ICICI Pru Elite Wealth Review
Plan Name: Elite Wealth
Category: Unit Linked Insurance Plan
Objective: Financial protection of family and good return on investment
ICICI Pru Elite Wealth Plan is a Type I ULIP which means that under the death clause, you are entitled to either Sum Assured or Fund Value whichever is higher.
Elite Wealth allows you to pay for a short term and choose longer policy period. There are also a few investment plans available with the plan.
Benefits of ICICI Pru Elite Wealth
Maturity: The fund value along with loyalty additions is paid on maturity date.
Loyalty Addition: Bonus additions will be added every year from the end of 6th policy year.
Flexible Sum Assured: For One Pay option, increase and decrease in Sum Assured is allowed.
Settlement Option: Instead of lump sum amount on maturity, you can choose to receive the amount in installments over the next few years.
Eligibility for ICICI Pru Elite Wealth
Minimum Entry Age: 0 Years (One Pay), 8 Years (Five Pay)
Maximum Entry Age: 70 Years
Maximum Age at Maturity: 80 Years
Policy Term: 10 to 30 Years
Premium Paying Term: One Pay, Five Pay
Minimum Premium: Rs 500,000 Annual Mode
Returns in ICICI Pru Elite Wealth
Any ULIP’s performance is directly dependent on the performance of the fund which in turn depends upon equity and debt market. If the market is rising, it will automatically reflect on your returns.
ICICI Pru has seven funds available ranging from conservative to aggressive. If you have higher risk appetite and are for long term you can opt for aggressive fund. On the other hand, if you have limited investment period, you should go for conservative fund.
In a typical scenario, you will be able to get at least 10% return on investment. The investment risk is borne by the policyholder.
What charges does ICICI Pru Elite Wealth deduct and how much?
The premium amount paid by you is not invested directly. Initially, some charges are deducted and then units of the fund are bought. The rest of charges are deducted by cancellation of the units.
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. For One Pay, premium allocation is 3% of single premium and for Five Pay; it is 2% of premium amount.
Fund Management Charge: The annual charge is 0.75% for money market fund and is 1.35% for all other funds.
Policy Administration Charges: These will be charged for the first five policy years.
Mortality Charge: These are charges deducted as a part of life cover provided and are recovered through cancellation of units.
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 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 Future Protect is Rs 2,000.
Switch: Switch is made to transfer the fund value from one fund to another. All switches are free of charge.
Partial Withdrawal: If policyholder is above 18 years and the minimum amount is Rs 2,000 and maximum amount is 20% of fund value. You can make partial withdrawal per year and is free per year.
Grace period: Elite Wealth can be renewed within 30 days from the premium due date. Additional 30 days are given after notice has been sent to revive or discontinue the policy.
What to do?
To Cancel Policy: Elite Wealth 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.
If you want to cancel policy after the initial period of 15 days, you can do it but the amount will be paid only after lock in period years. If you cancel policy within 5 years from inception, the amount will grow at interest rate of 3.5% compounded annually. After five years, if you cancel the policy, there will be no cancellation charges and amount will be paid immediately.
Compare Returns in Investment Plans!!
How much will you get?