SBI Life Smart Scholar
SBI Life Smart Scholar
  • Free Look Period
  • Grace Period Of 30 Days
  • Policy Surrender Option
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SBI Life Smart Scholar

SBI Life Smart Scholar is a non-participating child unit-linked insurance plan that comes with the death benefit, maturity benefit as well as tax benefit. The objective of the Smart Scholar insurance plan is to offer myriad coverages to secure the future of the insured child even in the absence of its parents.

Key Features of SBI Life Smart Scholar

The SBI Smart Scholar plan is a unique child plan that combines the benefit of insurance with investment. The plan guarantees the lump sum amount at the maturity of the policy and a waiver on the premium in case of an eventuality. The insured also has an option to choose from among nine best fund options which include:

  • Money Market Fund
  • Top 300 fund
  • Equity Fund
  • Balanced Fund
  • Growth Fund
  • Equity Optimizer Fund
  • Bond Fund

The Smart Scholar Policy offers loyalty additions to the fund, increasing the fund value and thus, the payout at maturity. These loyalty additions are paid even after the insured is dead.

Product Specifications

The table below elaborates on the various specifications of the product.

SpecificationsMinimumMaximum
Eligibility (Age)Child- 0 Years
Parent- 18 Years
Child- 17 Years
Parent- 57 Years
Policy Tenure825
Premium Payment TenureSingle Pay or 5 to 25 Years
Maturity AgeChild- 18 Years
Parent- NA
Child- 25 Years
Parent- 65 Years
Tenure of the Policy8 Years25 Years
Frequency of PremiumMonthly, Quarterly, Half-Yearly or Yearly

The minimum sum assured for the Smart Scholar Plan for Regular Pay (above the age of 25 years) is the higher of:

  • 10x annual premium
  • 0.5x term annual premium

The minimum sum assured for individuals for Regular Pay (below the age of 45 years) shall be higher of:

  • 7x annual premium
  • 0.25 term annual premium

The maximum regular pay sum assured shall be 20x annual premium.

Sum Assured for Regular Pay
MinimumMaximum
Above the age of 45 years:
Higher of – 10x annual premium or 0.5x term annual premium
Below the age of 45 years:
Higher of – 7x annual premium or 0.25x Term Annual Premium
20x annual premium

The minimum Single Pay sum assured shall be 1.25x the Single premium. The maximum Single Pay sum assured shall be 35x single premium for ages above 45 years and 1.25x single premium for ages below 45 years.

Sum Assured for Single Pay
Minimum Maximum
1.25x Single PremiumAbove the age of 45 years:
35x Single Premium
Below the age of 45 years:
1.25x Single Premium

SBI Life Smart Scholar Policy Details

The points listed below are some of the most significant details you need to know about the policy.

  • Grace Period- The policy comes with a grace period of 30 days in the event of the payment of premium. In case your premium payment frequency is monthly, the grace period allowed is 15 days.
  • Free Look Period- The policy also comes with a free look period. If you are not pleased with the coverage, inclusions or terms and conditions of this policy, you can choose to cancel it within 15 days of receipt of the policy documents.
  • Policy Surrender- The policyholder may surrender the policy after 5 years. On the surrender of the policy after the specified tenure, the policyholder will be eligible to receive the fund value on the date of surrender without having to pay any charges.
  • Policy Termination- In case the policy is terminated before 5 complete years, the fund value as on the date of surrender (net charges of discontinuation) will be credited to the discontinued policy fund. The fund will be subjected to a minimum of 4% p.a. till the completion of 5 years.

Additional Features of SBI Smart Scholar Policy

In addition to the in-built features of the policy, various features come as an add-on. For instance, the policy is inclusive of a premium waiver rider that pays the premium in the event of the death of the insured.

The policy also includes a clause that guarantees a lump sum assured in the event of permanent and total disability in the event of an accident.

Inclusions and Exclusions of the Policy

The policy comes with the following inclusions:

  • An annual partial withdrawal of a minimum value of INR 5,000 and a maximum value of 15% of the value of the fund as on the withdrawal date.
  • 2 free switches in the policy every year.
  • The policyholder gets the benefit of premium redirection from the 2nd policy year.

The policy comes with the following exclusions:

  • Exclusions on the accident benefit in case of accidents caused due to self-inflicted injury, drug abuse, war, infection, aviation, and criminal activities.
  • In case of suicide within 12 months from the inception of the policy, the fund value as on the date will be paid as a benefit to the policyholder.

Illustration (Example)

Mr. Sharma (32) invests in the SBI Life Smart Scholar Plan for his child (6). He invests in a regular plan with a policy term of 20 years, the frequency of payment being yearly. The annual premium of INR 2, 00,000 is paid all along with the policy term (Basic Sum Assured- INR 20, 00,000). Mr. Sharma decides to invest in the Top 300 Fund.

Calculating the fund value at Maturity at an assumed interest rate of 4%, we get INR 46, 87,282 the time of maturity.

Assuming the rate of payout is 8%, the fund value at maturity stands at INR 74, 15,458.

In the event of the unfortunate death of Mr. Sharma in the 7th Policy Year, all future premiums will be waived off.

Smart scholar Illustration

Review of SBI Life Smart Scholar Policy

Recapitulating the benefits and features of the SBI Life Smart Scholar Plan, we see that it offers premium options lower than most other life insurance policies in the market. The plan offers attractive discounts, loyalty additions and premium waivers which gives it an extra edge over other ULIP Child Plans. The company also boasts of having a good claim to settlement ratio which makes it a reliable option for first-time investors.

SBI Life Smart Scholar Plan: FAQs

1. What is the return payable on the untimely death of the insured?

The beneficiary is eligible to receive 105% of the total premium paid or the sum assured, whichever is higher.

2. Can I get tax benefit on the claim on SBI Life Smart Scholar Plan?

Yes, you are eligible to get tax benefit on the claims (as per Section 10(10D)) of the Income Tax Act.

3. Is there a loan facility available for the SBI Life Scholar Plan?

No, there is no loan facility available for the SBI Life Scholar Plan.

Last updated on 12-03-2020