What are the features of the ABSLI Vision Life Income Plus Plan?

 Flexibility to choose amongst three Benefit Options i.e. Short-Term Income, Long Term Income and Whole Life Income.  A regular flow of guaranteed income for your chosen Benefit Payout Period.  Flexibility to receive a cash value of Paid-Up Additions, (if any), in cash or accumulate them till policy maturity.  In case of an eventuality inbuilt benefit waives future premiums.

ABSLI Vision Life Income Plus Plan: Good Or Bad? An Insightful Review

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Can the ABSLI Vision Life Income Plus Plan provide a secure future for your family while offering guaranteed lifelong income, making it the ideal financial strategy?

Can ABSLI Vision Life Income Plus Plan offer both comprehensive life cover and the potential for wealth creation?

Could the ABSLI Vision Life Income Plus Plan be considered as a potential source of income?

Let’s discuss the features, advantages, disadvantages, and returns of the ABSLI Vision Life Income Plus Plan through an IRR (Internal Rate of Return) analysis. This evaluation will help us understand the plan’s cash flow pattern and assess the investment’s value.

What is the ABSLI Vision Life Income Plus Plan?

ABSLI Vision Life Income Plus Plan is a non-linked participating individual life insurance savings plan. ABSLI Vision Life Income Plus plan offers a blend of benefits Viz. income, savings and financial protection for your loved ones. ABSLI Vision Life Income Plus Plan provides access to liquidity even during the premium paying period.

What are the features of the ABSLI Vision Income Plus Plan?

Flexibility to choose amongst three Benefit Options i.e. Short-Term Income, Long Term Income and Whole Life Income.
A regular flow of guaranteed income for your chosen Benefit Payout Period.
Flexibility to receive a cash value of Paid-Up Additions, (if any), in cash or accumulate them till policy maturity.
In case of an eventuality inbuilt benefit waives future premiums

Who is eligible for the ABSLI Vision Life Income Plus Plan?

What are the benefits of the ABSLI Vision Life Income Plus Plan?

i.) Death benefit

Short-Term Income:

In case of death of the Life insured anytime during the ABSLI Vision Life Income Plus Plan Policy Term, the nominee /beneficiary will receive:

Sum Assured on Death; and,
Policy Continuance Benefit

Where “Policy Continuance Benefit” means:

All due future premiums, if any, coinciding with or following the date of death of the Life Insured shall be waived off;
Your ABSLI Vision Life Income Plus Plan Policy shall continue to participate in future bonuses until the end of the Policy Term;
Your Guaranteed Income Benefit shall continue to be paid on the due dates;
Accrued Paid Up Additions and Terminal bonus, if any, shall be payable at the end of the Policy Term.

Long Term Income:

In the event of death of the Life Insured during the ABSLI Vision Life Income Plus Plan Policy Term, nominee(s)/beneficiary(ies) will receive:

Sum Assured on Death; and,
Accrued Paid Up Additions (if any); and,
Terminal Bonus (if any)

Whole Life Income:

In the event of the death of the Life Insured during the ABSLI Vision Life Income Plus Plan Policy Term, the nominee /beneficiary will receive:

Sum Assured on Death; and,
Accrued Paid Up Additions (if any); and,
Terminal Bonus (if any)

For all the three Benefit Options, Sum Assured on Death shall be defined as higher of the following:

Sum Assured
11 times the Annualized Premium
105% of Total Premiums paid till the date of death

ii.) Survival benefit

Short-Term Income:

On completion of the Premium Payment Term, a Guaranteed Income Benefit of 1% of the Sum Assured will be payable at the beginning of every month during the Benefit Payout Period till the end of the ABSLI Vision Life Income Plus Plan Policy Term.

Long-Term Income:

On survival of the Life Insured till the end of the Premium Payment Term, a Guaranteed Income Benefit as a pre-defined percentage of the Sum Assured will be payable at the end of each ABSLI Vision Life Income Plus Plan policy year during the chosen Benefit Payout Period.

