be
deemed to be acceptance of a rebate of premium within
the meaning of this sub section if at the time of
such acceptance the insurance agent satisfies the
prescribed conditions establishing that he is a bona
fide insurance agent employed by the insurer.
(2) Any person making default in complying with the
provisions of this section shall be punishable with
fine which may extend to five hundred rupees |
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| Section
45 of the Insurance Act, 1938 states |
No policy of life insurance
effected before the commencement of this Act shall
after the expiry of two years from the date of commencement
of this Act and no policy of life insurance effected
after the coming into force of this Act shall, after
the expiry of two years from the date on which it
was effected be called in question by an insurer
on the ground that statement made in the proposal
or in any report of a medical officer, or referee,
or friend of the insured, or in any other document
leading to the issue of the policy, was inaccurate
or false, unless the insurer shows that such statement
was on a material matter or suppressed facts which
it was material to disclose and that it was fraudulently
made by the policy holder and that the policy holder
knew at the time of making it that the statement
was false or that it suppressed facts which it was
material to disclose:
Provided that nothing in this section shall prevent
the insurer from calling for proof of age at any
time if he is entitled to do so, and no policy shall
be deemed to be called in question merely because
the terms of the policy are adjusted on subsequent
proof that the age of the life insured was incorrectly
stated in the proposal. |
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| Kotak Gratuity
Grouplan – UIN: 107L010V02 Critical Illness
Benefit (Rider) UIN 107C009V01 Ref No: KLI/08-09/P-PB/127 |
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Kotak Mahindra
Old Mutual Life Insurance Ltd. Regn. No.:107, Regd.
Office: 9th floor, Godrej Coliseum, Behind Everard
Nagar, Sion (East), Mumbai – 400 022.
Website:
www.kotaklifeinsurance.com
Email: lifeexpert@kotak.com
SMS KLIFE to 5676788.
Toll Free No:1800 209 8800 |
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| Insurance is
the subject matter of the solicitation. This is a
non-participating unit-linked group plan. This document
is not a contract of insurance and must be read in
conjunction with the Policy Document. Hard copy of
the information will be provided on request. |
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