Bajaj Allianz Money Secure ULIP: High charges, poor guarantee

New ULIPs have a big ticket size. But Bajaj Allianz has come out with a small ticket plan with high charges

Money Secure is a regular premium ULIP that provides security for your investment with guaranteed maturity benefits. The selling proposition is a minimum annual premium of Rs7,000, which is low compared to premiums for new ULIPs that are commonly high.

The maturity guarantee of net cash flow (premium paid, less all charges) accumulated at 3% per annum is pathetic and will result in investments mostly in the debt market. The equity allocation of 0% to 50% means there will be times when nothing will be in equity and hence the returns will be average.
Pension ULIPs like LIC's Pension Plus offer 4.5% per annum guarantee on gross premium (not net of charges) and are a far better option for conservative investors than the Money Secure plan. Most insurers have avoided pension ULIP products since the new regulations, even though the 4.5% per annum guarantee does not seem much, because of the uncertainty of  interest rates over the long term of such plans.

Money Secure has premium payment term (PPT) flexibility. For a policy term of 10 years, it is 5 to 10 years. For a policy term of 15 years, it is 10 to 15 years. According to Rituraj Bhattacharya, head - product development, Bajaj Allianz Life Insurance, "The policyholder has to make an informed decision about how long s/he wants to pay the premium. If the premium payment term chosen is 12 years for a 15 years policy term in Money Secure plan, then the premium payment obligation on the part of the policyholder ceases on payment of the 12th year's premium and the policy will remain in force for 15 years." PPT flexibility will help to continue the insurance cover and remain invested without paying premium after the period of PPT till the end of policy term.

The premium allocation charge is 10% for years one and two, 7% for year three through year five and 2% thereafter. The policy administration charge is nil for the first five years of the policy and Rs25 per month thereafter, inflating at 5% per annum annually. There is also a guarantee charge of 2% of premium when received by the company. All top-up premiums have an allocation charge of 2%.

The plan also has seven optional riders. There is an option to decrease the sum assured to the level of 115% of the regular premium paid, subject to the minimum allowed under the product; such reduction shall be allowed at policy anniversaries only.

The minimum sum assured for age less than 45 years is 10 times the annualised premium and seven times the annualised premium for others. The maximum sum assured is 10 times of the annualised regular premium for policyholders who opt for riders such as critical illness, hospital cash benefit or family income benefit and 20 times of the annualised regular premium for others.



Madhusudan Thakkar

6 years ago

This type of BOGUS product will be sold by SUPER AGENT.Better products will be available on ONLINE platform."MALAI" will be eaten by company and "CHUTNEY" will be offered to SUPER AGENT."MEWA" will be also be eaten by company and SUPER AGENTS will give SEWA.

All spectrum decisions since 2003-08 were wrong: Telecom panel

Quoting the report, telecom minister Kapil Sibal said the committee found that original spectrum allocation was "bad" and procedures were not followed both during the NDA government till 2004 and the UPA government up to 2008

New Delhi: All decisions on spectrum allocation since 2003 by successive governments, including the United Progressive Alliance (UPA), were procedurally wrong, concluded the one-man committee, which probed into the procedural lapses following the telecom scam, reports PTI.

Unveiling the report of the Shivraj V Patil committee, telecom minister Kapil Sibal said here today that the findings on procedural lapses are being sent to the Central Bureau of Investigation (CBI), which is looking into the criminal culpability in the scam.

Addressing a press conference a day after the arrest of former telecom minister A Raja, Mr Sibal said his predecessor had said that he was "not deviating from the previous policies (the National Democratic Alliance government) but the problem was that the previous policies were wrong."

Quoting the report, Mr Sibal said the committee found that original spectrum allocation was "bad" and procedures were not followed both during the NDA government till 2004 and the UPA government up to 2008.

It also said the Department of Telecommunications (DoT) did not follow the advice of the law ministry or the views of the finance ministry over pricing of spectrum.

The committee has also recommended reforms in allocation of spectrum and penalty on hoarding of the scarce natural resource.

The UPA government is battling, among others, a telecom scam with presumptive losses of over Rs1.76 lakh crore.

The former telecom minister has been arrested by CBI, which is investigating the case under the supervision of the Supreme Court.


PM approves formation of 12-member GoM on coal

The move comes in the backdrop of ever-widening demand-supply gap in coal, which is likely to touch 142 million tonnes (MT) next fiscal and classification of 203 coal blocks by environment ministry as 'no-go' zones

New Delhi: Prime minister Manmohan Singh has approved formation of a ministerial panel, headed by finance minister Pranab Mukherjee, to sort out environmental issues hurting coal production, reports PTI.

This comes in the backdrop of ever-widening demand-supply gap in coal, which is likely to touch 142 million tonnes (MT) next fiscal and classification of 203 coal blocks by environment ministry as 'no-go' zones.

"Prime minister Manmohan Singh has his given consent for the formation of a 12-member Group of Ministers (GoM), mainly to consider issues impacting coal production and development projects in the country," a top coal ministry official told PTI.

The panel has been asked to finalise its recommendations within two months.

The GoM includes coal minister Sriprakash Jaiswal, environment minister Jairam Ramesh, home minister P Chidambaram, steel minister Beni Prasad Verma, mines minister Dinsha Patel, power minister Sushilkumar Shinde and commerce minister Anand Sharma among others, the official said.

Other members of the GoM are agriculture minister Sharad Pawar, law minister Veerappa Moily, transport minister CP Joshi and deputy chairman Planning Commission Montek Singh Ahluwalia.

"The GoM will consider all issues relating to reconciliation of environmental concerns emanating from various developmental activities including those related to infrastructure and mining and finalise its recommendations within two months," the official said quoting notification.

It will finalise the recommendations which will include issues like efficacy and legality of forest clearance norms, damage to environment due to projects and afforestation steps.

It will also suggest whether changes are required in the existing laws and provisions.

Concerned over coal shortages faced by various sectors including the power, the prime minister has already asked the ministry of environment and forests to revisit the policy of 'no-go' and 'go' areas.

Earlier, the Cabinet on 13th January had approved formation of a GoM to solve the vexed issue of mining in 'no go' areas as classified by the environment ministry.

The coal and environment ministries had locked horns over the issue after the latter last year classified 203 coal blocks under 'no go' area prohibiting mining there, impacting 660 MT coal production per annum.

The coal shortage faced by the country this fiscal is 82 MT and is likely to soar to 142 MT next fiscal.

The coal ministry had said various companies had already committed Rs35,000 crore for end-use projects in lieu of coal blocks allotment.

It had also argued that this would augment about 1,30,000MW potential power generation capacity per annum.


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