The table below gives the Guaranteed Income Benefit percentages for Annual Frequency

Benefit pay-out period	Guaranteed Annual Income as a Percentage of the sum assured
20 years	8.50%
25 years	7.00%
30 years	5.50%

Whole Life Income:

On survival of the Life Insured till the end of the Premium Payment Term, a Guaranteed Income Benefit as a pre-defined percentage of the Sum Assured, will be payable at the end of each year during the chosen Benefit Payout Period.

The Guaranteed Annual Income Benefit as a percentage of the Sum Assured will be as follows:

Premium Payment Term (years)	EntAge (years)	Maturity Age (years)	Guaranteed Annual Income as a %age of Sum Assured
8	All	85	2.95%
10			3.30%
12			3.65%
15			4.00%
8	Less than 45	100	2.52%
10			2.62%
12			2.72%
15			2.82%
8	45 and above	100	2.95%
10			3.30%
12			3.65%
15			4.00%

iii.) Maturity benefit

On survival of the Life Insured till the end of the ABSLI Vision Life Income Plus Plan Policy Term, the following will be payable:

Accrued Paid Up Additions (if any)
Terminal bonus (if any)

Under the ‘Whole Life Income’ Benefit Option, in addition to the above, the Sum Assured will be payable at the end of the Policy Term.

Grace period, Discontinuance and Revival of ABSLI Vision Life Income Plus Plan

Grace Period

A Grace Period of 30 days from the due date for payment of each premium for all premium paying modes except for monthly mode, where a Grace Period of only 15 days will be allowed.

Discontinuance

Discontinuance of Payment of Premium before the ABSLI Vision Life Income Plus Plan policy has acquired Surrender Value:

If You don’t pay the due premium during the Grace Period, the Policy shall Lapse w.e.f. the due date of unpaid premium, and all benefits under the policy, including the insurance cover, shall cease and no benefits shall be payable.

Discontinuance of Payment of Premium after the ABSLI Vision Life Income Plus Plan policy has acquired Surrender Value If You don’t pay the due premium during the Grace Period, the policy shall become a Reduced Paid Up (RPU) policy.

The RPU Sum Assured and RPU Guaranteed Income Benefit shall be equal to the Sum Assured and Guaranteed Income Benefit respectively, multiplied by the RPU Factor.

Revival

You can revive Your ABSLI Vision Life Income Plus Plan policy within a revival period of five years from the due date of the first unpaid premium.

Free Look period of ABSLI Vision Life Income Plus Plan

You will have the right to return your ABSLI Vision Life Income Plus Plan Policy within 15 days (30 days in the case of electronic Policy or the Policy issued under Distance Marketing) from the date of receipt of the Policy.

Surrendering ABSLI Vision Life Income Plus Plan

Your ABSLI Vision Life Income Plus Plan policy will acquire a Surrender Value after all due premiums for at least two full policy years are paid. The Surrender Value payable will be higher than the Guaranteed Surrender Value (GSV) and Special Surrender Value (SSV).

What are the advantages of the ABSLI Vision Life Income Plus Plan?

You may take a loan against your ABSLI Vision Life Income Plus Plan policy with a maximum of 80% of the surrender value.
Option to enhance Your insurance coverage through riders at a nominal extra cost.
Paid-up additions accrue from the end of the first policy year.
Life insurance coverage up to age 100 (under the whole life Income)

What are the disadvantages of the ABSLI Vision Life Income Plus Plan?

The income benefit tends to be used for discretionary expenses.
The plan lacks flexibility.
The income benefit remains standard throughout the term with no option for a step-up.

Research methodology of ABSLI Vision Life Income Plus Plan

The ABSLI Vision Life Income Plan offers three different variants, allowing you to choose a plan based on your income needs. To understand the cash flow pattern, we can analyse the benefit illustration provided in the policy brochure.

A detailed analysis, including numeric calculations of the Internal Rate of Return (IRR) and a comparison of returns, will help us make an informed investment decision.

