Good or Bad? A Detailed review

Bajaj Allianz Life Assured Wealth Goal Platinum is a non-linked, non-participating, individual life insurance, savings plan.

Bajaj Allianz Life Assured Wealth Goal Platinum protects you with a life cover while offering you an assured income to meet your immediate as well as future needs.

• Ensure financial security for your family with a life cover.
• Choose between two plan options: Smart Income and Regular Income.
• Enjoy guaranteed benefits throughout the policy term.
• Start receiving income as early as the second policy year.
• Benefit from tax advantages as per current tax regulations.

Maturity benefit

On maturity, the Regular Guaranteed Payouts expressed as a percentage of the Annualized Premium will be paid over the chosen Income Period. Additionally, get Enhanced Return of Premium (ROP) at the end of the Income Period.

There is no life cover during the Income Period. The Regular Guaranteed Payouts will continue to the nominee even if the life assured dies during the Income Period.

Death benefit

You will have life cover during the Bajaj Allianz Life Assured Wealth Goal Platinum Plan Policy term (life cover is not available during the income period). On Death the Sum Assured on Death plus Accumulated Guaranteed Pay-out (AGP), if any shall be payable to the nominee as a lump sum.

At no time, the death benefit minus AGP, if any will be less than 105% of the Total Premiums paid as on the date of death, or the prevailing surrender value, whichever is higher.

Maturity benefit

On maturity, the Regular Guaranteed Payouts expressed as a percentage of the Annualized Premium will be paid over the chosen Income Period.

Additionally, depending on the income period chosen, you can get an Enhanced ROP at the end of the Income Period.

There is no life cover during the Income Period. The Regular Guaranteed Payouts will continue to the nominee even if the life assured dies during the Income Period.

Death benefit

You will have life cover during the Bajaj Allianz Life Assured Wealth Goal Platinum Plan Policy term (life cover is not available during the income period). On Death, the Sum Assured on Death shall be payable to the nominee as a lump sum.

At no time, the death benefit will be less than 105% of the Total Premiums paid as on the date of death, or the prevailing surrender value, whichever is higher.

Grace Period

The Grace Period is thirty (30) days for frequencies other than monthly and fifteen (15) days for monthly frequencies during which the Policy is considered to be in force with the risk cover.

Discontinuance

If you have not paid at least one (1) full year’s premium then, your policy will immediately and automatically lapse at the expiry of the grace period and no benefit other than AGP, if any, will be payable under the Bajaj Allianz Life Assured Wealth Goal Platinum policy

If at least one (1) full-year premium has been paid and subsequent premiums are not paid (i.e. the policy which acquired a surrender value) the policy shall not lapse by reason of the nonpayment of future premiums, instead, the policy will be, immediately & automatically, converted to a paid-up policy at the expiry of the grace period.

Revival

You can revive your lapsed or paid-up policy within five (5) years from the due date of the first unpaid premium but before the end of the Bajaj Allianz Life Assured Wealth Goal Platinum policy term.

In the event you disagree with any of the policy terms or conditions, you shall have the option to return the policy within thirty (30) days beginning from the date of receipt of the Policy Document, whether received electronically or otherwise.

You can surrender the policy at any time during the Bajaj Allianz Life Assured Wealth Goal Platinum policy term after completion of the first policy year provided one full year’s premium has been paid.

The Policy will acquire a Surrender Value (i.e. Special Surrender Value SSV) after completion of the first policy year provided one full-year premium has been received.

The Bajaj Allianz Life Assured Wealth Goal Platinum Policy will acquire a Guaranteed Surrender Value provided two (2) full years’ premiums have been paid.

• Choose to accumulate the Early Guaranteed Payouts instead of receiving them as annual payouts.
• Enhance your coverage with optional rider benefits for added protection.
• Flexibly change the premium payment or income frequency on any policy anniversary.
• Access a policy loan of up to 80% of the surrender value, if needed.
• Option to receive the Regular Guaranteed Payouts and Enhanced ROP as a lump sum at a discounted rate anytime during the policy term.

