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Knowledge Base Life Insurance Investment / Pension Bajaj Allianz Max Advantage Review
Tuesday, 31 May 2011 18:13

Bajaj Allianz Max Advantage Review

Written by  Yashish Dahiya
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Bajaj Allianz Max Advantage Review 


Plan Name: Max Advantage

Insurer: Bajaj Allianz Insurance Company Limited

Category: Unit Linked Insurance Plan

Objective: Financial protection of family and good return on investment


Major USP of Max Advantage: 


  • Highest Unit price guaranteed at maturity
  • 60% return of allocation charges
  • Flexible premium payment term.
  • In-built accidental death rider

 

Age eligibility of Max Advantage: 


Minimum Entry Age - 8 Years

Maximum Entry Age - 60 Years

Minimum Age at Maturity-18 Years

Maximum Age at Maturity  70 Years

Policy Term - 10 Years


Premium Options in Max Advantage:


Minimum Regular Premium: Rs 25,000

Maximum Regular Premium: Rs 200,000

Premium Paying Term- 5 to 7 Years

Premium Payment Frequency: Yearly

Life Cover in Max Advantage:


Minimum Sum Assured – 10 times of Annualized Premium for entry age below 45 years

7 times of Annualized Premium for entry age 45 years & above

Maximum Sum Assured - 10 times of Annualized Premium


What benefits does Max Advantage offer?


Death benefit:

In case of death of the life insured, the opted Sum Assured and the fund value as on date of intimation of death is paid to the designated nominee. If the life insured nature of death is accidental, additional Sum Assured is paid.

 

Maturity Benefit:

The fund value as on maturity date is paid to the policyholder.

Highest NAV: If any portion of premium is invested in Max Gain Fund II, then the fund value based on highest NAV achieved during the policy term is paid on maturity.


Guaranteed Addition:

An amount equal to 60% of the allocation charge is also paid if all due premiums have been paid regularly.


Flexibility in Premium Payment Term:

You have the option to change the premium paying term from 5 years to 7 years.


How is my money invested in Max Advantage? What’s the risk?


The premium you pay after the deductions is invested into different funds. The funds have different risk probability- some funds invest in debt market which is safer while some funds invest in equity market which is risky but probability of higher returns is more. There are funds with mixture of equity and debt to balance the risks. 

 

The funds available are:

Max Gain Fund II (closed from 31/03/2011)

Asset Allocation Fund                        High Risk

Equity Index Fund II                          High Risk

Bond Fund                                        Moderate Risk

Liquid Fund                                       Low Risk

 

 

Compare Returns in Investment Plans!!

How much will you get?

get_quote


What will be my returns from Max Advantage?


The important question that customer wants answered is “What will be my returns in Max Advantage?” Let us take an example:

Vinayak aged 30 invests Rs 45,000 for term of 7 years. He gets insurance cover of 450,000.

Assume fund value after four years is Rs 200,000.


Death Benefit:

If Vinayak passes away after four years, his wife will get Sum Assured and fund value.


Maturity Benefit:

Vinayak gives in total amount of Rs 225,000 to Bajaj Allianz. At maturity, assuming growth of 10% only, the amount he will get is approximately Rs 519,662. The maturity amount could be more depending on the money market scenario. Longer terms typically provide good returns.


Are there any tax benefits?


Under Section 80C you can avail tax benefit, yearly premium (not more than 1lac) will be deducted from taxable income.

Under Section 10(10D) death claim is completely tax free.


What charges does Bajaj Allianz Max Advantage deduct and how much?


Premium Allocation Charges: These charges are deducted as percentage of premium. Insurer deducts these charges on account of expenses incurred by the company – medical examination, policy issuance, underwriting bills. Premium allocation charges are 10% for first year and 3.75% from 2nd year till the 5th year.


Fund Management Charge: These are the charges levied as a percentage of fund value to manage the funds. The premium paid is allocated into different portfolio of funds. The charges are 1.25%for asset allocation fund and equity index fund II and 0.95% for liquid fund and bond fund.

 

Policy Administration Charge: These are monthly deductions by the insurer for maintaining the policy- paperwork, work force etc.  They are recovered through cancellation of units 2nd year onwards until the end of policy term. Max Advantage has administration charges of 3% of annual premium.

 

Mortality Charge:

These are charges deducted as a part of life cover provided and are recovered through cancellation of units.


What else should I know about?


Top-Up premium: This is the additional premium which can be added above the usual premium to get more units if you think the particular fund is providing good returns. Top-Up can be made after 1st policy year and not in last 5 policy years. The minimum Top-Up in Max Advantage is Rs 5,000.

 

Switch: Switch is made to transfer the fund value from one fund to another. You can make any number of switches in Max Advantage free of charge but the minimum amount to be switched is Rs 5000.

 

Premium Re-direction: This option lets you direct the further premiums into different fund. At policy anniversary, you can allocate funds in whatever fund you want.

 

Partial Withdrawal: If policyholder is above 18 years and the minimum amount is Rs 5000 and amount equal to two years premium shall always be maintained.

 

Grace period: Max Advantage can be renewed within 30 days from the due date.

 

Free Look Period: Max Advantage plan can be cancelled within 15 days of receiving the policy contract. A written application can be submitted to any branch for the same. The premium will be paid back minus some charges like stamp duty, medical reports.


How can I buy Max Advantage?


Max Advantage is available online; the process is fast and simple. Within few minutes, your application will be submitted and policy will be issued accordingly.


What’s Policybazaar opinion on Bajaj Max Advantage?


Max Advantage is a good plan which returns your majority of allocation charges at the end of the term. You have to pay premium for just 5 years which is attractive for customers looking for short term investment plan. Accidental rider is inbuilt which adds to the security of the policyholder. The charges are also not much so more money gets invested.  However the fund called Max Gain Fund II has been closed after March 31, 2011 as it was limited time offer.

 

Compare Returns in Investment Plans!!

How much will you get?

get_quote

 

 

 

 

 

 

 

 

 

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