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Can the ABSLI Wealth Secure Plan ensure your financial security and prosperity?
Can the ABSLI Wealth Secure Plan provide growth and protection for your hard-earned money?
Can the ABSLI Wealth Secure Plan help you achieve your financial milestones?
In this article, we will review the features, advantages, disadvantages, costs, and returns of the ABSLI Wealth Secure Plan using IRR analysis. This detailed review will also compare the plan’s returns with those of similar investment options.
Table of Contents:
What is the ABSLI Wealth Secure Plan?
What are the features of the ABSLI Wealth Secure Plan?
Who is eligible for the ABSLI Wealth Secure Plan?
What are the benefits of the ABSLI Wealth Secure Plan?
What are the investment strategies and Fund options in the ABSLI Wealth Secure Plan?
What are the charges under ABSLI Wealth Secure Plus?
Grace period, Discontinuance and Revival of ABSLI Wealth Secure Plan
Free Look Period of ABSLI Wealth Secure Plan
Surrendering ABSLI Wealth Secure Plan
What are the advantages of the ABSLI Wealth Secure Plan?
What are the disadvantages of the ABSLI Wealth Secure Plan?
Research Methodology of ABSLI Wealth Secure Plan
Benefit Illustration – IRR Analysis of ABSLI Wealth Secure Plan
ABSLI Wealth Secure Plan Vs Other Investments
ABSLI Wealth Secure Plan Vs Pure term + ELSS
Final Verdict on ABSLI Wealth Secure Plan
What is the ABSLI Wealth Secure Plan?
Aditya Birla Sun Life Insurance Wealth Secure Plan is a non-participating unit-linked life insurance plan. Aditya Birla Sun Life Insurance Wealth Secure Plan combines long-term savings and whole-life coverage specially designed to focus on maximising the savings for your future.
What are the features of the ABSLI Wealth Secure Plan?
- Pay premiums for a limited term and get life cover for the whole life
- Flexibility to choose from 3 investment options to suit your investment needs
- Flexibility to add top-ups whenever you have additional savings
- Partial withdrawals are allowed to meet any emergency fund requirements
- Tax benefits under section 80C and section 10(10D) of the Income Tax Act, 1961
Who is eligible for the ABSLI Wealth Secure Plan?
| Entry Age | 30 days to 65 years |
| Premium Paying Term (PPT) | For entry ages 30 days to 44 years: 5 to 30 years For entry ages 45 to 60 years: 8 to 30 years For entry ages 61 to 65 years: 10 to 14 years |
| Maximum PPT | The attained age at the end of the premium paying term must be 75 years or less |
| Basic Premium | Minimum ₹ 30,000 p.a. if paid annually or semi-annually Minimum ₹ 60,000 p.a. if paid monthly or quarterly |
| Top-up Premium | Minimum ₹ 5,000 |
What are the benefits of the ABSLI Wealth Secure Plan?
Guaranteed Additions
Guaranteed Additions in the form of additional units will be added to your Aditya Birla Sun Life Insurance Wealth Secure Plan policy:
On the 10th Aditya Birla Sun Life Insurance Wealth Secure Plan policy anniversary and every 5th policy anniversary thereafter – the Guaranteed Addition is 2.00% of the total basic and top-up premiums paid in the last 60 months
In addition, on the 11th policy anniversary and every Aditya Birla Sun Life Insurance Wealth Secure Plan policy anniversary thereafter – Guaranteed Addition is 0.20% of the average Policy Fund Value in the last 12 months
Death benefit
In the unfortunate event, that the life insured dies while the Aditya Birla Sun Life Insurance Wealth Secure Plan policy is in effect, the nominee will receive the greater of
- Basic Fund Value as on date of intimation of death; or
- Basic Sum Assured
In addition, he receives the greater of
- Top-up Fund Value as on date of intimation of death; or
- Top-up Sum Assured
What are the investment strategies and Fund options in the ABSLI Wealth Secure Plan?
Under ABSLI Wealth Secure Plan, you decide how to invest your premiums in one of the three investment options – Lifecycle Option, Systematic Transfer Option or the Self-Managed Option.
