ICICI Prudential Future Perfect Plan (ICICI Prudential Life Insurance) Review. ICICI Prudential Life Insurance Benefits & Drawbacks.

ICICI Prudential Future Perfect Plan, one of ICICI Prudential Life Insurance Review. ICICI Prudential Life Insurance Benefits, amount get added as a Guaranteed and its Drawbacks. Is it a good deal?

Hello investors! Here we will discuss about ICICI Prudential Future Perfect Plan, one of ICICI Prudential Life Insurance and give one illustration along with one example. ICICI Prudential Life Insurance is an endowment plan. You will receive the guaranteed Benefits, non-guaranteed bonuses and the death benefits in case of the death of the policy holder.

Your premium payment term can be 5 years, 7 years, 10 years, 15 years, and 20 years. Ok, lets say we are choosing a 20 years of premium payment term in our case. So, the policy term will be twenty five to thirty. In between this we have to choose. So we are choosing as a twenty five. It's just for an illustration ok. And the maximum age in arrears of entries 45 years. And maximum age at maturity will be 70 years. So, all the data you an have a look.

Benefit of this plan is Guaranteed Benefits. We have two kind of guaranteed benefits which is called Guaranteed Maturity and Guaranteed Addition. And the other one is Non-Guaranteed Bonuses. So, they have Reversionary Bonuses and Terminal Bonuses. Let have a little bit of detail of these two benefits of this plan.

Guaranteed Benefits consist of Guaranteed Additions and Guaranteed Maturity Benefits. Guaranteed Addition get added to your policy each year. If your policy term is twenty years. This additions/this amount/this fix amount will get added each year for all your policy term and Guaranteed Maturity Benefit will get added to your policy only at the maturity.

How much amount get added as a Guaranteed?

Addition since the policy premium payment term is 20 years and policy term is 25 years, we will get 18% of an annual premium. It will get added per annum in our policy. And Non Guaranteed Bonuses consist of Reversionary Bonuses and Terminal Bonuses. Reversionary Bonuses get added every year of a policy. If it is 20 years, It will get added each year. At what rate ICICI Prudential Life Insurance will get added. It is define actually in an illustration that we will have a look. And Terminal Bonuses, is a one time bonus declared at the time of maturity. So, you will get this bonuses on a this bonus only during maturity of your ICICI Prudential Life Insurance.

Now, with this background lets have a look at the illustration. Suppose, you are 30 years old and you choose to invest in ICICI Prudential Life Insurance (ICICI Prudential Future Perfect Plan) with premium amount of ₹1,00,000 per annum. And you opted your payment duration of 20 years. So you will pay a premium for 20 years and your policy term will be 25 years. It will get mature after 25 years, as we have discussed it. So, the premium amount is ₹1,00,000 and premium payment frequency is annual. Payment duration is 20 years and policy term will be 25 years. So, total yearly premium will be Rs. One Lakh Four Thousand Five Hundred and One. It is after Addition of GST charges, the Guaranteed Benefits, you will receive. It is a addition of Guaranteed Maturity Benefit and Guaranteed Addition.

ICICI Prudential Life Insurance Estimated Bonuses or Non Guaranteed Bonuses are ₹26,46,231 in the best case scenario of 8%. It is assumed rate of return of 8%. You will get this much of bonuses. If it is 4%, you will receive ₹7,35,517. So, you see the difference. 26 lakhs in 8% and 7 lakhs in 4%.

Since it is a Non Guaranteed Bonus, it may go even lower than 4%. But it is Guaranteed in this case is, Guaranteed Benefits are guaranteed. And assured sum is, for example, if you are paying ₹1,00,000 for 20 years, sum assured is ₹16,95,386. Even if nothing happen, you will definitely receive this amount. This is a breakdown of a guaranteed Benefit and this is how you get ₹20,60,386. There is a detail, so you can click on the detail in ICICI Prudential Life Insurance official website and you will see all this breakdown.

If we are calculate the IRR, the average Rate of Return. So, you are paying your premium for 20 years along with GST. After 25 years, your policy get matured. There is a Guaranteed Maturity Benefit. You will receive ₹16,95,386 and there is a Guaranteed Addition. It is ₹3,65,000 and that will added to your policy each year.

The sum of ICICI Prudential Life Insurance Guaranteed Addition and Maturity Benefit, you will receive at the Maturity. And Estimated Bonuses at the best case scenario of 8%. ARR is your Assumed Rate of Return at 8% is ₹26,46,231. So, in this best case scenario, you will get this much of Bonus. If you calculate the average rate of return, you will get only 7%. In 25 years of long policy, you are receiving the IRR of 7%.

Lets have a look at this Reversionary Bonuses. So, we are talking about Reversionary Bonuses at 4% to 8%. But, since last three years, It has been only 2%/2.5%. In 2019 it is 2.25% only. It actually varies each year.

So, what is the final verdict?

Though ICICI Prudential Life Insurance policy uses catchy words such as "Guaranteed Benefits" or "Future perfect", but in reality, it is not true. You are just receiving but you are paying. Even less than that. So, in the base case scenario, you may or may not receive ₹47 lakhs. What ever they are paying maturity, that is after 25 long years. So, it is not guaranteed. What ever is mentioned in the online calculator, if you pay Rs. 1,00,000 premium for 20 years, you will receive the assured sum of ₹16,95,386. So, you are paying 20 lakhs and more and you are receiving the assured sum of only this much. This is the only Guaranteed they are giving.

Do you think it is a good deal?

So, anyway in short, you should avoid investing in ICICI Prudential Life Insurance policy and plan for the better use of your money.

So, have you been thinking what is the solution?

You should start investing in PPF or Mutual Fund. So it is like define below, ₹1,00,000 in PPF for 20 years, you will receive the guaranteed returns of ₹49,42,292 at 8%. It is a Guaranteed a rate of return. This much you will receive from PPF in 20 years.

And, if you invest in any good Equity Mutual Fund, and the same amount after 20 years, will fetch you Rs. 85 lakhs. At the average rate of return of 12%. So, you should consider investing in such policies instead of choosing, in this endowment policies, such as ICICI Prudential Life Insurance or something similar to that.


I think I have clarified all your doubts in this. So, still if you have any specific queries on ICICI Prudential Future Perfect Plan, feel free to ask them in the comment below.