Birla Sunlife has recently launched a new savings cum insurance plan. The plan offers guaranteed additions for first 5 years provided all premiums are paid. The guaranteed addition is equal to 40 per thousand. The Plan offers only three terms i.e. 10, 15 and 20 years. Premium paying term can be regular for 10 years term, 10 years in case of 15 year term and 10 or 15 years term for 20 year policy term. Minimum entry age in the plan is 18 years and maximum is 50 years. Minimum sum assured is 30,000 and maximum sum assured is Rs. 10lakhs. The plan also gives the option of choosing four different options for payment i.e. yearly, half yearly, quarterly and monthly. The policy holder gets rebate of 3% in case of annual payments.
The points to know this before investing. The return is very poor as illustrated below. The same can be understood with the help of following example. If a 35 years healthy male takes this plan for sum assured of Rs. 1lakhs, then his annual premium will be Rs. 7,267/- exclusive of service tax. He will get guaranteed amount of the sum assured i.e. Rs. 1lakh at maturity and plan also may give non guaranteed bonus which is assumed in the illustration at 4% and 8% p.a. The IRR is only 4.20% considering return on investment @8% p.a. which is calculated with the help of excel and using IRR formula. The detail is as under. The premium is taken inclusive of service tax.
|
Year
|
Premium
|
|
1
|
-7492
|
|
2
|
-7379
|
|
3
|
-7379
|
|
4
|
-7379
|
|
5
|
-7379
|
|
6
|
-7379
|
|
7
|
-7379
|
|
8
|
-7379
|
|
9
|
-7379
|
|
10
|
-7379
|
|
11
|
-7379
|
|
12
|
-7379
|
|
13
|
-7379
|
|
14
|
-7379
|
|
15
|
-7379
|
|
16
|
-7379
|
|
17
|
-7379
|
|
18
|
-7379
|
|
19
|
-7379
|
|
20
|
-7379
|
|
21
|
234000
|
|
IRR
|
4.20%
|