A.) Life-cycle Investment Option
Your portfolio will be structured as per your age and risk profile – you need to decide on your risk profile – Conservative, Moderate or Aggressive. The funds will be shifted from riskier assets to safer assets progressively with your age.
Your Annualized Premium (net of premium allocation charge) is allocated between the two funds, Maximiser (Equity Fund) and Income Advantage (Debt Fund) in a predetermined proportion based on the selected risk profile and your age when the premium is invested.
The percentage allocation to Maximiser according to age and risk profile is as given below:
| Risk Profile | Age group | |||||
| 1 to 30 | 31 to 40 | 41 to 50 | 51 to 60 | 61 to 70 | 71 + | |
| Conservative | 50% | 40% | 30% | 15% | 0% | 0% |
| Moderate | 70% | 60% | 50% | 35% | 20% | 5% |
| Aggressive | 90% | 80% | 70% | 55% | 40% | 25% |
B.) Systematic Transfer Option
Your premium shall be first allocated to the Liquid Plus fund option and thereafter monthly 1/12th or weekly 1/48th of the allocated amount shall be transferred to a segregated fund(s) of your choice.
You can choose up to a maximum of four segregated funds out of;
Enhancer
Creator
Multiplier
Super 20
Income Advantage
Maximiser
MNC
Pure Equity
Value & Momentum
This option is available only for the premium payable in annual mode.
C.) Self-Managed Option
The Aditya Birla Sun Life Insurance Wealth Secure Plan policyholder has the full freedom to control & switch from one segregated fund to another among 16 segregated funds.
The only requirement is that the percentage allocated to any fund be in increments of 1%, ranging from 5% to 100%. The total allocation across all funds must be 100%.
| S.no | Fund Name | Risk Profile | Asset Allocation | ||
| Debt | Money market | Equities | |||
| 1 | Liquid plus | Very low | 20-100% | 0-80% | – |
| 2 | Income Advantage | Very low | 60-100% | 0-40% | – |
| 3 | Assure | Very low | 20-100% | 0-80% | – |
| 4 | Protector | Low | 90-100% | 0-40% | 0-10% |
| 5 | Builder | Low | 80-100% | 0-40% | 10-20% |
| 6 | Enhancer | Medium | 25-80% | 0-40% | 20-35% |
| 7 | Creator | Medium | 50-70% | 0-40% | 30-50% |
| 8 | Asset Allocator | High | 10-80% | 0-40% | 10-80% |
| 9 | Magnifier | High | 10-50% | 0-40% | 50-90% |
| 10 | Maximiser | High | 0-20% | 0-20% | 80-100% |
| 11 | Multiplier | High | 0-20% | 0-20% | 80-100% |
| 12 | Super 20 | High | 0-20% | 0-20% | 80-100% |
| 13 | Pure equity | High | 0-20% | 0-20% | 80-100% |
| 14 | Value & Momentum | High | 0-20% | 0-20% | 80-100% |
| 15 | Capped Nifty index | High | 0-10% | 0-10% | 90-100% |
| 16 | MNC | High | 0-20% | 0-20% | 80-100% |
| Govt Sec | Money market | Equities | |||
| Linked discontinued policy fund | Very low | 60-100% | 0-40% | – | |
What are the charges under ABSLI Wealth Secure Plus?
i.) Premium Allocation charge
A premium allocation charge is levied on the Basic and Top-Up Premium when received:
6.00% of the basic premium payable in the Aditya Birla Sun Life Insurance Wealth Secure Plan policy years 1-2
5.50% of the basic premium payable in the Aditya Birla Sun Life Insurance Wealth Secure Plan policy years 3-6
5.00% of the basic premium payable from the Aditya Birla Sun Life Insurance Wealth Secure Plan’s 7th policy year onwards
A premium allocation charge of 2% is levied on any top-up premium when paid.
ii.) Fund Management charge
1.00% p.a. for Liquid Plus, Income Advantage, Assure, Protector and Builder
1.25% p.a. for Enhancer, Creator, Capped Nifty Index, Asset Allocation
1.35% p.a. for Magnifier, MNC, Maximiser, Multiplier, Super 20, Pure Equity and Value & Momentum
iii.) Policy Administration charge
The policy administration charge is ₹ 20 per month for the first five Aditya Birla Sun Life Insurance Wealth Secure Plan policy years. It shall increase to ₹ 25 per month in the sixth year and inflate at 5% p.a. thereafter, subject to a maximum of ₹ 6,000 p.a.
iv.) Mortality charge
It is based on the Sum at Risk and is deducted at the start of each month by the cancellation of units proportionately from each Fund under the Aditya Birla Sun Life Insurance Wealth Secure Plan policy at the time.
