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Questions and Answers.
What is the 5-Year Future Premium Benefit?
The 5-Year Future Premium Benefit is an amount that, together with the value of the Long and Short Term Pockets, Old Mutual pays to your nominated beneficiaries or estate upon death of policyholder within 5 years from the start of the Plan.
- This benefit is equal to the net premiums that you would have invested in your Long Term Pocket from the date of your death, until the end of the first 5 years of the Plan.
- The 5-Year Future Premium Benefit expires after year 5, even for the 10-year plan.
- In the event of death of the policyholder due to Non-Accidental causes, there is a 6 month waiting period from the start of the Plan during which Old Mutual will only pay the Money Back Guarantee.
For a total monthly premium of 5 000, the table below illustrates how the 5-Year Future Premium Benefit will change over time.
FUTURE PREMIUMS BENEFIT OVER TIME
Future premiums benefit
Can I miss, reduce or stop paying my monthly premiums?
Yes. Ideally this option would be used as a last resort. When you miss, reduce or stop paying premiums or surrender or make part withdrawals from the Plan, you will have to pay certain charges.
- If you miss a premium, the Policy will enter a grace period of 45 days during which time you will still have death cover. If death occurs during the grace period, any outstanding risk premium will be deducted from the death benefit due to the ‘no premium, no cover’ regulatory rule.
- If you do not pay a premium within the grace period, your Policy will enter a reinstatement period of 6 months during which time you can reinstate your premium payment. You will not have any 5-Year Future Premium Benefit during the reinstatement period.
- You can only reinstate the Plan 3 times during the Term of the Plan.
- If you completely stop paying your monthly premiums during the Term of your Plan, you can take out the accumulated value in both Pockets or keep it invested, subject to certain conditions and charges being paid.
- You may request to decrease your premium, subject to the minimum premium applicable at the time of your request.
What will be paid out?
If you survive until the end of the Term, we will pay you the total Fund Values of the Long and Short Term Pockets. In the event of death of the policyholder due to Non-Accidental causes, there is a 6-month waiting period from the start of the Plan during which Old Mutual will only pay the Money Back Guarantee (the amount equal to all premiums we have received under the Plan, less any withdrawals). No other benefits will be paid. In any other event of death before the end of the Term, we will pay the Fund Values of the Long and Short Term Pockets plus, where applicable, the 5-Year Future Premiums Benefit, plus any investment returns earned in the benefit accumulation fund after death, to your nominated beneficiaries or estate, as the case may be.
If you surrender your Plan, we will pay the Fund Values of the Short and Long Term Pockets. A surrender administration charge may be deducted depending on when the policy is surrendered during the term of the policy. You can also make part withdrawals from the Short and Long Term Pockets. A part withdrawal administration charge may be deducted depending on when a part withdrawal is taken during the term of the policy.
What taxes apply?
We will not deduct any personal taxes from the Fund Value during the Term or when it is paid. However, you may have to pay tax on the premiums or the benefit under any relevant laws of the Federal Republic of Nigeria. It is your responsibility to report and pay the correct tax.
Any return earned is net of a withholding tax, if applicable.
What if I change my mind after applying for the Plan?
You have the right to cancel your application within 30 days of the Policy Start Date (Review period). There are no charges on cancellation within this period. Cancellation after this period will result in you incurring charges.
Who are the beneficiaries of the policy?
Next of Kin
The Next of Kin is/are the person(s) nominated by the Policyholder/Insured Person to receive the proceeds in the event of the insured event occurring. It is unlikely that the Insured Person would want to nominate a Beneficiary for these “survival benefits”, however, up to 5 beneficiaries may be nominated. The Insured Person may revoke or change the beneficiary at any time during the term of the policy. The Policyholder may only nominate Beneficiaries of Proceeds if the Policyholder and the Insured Person are the same person.
If there is no valid beneficiary nomination, the benefit payment will be made to the Insured Person (or his or her estate where relevant).
Beneficiaries of Ownership
If the Policyholder and the Insured Person is not the same Person, the Policyholder may nominate a Beneficiary for Ownership to become the new Policyholder and as a result the new premium payer in the case of the death of the Policyholder.