Section 30 in Insurance Regulatory and Development Authority of India (Unit Linked Insurance Products) Regulations, 2019
30. Computation of Net Yield for demonstration in product filing documents.
(a)Mortality and Morbidity charges may be excluded in the calculation of the net yield.(b)Extra premium due to underwriting emanating from extraordinary health conditions, cost of all rider benefits, tax on charges (as applicable) and any explicit cost of investment guarantee shall be excluded in the calculation of net yield. The calculation of all charges shall be as per product filing document.(c)The net yield shall be calculated based on the projection of end fund on monthly basis at a stipulated gross rate of return assuming the mortality and morbidity charges as zero throughout the term of the contract and premiums are paid as and when due. The equation of value concerning the gross premium paid by the policyholder and the fund value at the end of the policy year of demonstration shall give the effective net yield per annum expected to be earned on the contract at the point of sale.(d)As the policyholders' behaviour with regard to options under Unit Linked insurance products, for example, partial withdrawals, premium redirection, switches, settlement options, top up premium etc. affect the net yield; such options may be ignored throughout the term of the contract of demonstrating the net yield.