The charge per 1000 of Sum at Risk will depend on the gender and attained age of the Life Insured.
| Attained Age | Age 25 | Age 35 | Age 45 | Age 55 | Age 65 |
| Male | 1.546 | 1.753 | 3.04 | 7.064 | 16.267 |
| Female | 1.502 | 1.605 | 2.505 | 5.494 | 13.197 |
v.) Miscellaneous charge
₹ 50 per request for change in investment option, premium re-direction, fund switch partial withdrawal or any additional servicing request.
vi.) Discontinuance / Surrender charges
It depends on the year of discontinuance/surrender, the annualised premium amount and the fund value.
Inference from charges: Other market-linked products do not impose these charges, particularly the premium allocation charges, policy administration charges, premium redirection charges, fund switch charges, partial withdrawal charges, and discontinuance/surrender charges, which are substantial.
These charges are additional costs for an investor and, over time, will reduce the overall returns.
Grace period, Discontinuance and Revival of ABSLI Wealth Secure Plan
Grace Period
You will be given a Grace Period of 30 days (15 days for monthly mode of premium payment) to pay the due instalment premium.
Discontinuance
Discontinuance during the first five policy years: the Fund Value after deducting the applicable discontinuance /surrender charges shall be credited to the Linked Discontinued Policy Fund and the risk cover, if any, shall cease immediately.
In case You do not exercise the revival option, your Aditya Birla Sun Life Insurance Wealth Secure Plan policy shall continue without any risk cover and rider cover, if any, and the Fund Value shall remain invested in the Linked Discontinued Policy Fund.
At the end of the lock-in period, the proceeds in the Linked Discontinued Fund shall be paid to you and your Aditya Birla Sun Life Insurance Wealth Secure Plan policy will terminate.
Discontinuance after the first five policy years: your Aditya Birla Sun Life Insurance Wealth Secure Plan policy shall be converted into a reduced paid-up policy with the Reduced paid-up Sum Assured
i.e. original Sum Assured multiplied by the total number of Annualized Premiums paid to the original number of Annualized Premiums payable as per the terms and conditions of the Aditya Birla Sun Life Insurance Wealth Secure Plan policy.
Revival
The Aditya Birla Sun Life Insurance Wealth Secure Plan policy can be revived within the revival period of three years.
Free Look Period of ABSLI Wealth Secure Plan
You will have the right to return your Aditya Birla Sun Life Insurance Wealth Secure Plan Policy within 30 days from the date of receipt of the Policy, in case You disagree with the terms & conditions of Your Aditya Birla Sun Life Insurance Wealth Secure Plan Policy.
Surrendering ABSLI Wealth Secure Plan
Surrendering during the first five policy years: the Fund Value after deducting the applicable discontinuance /surrender charges shall be credited to the Linked Discontinued Policy Fund and the risk cover, if any, shall cease immediately.
The proceeds in the Linked Discontinued Policy Fund shall be paid to you at the end of the revival period or lock-in period whichever is later.
Surrendering after the first five policy years: You will have an option to surrender the Aditya Birla Sun Life Insurance Wealth Secure Plan policy anytime and the Fund Value shall be payable upon receipt of such request of surrender.
What are the advantages of the ABSLI Wealth Secure Plan?
- For added protection, the Aditya Birla Sun Life Insurance Wealth Secure Plan can be enhanced by adding riders for a nominal extra cost
- You are allowed to make unlimited partial withdrawals any time after five complete Aditya Birla Sun Life Insurance Wealth Secure Plan policy years or life insured attaining the age of 18; whichever is later.
- 3 investment strategies and 16 fund options are available.
