state life

what is option A&B in state life?

OPTION A&B

option -A; Automatic paid up

option-B; Automatic Premium loan

provided the surrender value of the policy exceeds the total of due premium(s) remaining unpaid and any other amount owed to state life.the option can be exercised at the time of taking the policy or at any time thereafter while the policy is in force. the option can be changed subsequently by written intimation to an endorsement in the policy by state life, so long as now, premiums remain unpaid beyond the grace period. if no option has been exercised by the policyholder, benefits under automatic paid up option will apply.

  • Automatic paid-up Option

This policy will be converted into a paid-up policy. The paid-up sum insured will be specially calculated to allow for the clearance of all outstanding dues of State Life against the policy.

No further premium (s) will be payable but the sum insured will be reduced. Any bonuses attached to the policy will be taken into consideration while determining the paid-up sum insured. A policy once paid-up will not be entitled to any further bonuses. If the specially calculated paid-up sum insured works out to be less than Rs.100 the policy will not be converted into the paid-up but will be treated as having been forfeited losing all benefits. A policy, thus made paid- up may be revived for full sum insured as per provision of condition No.4 above.

B-Automatic Premium Loan Option;

So long as the net surrender value of the policy equals or exceeds any due premium remaining unpaid beyond its grace period, State Life will continue to keep this policy in full force and treat the said by creating an automatic premium loan against the net surrender value of the policy.

When the net surrender value of the policy becomes less than a due premium remaining unpaid beyond its grace period, the policy will be kept in full force for a further broken period. This broken period will bear the same proportion to the full period of the unpaid premium as the net surrender value bears to the unpaid premium. The policy will automatically be forfeited and lose all benefits at the expiry of the said broken period.

Profit or return will be charged an automatic premium loan rates determined by the State Life from time to time. So long as an automatic premium loan along with profit or return is outstanding against this policy, the payment received by state life will be the first to be applied to reduce this debt.

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