Benefit Illustration – IRR Analysis of ABSLI Vision Life Income Plus Plan

Consider a 35-year-old male investing in the ABSLI Vision Life Income Plus Plan with a Sum Assured of ₹6,45,278. The premium payment term is 10 years, and the income benefit period is 20 years, totalling a policy term of 30 years.

The annual premium is ₹1 lakh. Under the Long-term Income benefit option, he receives an annual income of ₹54,849. The maturity benefit, which includes bonuses, is receivable at the end of 30 years along with the final income benefit payout.

Male	35 years
Sum Assured	₹ 6,45,278
Policy Term	30 years
Premium Paying Term	10 years
Annualised Premium	₹ 1,00,000

The illustrations show two different assumed rates of future investment returns: 8% p.a. and 4% p.a. These rates are not guaranteed and do not represent the upper or lower limits of potential returns.

		At 4% p.a.		At 8% p.a.
Age	Year	Annualised premium / Maturity benefit	Death benefit	Annualised premium / Maturity benefit	Death benefit
35	1	-1,00,000	6,45,278	-1,00,000	6,45,278
36	2	-1,00,000	6,45,278	-1,00,000	6,45,278
37	3	-1,00,000	6,45,278	-1,00,000	6,45,278
38	4	-1,00,000	6,45,278	-1,00,000	6,45,278
39	5	-1,00,000	6,45,278	-1,00,000	6,45,278
40	6	-1,00,000	6,45,278	-1,00,000	6,45,278
41	7	-1,00,000	6,45,278	-1,00,000	6,45,278
42	8	-1,00,000	6,45,278	-1,00,000	6,45,278
43	9	-1,00,000	6,45,278	-1,00,000	6,45,278
44	10	-1,00,000	6,45,278	-1,00,000	6,45,278
45	11	0	6,45,278	0	6,45,278
46	12	54,849	6,45,278	54,849	6,45,278
47	13	54,849	6,45,278	54,849	6,45,278
48	14	54,849	6,45,278	54,849	6,45,278
49	15	54,849	6,45,278	54,849	6,45,278
50	16	54,849	6,45,278	54,849	6,45,278
51	17	54,849	6,45,278	54,849	6,45,278
52	18	54,849	6,45,278	54,849	6,45,278
53	19	54,849	6,45,278	54,849	6,45,278
54	20	54,849	6,45,278	54,849	6,45,278
55	21	54,849	6,45,278	54,849	6,45,278
56	22	54,849	6,45,278	54,849	6,45,278
57	23	54,849	6,45,278	54,849	6,45,278
58	24	54,849	6,45,278	54,849	6,45,278
59	25	54,849	6,45,278	54,849	6,45,278
60	26	54,849	6,45,278	54,849	6,45,278
61	27	54,849	6,45,278	54,849	6,45,278
62	28	54,849	6,45,278	54,849	6,45,278
63	29	54,849	6,45,278	54,849	6,45,278
64	30	54,849	6,45,278	54,849	6,45,278
		4,25,884		25,90,794

	IRR	2.15%		6.08%

In the 4% scenario, the maturity benefit is ₹3,71,035 with an IRR of 2.15%. In the 8% scenario, the maturity benefit is ₹25,35,945 with an IRR of 6.08% as per the ABSLI Vision Life Income Plus Plan maturity calculator.

These returns are not favourable for a long-term investor, as they are lower than the inflation rate.

While the income benefit is guaranteed, the maturity benefit is not. Additionally, the appropriate utilization of the income benefit is uncertain, making this ABSLI Vision Life Income Plus Plan an unfavourable investment for a long-term investor.

ABSLI Vision Life Income Plus Plan Vs. Other Investments

This segment explains an effective alternative investment strategy that offers better liquidity and returns while accumulating a corpus.