What are the disadvantages of the ABSLI Wealth Secure Plan?
- Policy loans are not allowed in this Aditya Birla Sun Life Insurance Wealth Secure Plan .
- No maturity benefit under the Aditya Birla Sun Life Insurance Wealth Secure Plan . The death benefit is payable to the nominee.
- The fund options are repetitive, as the asset allocation is similar across each option.
Research Methodology of ABSLI Wealth Secure Plan
The purpose of any investment is to help you achieve your life goals. The accumulated corpus from the investment, available at the end of the Aditya Birla Sun Life Insurance Wealth Secure Plan policy term, is known as the maturity benefit.
However, the ABSLI Wealth Secure Plan, being a whole-life policy, does not specify a maturity benefit in its brochure. Instead, it offers a death benefit, which is the higher of the sum assured or the fund value, payable to the nominee.
Benefit Illustration – IRR Analysis of ABSLI Wealth Secure Plan
Based on the limited information in the ABSLI Wealth Secure Plan policy brochure, let’s calculate the Internal Rate of Return (IRR). Suppose a 35-year-old male opts for the ABSLI Wealth Secure Plan with a Sum Assured of ₹10 Lakhs.
The policy term is 65 years (100 – Age 35), and the premium paying term is 10 years, with an annual premium of ₹1 Lakh.
| Male | 35 years |
| Sum Assured | ₹ 10,00,000 |
| Policy Term | 65 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 1,00,000 |
Given that this is a whole-life policy with no specific maturity benefit, we will assume a life expectancy of 80 years. The illustrations provided show two 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 | 10,00,000 | -1,00,000 | 10,00,000 |
| 36 | 2 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 37 | 3 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 38 | 4 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 39 | 5 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 40 | 6 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 41 | 7 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 42 | 8 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 43 | 9 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 44 | 10 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 45 | 11 | 0 | 10,00,000 | 0 | 10,00,000 |
| 46 | 12 | 0 | 10,00,000 | 0 | 10,00,000 |
| 47 | 13 | 0 | 10,00,000 | 0 | 10,00,000 |
| 48 | 14 | 0 | 10,00,000 | 0 | 10,00,000 |
| 49 | 15 | 0 | 10,00,000 | 0 | 10,00,000 |
| 50 | 16 | 0 | 10,00,000 | 0 | 10,00,000 |
| 51 | 17 | 0 | 10,00,000 | 0 | 10,00,000 |
| 52 | 18 | 0 | 10,00,000 | 0 | 10,00,000 |
| 53 | 19 | 0 | 10,00,000 | 0 | 10,00,000 |
| 54 | 20 | 0 | 10,00,000 | 0 | 10,00,000 |
| 55 | 21 | 0 | 10,00,000 | 0 | 10,00,000 |
| 56 | 22 | 0 | 10,00,000 | 0 | 10,00,000 |
| 57 | 23 | 0 | 10,00,000 | 0 | 10,00,000 |
| 58 | 24 | 0 | 10,00,000 | 0 | 10,00,000 |
| 59 | 25 | 0 | 10,00,000 | 0 | 10,00,000 |
| 60 | 26 | 0 | 10,00,000 | 0 | 10,00,000 |
| 61 | 27 | 0 | 10,00,000 | 0 | 10,00,000 |
| 62 | 28 | 0 | 10,00,000 | 0 | 10,00,000 |
| 63 | 29 | 0 | 10,00,000 | 0 | 10,00,000 |
| 64 | 30 | 0 | 10,00,000 | 0 | 10,00,000 |
| 65 | 31 | 0 | 10,00,000 | 0 | 10,00,000 |
| 66 | 32 | 0 | 10,00,000 | 0 | 10,00,000 |
| 67 | 33 | 0 | 10,00,000 | 0 | 10,00,000 |
| 68 | 34 | 0 | 10,00,000 | 0 | 10,00,000 |
| 69 | 35 | 0 | 10,00,000 | 0 | 10,00,000 |
| 70 | 36 | 0 | 10,00,000 | 0 | 10,00,000 |
| 71 | 37 | 0 | 10,00,000 | 0 | 10,00,000 |
| 72 | 38 | 0 | 10,00,000 | 0 | 10,00,000 |
| 73 | 39 | 0 | 10,00,000 | 0 | 10,00,000 |
| 74 | 40 | 0 | 10,00,000 | 0 | 10,00,000 |
| 75 | 41 | 0 | 10,00,000 | 0 | 10,00,000 |
| 76 | 42 | 0 | 10,00,000 | 0 | 10,00,000 |
| 77 | 43 | 0 | 10,00,000 | 0 | 10,00,000 |
| 78 | 44 | 0 | 10,00,000 | 0 | 10,00,000 |
| 79 | 45 | 0 | 10,00,000 | 0 | 10,00,000 |
| 80 | 25,59,000 | 10,00,000 | 1,28,00,000 | 10,00,000 | |
| IRR | 2.34% | 6.45% | |||
In the 4% scenario, the fund value is ₹25.59 Lakhs with an IRR of 2.34%. In the 8% scenario, the fund value is ₹1.28 Crores with an IRR of 6.45% as per the Aditya Birla Sun Life Insurance Wealth Secure Plan maturity calculator.
