HDFC Life Click 2 Wealth – details, review and Premium-Maturity Calculators. Click 2 Wealth is a unit-linked life insurance plan with lower charges, comparable to mutual funds. Only the fund management charges and mortality charges (Risk coverage charges) are applicable to this plan.
Low charges, along with flexible investment options, risk coverage, and tax benefits make it a good long term investment plan.
HDFC Life Click 2 Wealth – Key Features
- Term of the plan can be selected between 5 to 20 years
- Premium payment can be done in 1, 5, 7, 10 years or a period equal to the policy term.
- 101 % of the premium will be allocated to the fund for the first five years.
- Mortality charges will be refunded at the time of maturity.
- 8 fund options are available to invest and can be selected based on the risk appetite.
- At maturity, you will receive the accumulated fund value which is the product of the number of units available and the then prevailing unit price.
- Death coverage will be the higher of
- Sum Assured
- Fund value
- 105% of premiums paid
- Partial withdrawal and settlement option available.
- Three plan options to maximize the benefits
- Invest Plus Option for Insurance cum Investment
- Premium Waiver Option to protect the future needs for dependents
- Golden Years Benefit Option for retirement planning with whole life cover
- Systematic Transfer plan strategy for the advantage of Rupee Cost Averaging
Eligibility Conditions and Restrictions – HDFC Life Click to Wealth
|Age at entry||30 days||65 Years|
|Age at maturity||18 Years||75 Years|
|Policy Term||5 Years||20 Years|
|Premium Amount||Single – Rs 24,000
Annual – Rs 12,000
Half Yearly – Rs 6,000
Quarterly – Rs 3,000
Monthly – Rs 1,000
|Golden Years Benefit Option||30 days||60 Years|
|Premium Paying Term||Single Premium
Limited Payment – 5, 7 and 10 Years
Regular – Same as policy term
|Sum Assured Calculation|
|Single premium||1.25 times of Premium|
|Limited and Regular||Higher of (1) 10 times Annualized Premium
(2) 0.5 x T* x Annualized Premium
|Top up||1.25 x Top-up Premium|
*Value of T is defined as Policy Term for Invest Plus and Premium Waiver Option and 70 minus Age at Entry for Golden Years Option.
Benefits of HDFC Life – Click 2 Wealth
The pattern of Maturity Benefit varies based on the investment option selected.
Invest Plus Option: Maturity Benefit shall be available at the end of the term chosen by the policyholder. The benefit amount will be the fund value available at that time and is arrived by multiplying the number of units available with the Net Asset Value (NAV) of the fund.
For example: If the number of units available is 10,000 and the NAV of the fund is 34.25 the maturity amount will be 10,000 X 34.25 = 3,42,500.
Consider a person aged 30 Years investing in this option. The details of the policy will be as follows.
|Plan||Premium Paying term||Policy Term||Annualized Premium|
|Invest Plus||20 Years||20 Years||1,00,000|
The maturity amount can be obtained as a single lump sum amount or as installments, thanks to the Settlement Option. Read more about settlement option later in this post.
Premium Waiver Option: In case of Proposers unfortunate death, all future premiums will be paid by the company. The Policy continues with risk cover for Life Assured and the accumulated Fund Value is paid on Maturity. On the death of the Policyholder, the Life Assured will become the Policyholder.
Consider a person of age 40 investing in this plan for his daughter aged 10 years. The details of the plan will be as follows.
|Plan||Age of Daughter||Term / PPT||Unfortunate death of proposer|
|Premium Waiver||10 Years||20/20||After 5 years|
Golden Years Benefit Option: This plan option offers you the solution to build your fund value while also having life cover for the whole of life (till 99 years of age). Option for a systematic withdrawal facility is there to generate recurring post-retirement income from your accumulated fund.
Consider a person aged 50 Years investing for his retirement benefits in this option. The details of the policy will be as follows.
|Plan||Age of Proposer||Term / PPT||Retirement Benefits|
|Golden Years Benefit option||50 Years||Whole life / 10 Years||from 70 Years of age|
HDFC Click 2 Wealth Calculator
Online calculator for HDFC Life Click to Wealth is intended to provide you all the details of the plan in a simple and easy to understand way. Provide your details such as age, term, premium payment period, etc and get the calculations. Comparison of various investment options is also provided in this powerful online calculator.
If you are unable to view the calculator here, click to open HDFC Click 2 Wealth calculator.
Death Benefit: Benefits payable in case of unfortunate death.
The death benefit of the policy shall be the highest of:
- Total Sum Assured (Basic Sum Assured + additional sum assured through top-ups) less partial withdrawal made (if any).
- Fund Value (No of units * NAV)
- 105 % of the total premium paid
Benefits if the premium payment is discontinued
This plan has a grace period of 15 days for monthly mode and 30 days for other modes. If you have not paid your premium by the expiry of the grace period, then you will have the following options:
- To revive the policy within a period of 2 years from the date of discontinuance, or
- To completely withdraw from the policy without any risk cover and receive the discontinuance value at the end of the lock-in period of 5 policy years.
