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Calculation of yearly additions (in case of Death) in Life Insurance policy

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20 Jul, 2021 by  Karan Sakhuja

I lost my father recently and I applied for a claim (Kotak Life Insurance).

There were 3 components making up the claim amount (that I could understand from their literature and policy wordings):

Basic death benefit : no mismatch in claimant and insurer calculations

Term Rider : no mismatch in claimant and insurer calculations

Guaranteed Yearly addition : ---calculated incorrectly---


Here the mismatch between insurer and my calculations was :

  • my father passed away in April (the 10th month) of policy year 7 (policy tenure is June to June)
  • Guaranteed yearly additions that the insurer is calculating is as per 'end of policy year 6' and not as per 'end of policy year 7 (since that would have ended on paying 8th premium)'
  • Am i eligible to claim the end of policy year 7 amount? or the 10 month pro-rata value?
  • the policy document has no clarity on the term 'end of policy year'


Kindly note: I have already received the major claim amount and only the mismatch amount is what I am trying to understand and contest.



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20 Jul, 2021
Manoj Kumar Pandey

Pl share the date of the start of the policy & the date of death of your father.

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20 Jul, 2021

The guaranteed annual bonus is added to the policyholder's fund at the end of a policy year. In your case, I understand that your father passed away 2 months before completion of 7 policy years. If that's correct, your policy is eligible for only 6 years' annual guaranteed additions/bonus.


As requested by Mr Manoj Pandey, please share the policy inception date & date of death of your father. This would help us give you an explicit Yes/No.


My condolences on the passing away of your father.


Asad Akbar

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22 Jul, 2021
Karan Sakhuja

Dear Asad and Manoj sirs, appreciate your help here. As required by you, below are the details:


Plan Name: Kotak Assured Savings Plan(UIN-107N081V01)


Date of Commencement: 20/06/2014

Policy Term: 15 years

Premium Payment Term: 10 years


Date of Death: 15 Apr 2021


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23 Jul, 2021

Dear Karen


Condolences to the family on your father's demise.


Thanks for sharing the policy inception dates and date of death. As suggested by Mr. Asad & Mr. Manoj the guaranteed addition would be paid for every completed policy year which is 6 in this case. I believe the insurer has made the correct t calculation of claim amount.


Hope this addresses your concerns


Stay Safe

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