The premium of ₹1 lakh over the first 10 years can be used for both life coverage and corpus accumulation by splitting these components into two different products. Let’s explore this with the following scenario:

ABSLI Vision Life Income Plus Plan Vs. Pure Term + ELSS

A pure-term life insurance policy with a sum assured of ₹6.5 lakhs is available at an affordable premium of ₹8,700. The ABSLI Vision Life Income Plus Plan policy term is 30 years, with a premium paying term of 10 years.

After paying the life insurance premium, the remaining ₹91,300 from the annual ₹1 lakh can be invested to accumulate a corpus for income benefit.

Pure Term Life Insurance Policy
Sum Assured	₹ 6,45,278
Policy Term	30 years
Premium Paying Term	10 years
Annualised Premium	₹ 8,700
Investment	₹ 91,300

For corpus accumulation, we choose the ELSS fund in this scenario. You can select products based on your risk profile. At the end of 10 years, the accumulated corpus in the ELSS fund is ₹17.94 lakhs. After accounting for capital gains tax, the post-tax value is ₹17.16 lakhs.

		Term insurance + ELSS
Age	Year	Term Insurance premium + ELSS	Death benefit
35	1	-1,00,000	6,45,278
36	2	-1,00,000	6,45,278
37	3	-1,00,000	6,45,278
38	4	-1,00,000	6,45,278
39	5	-1,00,000	6,45,278
40	6	-1,00,000	6,45,278
41	7	-1,00,000	6,45,278
42	8	-1,00,000	6,45,278
43	9	-1,00,000	6,45,278
44	10	-1,00,000	6,45,278
45	11	0	6,45,278
46	12	54,849	6,45,278
47	13	54,849	6,45,278
48	14	54,849	6,45,278
49	15	54,849	6,45,278
50	16	54,849	6,45,278
51	17	54,849	6,45,278
52	18	54,849	6,45,278
53	19	54,849	6,45,278
54	20	54,849	6,45,278
55	21	54,849	6,45,278
56	22	54,849	6,45,278
57	23	54,849	6,45,278
58	24	54,849	6,45,278
59	25	54,849	6,45,278
60	26	54,849	6,45,278
61	27	54,849	6,45,278
62	28	54,849	6,45,278
63	29	54,849	6,45,278
64	30	54,849	6,45,278
		44,47,893

	IRR	7.73%

These ELSS post-tax proceeds are then invested in an instrument offering a 7% return, allowing for an annual withdrawal of ₹54,849. By the end of 30 years, the investment is fully withdrawn, matching the maturity benefit of the ABSLI Vision Life Income Plus Plan.

ELSS Tax Calculation
Maturity value after 10 years	17,94,463
Purchase price	9,13,000
Long-Term Capital Gains	8,81,463
Exemption limit	1,00,000
Taxable LTCG	7,81,463
Tax paid on LTCG	78,146
Maturity value after tax	17,16,317

The IRR for this cash flow is 7.73% (post-tax return). If we delay the withdrawals instead of making annual ones, the IRR would be higher, helping to achieve larger financial goals.

This comparison demonstrates effective ways to accumulate a corpus and make withdrawals based on your needs.

Final Verdict on ABSLI Vision Life Income Plus Plan

The ABSLI Vision Life Income Plan is a traditional insurance plan that allows you to customize the income benefit according to your needs.

However, combining both life cover and income benefits makes the ABSLI Vision Life Income Plus Plan a poor performer. Over a long policy term, the returns are unable to keep pace with economic inflation.

The income benefit rarely helps achieve major life goals, and the return analysis highlights that regular income is not a strong reason to invest, as the returns are average and also it has a high agent commission.

Therefore, choosing the ABSLI Vision Life Income Plus Plan for regular income is not advisable.

The comparison segment demonstrates that an alternative investment strategy is a more effective way to accumulate a substantial corpus. Additionally, life insurance coverage should not be combined with investment.

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ABSLI Vision Life Income Plus Plan: Good Or Bad? An Insightful Review

Table of Contents:

What is the ABSLI Vision Life Income Plus Plan?

What are the features of the ABSLI Vision Income Plus Plan?

Who is eligible for the ABSLI Vision Life Income Plus Plan?