If the premiums are discontinued before completion of 5 policy years – Once the grace period for paying premiums gets over,
- Fund Value at that time will move to the Discontinued Policy Fund.
- Your risk cover will cease.
- Here you would earn an interest rate of a minimum of 4% (this is as per the current regulations).
- A Fund Management Charge of 0.5% would apply and there would be no other charges.
- After 5 policy years, the funds will be paid to the policyholder.
You stop paying the premiums after completion of 5 policy years – After the grace period of paying premiums gets over, you have the following options:
- Withdraw your money and close the policy
- Convert the policy to paid-up and continue with a reduced sum assured. Your investments can be withdrawn anytime later
- Revive the policy by paying the due premiums and continue with the plan. This has to be done within 2 years of the date of discontinuance.
The revival of your policy – You can revive your discontinued policy by paying all the missed premiums and on meeting any applicable underwriting criteria of the company. No interest will be charged on the missed premiums.
Special provisions to enhance fund values
1. Return of mortality charges (ROMC) at maturity
At the maturity date, the total amount of mortality charges deducted in respect of insurance coverage of the life assured throughout the policy will be added to the fund value. Mortality charges deducted for top-up Sum Assured also will be refunded.
For the Golden Years Benefit Option, as it is a whole life plan, the mortality charges will be added to the fund value at the end of policy year coinciding or immediately following the 70th birthday of the life assured.
Note: ROMC benefit will not be applicable for surrendered, discontinued or Paid-up policies. It will not be applicable for policies where the Waiver of Premium benefit is triggered due to the death of proposer.
2. Special Fund Addition
For Regular and Limited Premium policies, 1% of annualized premium shall be added to the premium for the first 5 policy years. On the other hand for single premium policies , 1% of the single premium shall be added at the time of allocation of single premium. This facility shall be available for all the three modes of the policy viz, Invest Plus, Premium Waiver Option and Golden Years Benefit Option.
3. Claw-back Additions
Company may provide special fund additions called non-zero positive claw back additions at specific intervals, to comply with the reduction in yield requirement, after the first five years of the contract, as per the IRDA regulations from time to time.
Top-up of premiums
Policy holder has the options of paying top-up premiums subject to following conditions.
- Top-up premiums are not permitted in the last five years of the contract.
- Total Top-up Premiums cannot exceed the sum total of the regular/limited premiums paid till that point of time or initial single premium paid, as applicable.
- Top-Up Premium will carry a Sum Assured of 125% of the amount of Top-Up Premium
HDFC Click 2 Wealth – Fund Options
|Fund Name||Fund Composition||Risk & Return Rating|
|Money Market Instruments, Cash, Deposits, Liquid Mutual Funds||Government Securities, Fixed Income Securities||Equity|
|Equity Plus||0% to 20%||0% to 20%||80% to 100%||Very High|
|Diversified Equity||0% to 40%||0% to 40%||60% to 100%||Very High|
|Blue Chip||0% to 20%||–||80% to 100%||Very High|
|Opportunities||0% to 20%||–||80% to 100%||Very High|
|Balanced||0% to 20%||0% to 60%||40% to 80%||Moderate to High|
|Income||0% to 20%||80% to 1000%||–||Moderate|
|Bond||0% to 60%||40% to 100%||–||Moderate|
|Conservative||0% to 60%||40% to 100%||–||Low|
Read more: Fund switching techniques for ULIP policies
Charges Applicable for HDFC Click 2 Wealth
Fund Management Charge (FMC)
0.8% per annum of the fund value for liquid fund and 1.35% per annum for all other funds. Deducted on daily basis.
- Mortality charge is levied for providing the death benefit in the policy.
- The rate is guaranteed for the entire duration of the policy term.
- Mortality charges are levied every month at applicable rates.
- For premium Waiver Option the sum at risk for proposer will be the present value of future premiums discounted at 5%
As mentioned earlier, the entire mortality charges deducted will be refunded at the time of maturity.
In addition, only if you request for partial withdrawal, fund switch and premium redirection a charge of Rs 250 per request or a reduced charge of Rs 25 per request (if executed through the company’s web portal) will be charged. First 4 partial withdrawals, 4 fund switches and 4 premium redirections in a policy year are free.
The policyholder can avail the settlement option to get maturity benefits in installments, subject to certain conditions.
|Example||Payout Frequency||Settlement Period||Total number of installments||Proportion of units redeemed per installments|
Disclaimer: This article is intended to provide information about the plan in an easy to understand way. For more details visit the official web site of HDFC Life Click 2 Wealth Plan.
Anish L J is a ‘Financial Planner’ and member of Chartered Insurance Institute(CII), London and Insurance Institute of India. He is also a finance, insurance and software consultant. He thoroughly follows the developments in finance, insurance, and other related sectors.