Mutual Funds (MF) are one of the best investment vehicles to create wealth in the long run. And Systematic Investment Plan (SIP) the best way to invest in them. What if the Mutual Fund companies start offering free insurance with MF SIPs in their schemes! According to me it’s an excellent opportunity to start doing SIP and enjoy the free life Insurance.
This post talks about one such product – Birla Sunlife Century SIP (CSIP). I would soon write about other AMCs like Reliance and Kotak offering free life insurance with their schemes.
Birla Century SIP as the name suggests gives you a cover of up to 100 times your monthly SIP.
Below are the details:
Investment Amount In Century SIP:
Minimum: Rs. 1000 per month
Maximum: No upper limit
Investors should note that once CSIP is availed, CSIP amount cannot be changed through the tenure of SIP.
Minimum Age at entry: 18 Years
Maximum Age at entry: 46 Years
In case of joint unit holders in the scheme, only the first unit holder would be eligible for the insurance cover.
Non Resident Indians (NRIs) and Persons of Indian Origin (PIOs) are elligible to invest in Birla Sun Life Century SIP subject to fulfillment of certain additional criteria.
Tenure Of Century SIP:
Maximum Tenure: 55 Years less the current completed age of the investor
e.g. For an investor at the age of 40 yrs 5 months, tenure of Century SIP shall be a period of 14 years and 7 months i.e. period remaining for the attainment of 55 yrs of age.
Discontinuation Of Century SIP:
The Century SIP can be discontinued under following circumstances:
- Investor intimates the AMC to discontinue Century SIP, or
- Investor defaults Century SIP installments for two consecutive months during the tenure of the Century SIP, or
- Investor defaults Century SIP installments for four separate occasions (months) during the tenure of the Century SIP
There shall be no provision to revive the Century SIP, once discontinued
Load Structure under Century SIP would be:
Entry Load: Nil
Exit Load: As applicable to respective schemes
In the unfortunate event of death of the investor, there is no exit load.
Life Insurance Details:
Amount of Life Insurance Cover:
- Year 1 : 10 times the monthly Century SIP installment
- Year 2 : 50 times the monthly Century SIP installment
- Year 3 on wards : 100 times the monthly Century SIP installment
All the above mentioned limits are subject to maximum cover of Rs. 20 lacs per investor across all schemes/plans/folios.
If Century SIP discontinues, the insurance cover would be as follows:
- Century SIP discontinues before 3 years: Insurance cover stops immediately
- Century SIP discontinues after 3 years: Insurance cover equivalent to the value of units allotted under Century investment at the start of the each policy year, subject to a maximum of 100 times the monthly installment.
Commencement Of Insurance Cover:
The Insurance cover will start from the commencement of Century SIP. However, only accidental deaths will be covered for the first 45 days.
Cessation Of Insurance Cover:
The insurance cover shall cease upon occurrence of any of the following:
- At the end of the tenure. i.e., upon completion of 55 years of age.
- Discontinuation of Century SIP installments within 3 years from the commencement of the same
- Redemption / switch-out (fully or partly) of units purchased under Century SIP before the completion of the Century SIP tenure
Exclusions For Insurance Cover:
No insurance cover shall be admissible in respect of death of the unit holder (the insured investor) on account of –
- Death due to suicide within first year of commencement of Century SIP
- Death within 45 days from the commencement of Century SIP installments except for death due to accident
- Death due to pre-existing illness, disease(s) or accident which has occurred prior to commencement of Century SIP
Schemes Available for Century SIP:
There are 23 schemes available for investment:
- Birla Sun Life Infrastructure Fund
- Birla Sun Life MNC Fund
- Birla Sun Life Basic Industries Fund
- Birla Sun Life India Opportunities Fund
- Birla Sun Life India GenNext Fund
- Birla Sun Life Dividend Yield Plus
- Birla Sun Life Commodity Equities Fund
- Birla Sun Life India Reforms Fund
- Birla Sun Life Small & Midcap Fund
- Birla Sun Life 95 Fund
- Birla Sun Life Advantage Fund
- Birla Sun Life International Equity Fund
- Birla Sun Life Special Situations Fund
- Birla Sun Life Tax Plan
- Birla Sun Life Equity Fund
- Birla Sun Life Index Fund
- Birla Sun Life Freedom Fund
- Birla Sun Life Midcap Fund
- Birla Sun Life New Millennium
- Birla Sun Life Frontline Equity Fund
- Birla Sun Life Tax Relief 96
- Birla Sun Life Top 100 Fund
- Birla Sun Life Buy India Fund
To invest or not?
I think its a good offering from Birla Sunlife Mutual Fund. There are some funds like Birla Sun Life Dividend Yield Plus, Birla Sun Life Midcap Fund, Birla Sun Life Frontline Equity Fund which are top rated funds. So if you were planning to invest in any of their schemes, taking Century SIP route is a great idea!
You can download Birla Sunlife Century SIP at their website here.