• Income payouts may lead to unnecessary discretionary spending.
• The sum assured may fall short of meeting your family’s future financial needs.
• Early payouts hinder the power of compounding, reducing long-term wealth accumulation.
• The plan lacks a maturity benefit. It just returns the premium paid which may be insufficient for larger financial goals.
• The life cover ends with the premium payment term and does not continue during the income benefit period.

The Bajaj Allianz Life Assured Wealth Goal Platinum Plan allows you to pay premiums for a limited period and receive regular income either after a deferment period or as early as the second policy year.

Let’s analyze the plan’s benefit illustration to understand its cash flow pattern and estimate the returns.

A 35-year-old male opts for the Regular Income plan under Bajaj Allianz Life Assured Wealth Goal Platinum with a 12-year term and a 10-year premium payment period.

The annual premium is ₹1 lakh, and the income payout period spans 30 years, beginning from the 13th policy year.

The Bajaj Allianz Life Assured Wealth Goal Platinum policy offers an annual income of ₹1,00,800 for 30 years, along with an Enhanced Return of Premium (₹11 lakh) payable with the final instalment.

This results in an Internal Rate of Return (IRR) of 6.33% as per the Bajaj Allianz Life Assured Wealth Goal Platinum maturity calculator.

While the return may initially appear reasonable, it falls short for a long-term investment spanning a total of 42 years (12 years policy term + 30 years payout period). Over time, the income payouts lose value due to inflation, eroding purchasing power.

Additionally, regular payouts disrupt the compounding effect, significantly limiting wealth accumulation. Consequently, the Bajaj Allianz Life Assured Wealth Goal Platinum Plan may not be an effective investment option for achieving long-term financial growth.

The returns analysis of the Bajaj Allianz Life Assured Wealth Goal Platinum Plan may not appeal to long-term investors. To achieve better returns, consider separating insurance and investment.

This approach enhances both returns and liquidity. Let’s explore an alternative strategy.

Using the same annual premium of ₹1 lakh, allocate funds for insurance and investment separately.

Opting for a pure term life insurance policy with a sum assured of ₹7.5 lakhs, cost an annual premium of ₹6,600, with a 12-year policy term and a 5-year premium payment period.

The remaining ₹93,400 is invested to build a corpus.

An ELSS fund is chosen for investment. For the first 5 years, the balance after the insurance premium is invested, while in the next 5 years, the full ₹1 lakh is directed into the ELSS.

At the end of 12 years, the ELSS fund grows to ₹23.61 lakhs. After deducting capital gains tax, the post-tax maturity value is ₹21.40 lakhs. This corpus is then invested in an instrument yielding a 7% annual return.

To match the benefits of the Bajaj Allianz Life Assured Wealth Goal Platinum Plan, an annual withdrawal of ₹1,00,800 is made for 30 years, with the remaining corpus withdrawn as a lump sum at the end. This cash flow results in an IRR of 8.03%.

If withdrawals are deferred, the corpus can compound further, providing even better returns. This strategy offers liquidity and flexibility, allowing you to access your funds as needed, unlike the rigid payout schedule of the Bajaj Allianz Life Assured Wealth Goal Platinum Plan.

The Bajaj Allianz Life Assured Wealth Goal Platinum Plan offers survival benefits and a lump sum return of premium at maturity, which may seem appealing. However, the investment returns are not favourable for long-term goals.

Moreover, the sum assured is insufficient and does not extend during the income payout period.

While the plan guarantees benefits, neither the annual survival payouts nor the lump sum amount is adequate for achieving significant financial objectives.

As a result, investing in the Bajaj Allianz Life Assured Wealth Goal Platinum Plan may not be a beneficial choice and it also has a high agent commission.

Before starting your investment journey, securing sufficient life insurance coverage is essential. Pure-term life insurance policies provide comprehensive protection at affordable premiums.

Additionally, building a diversified investment portfolio can help you meet your financial goals efficiently.

When it comes to financial advice, are Quora, Facebook, and Twitter the final word?

For tailored advice on insurance and investment planning, consult a Certified Financial Planner. They can design a personalized financial strategy aligned with your risk tolerance, investment horizon, and life goals.