Bharti AXA Life Insurance has launched its Bright Stars Edge and True Wealth. The period from January to March is the season for tax savings, and hence the rush of fresh ULIP offerings
Bharti AXA has launched its new Unit-linked Insurance Plan (ULIP) with new names, but carrying the same old charges. The 'fresh' offering has no new functionality.
There is no single premium option in these ULIPs. The charges of most of these new ULIPs are more than old ULIPs, when compared for 5 years or more; these ULIPs fall under the same category.
Bright Stars Edge offers the double benefit of sum assured and fund value release, should something unfortunate happen to you. But this results in increased mortality charges that are ultimately paid by the policyholder.
It offers several investment options with different mix of debt and equity. The policyholder can have 12 free switches each year. The charges are in-line with other new ULIPs offered post 1 September 2010 when compared for those ULIPs with 5-year duration, and on the higher side for duration of 10 years and beyond.
The True Wealth plan offer guarantees you the highest daily Net Asset Value (NAV) for the first 7 years on maturity with a minimum NAV guarantee of Rs12.
The policy duration is 10 years, but has limited premium payment term of 5 years, that allows funds to grow for 10 years after a minimum of 5 years of premium paid.
The highest NAV is not applicable in the event of the policyholder's demise before policy term or surrender of policy. There is only one investment option that has flexibility for the insurer to have equity from 0% to 100% and debt from 0% to 100%.
This is a typical highest NAV plan, wherein policyholders will not get great returns. It is for the conservative risk-averse investor. There will be some exposure to equity in the beginning of the policy term, but it will then be moved to debt.
The NAV guarantee of Rs12 is nothing spectacular. Even if we assume a starting NAV of Rs10, it is just 20% in 10 years. The charges are in-line with other new ULIPs offered post 1 September 2010 when compared for those with 10 years' duration.
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