However, these fund values will not benefit you directly, as they are payable to the nominee. The accumulated corpus in the ABSLI Wealth Secure Plan cannot be utilised during your lifetime unless you surrender the policy.
ABSLI Wealth Secure Plan Vs Other Investments
The goal of a market-linked investment is to accumulate a substantial corpus for achieving specific milestones, particularly long-term goals. However, the ABSLI Wealth Secure Plan does not support milestone achievement, as it locks funds until death.
Additionally, the Aditya Birla Sun Life Insurance Wealth Secure Plan provides whole-life coverage, which is generally not recommended in personal finance. In this context, life covers only until your working years is considered sufficient.
Considering these factors, let’s explore a better alternative that offers both liquidity and adequate life cover.
ABSLI Wealth Secure Plan Vs Pure term + ELSS
For life cover until age 60, a pure term life insurance policy with a sum assured of ₹10 Lakhs costs ₹8,800 annually. The Aditya Birla Sun Life Insurance Wealth Secure Plan policy term is 25 years, and the premium paying term is 10 years.
This leaves a balance of ₹91,200 for investment. An ELSS fund, a market-linked product, is chosen as the investment vehicle.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 10,00,000 |
| Policy Term | 25 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 8,800 |
| Investment | ₹ 91,200 |
| Age | Year | Term Insurance premium + ELSS | Death benefit |
| 35 | 1 | -1,00,000 | 10,00,000 |
| 36 | 2 | -1,00,000 | 10,00,000 |
| 37 | 3 | -1,00,000 | 10,00,000 |
| 38 | 4 | -1,00,000 | 10,00,000 |
| 39 | 5 | -1,00,000 | 10,00,000 |
| 40 | 6 | -1,00,000 | 10,00,000 |
| 41 | 7 | -1,00,000 | 10,00,000 |
| 42 | 8 | -1,00,000 | 10,00,000 |
| 43 | 9 | -1,00,000 | 10,00,000 |
| 44 | 10 | -1,00,000 | 10,00,000 |
| 45 | 11 | 0 | 10,00,000 |
| 46 | 12 | 0 | 10,00,000 |
| 47 | 13 | 0 | 10,00,000 |
| 48 | 14 | 0 | 10,00,000 |
| 49 | 15 | 0 | 10,00,000 |
| 50 | 16 | 0 | 10,00,000 |
| 51 | 17 | 0 | 10,00,000 |
| 52 | 18 | 0 | 10,00,000 |
| 53 | 19 | 0 | 10,00,000 |
| 54 | 20 | 0 | 10,00,000 |
| 55 | 21 | 0 | 10,00,000 |
| 56 | 22 | 0 | 10,00,000 |
| 57 | 23 | 0 | 10,00,000 |
| 58 | 24 | 0 | 10,00,000 |
| 59 | 25 | 0 | 10,00,000 |
| 60 | 26 | 0 | 10,00,000 |
| 61 | 27 | 0 | 10,00,000 |
| 62 | 28 | 0 | 10,00,000 |
| 63 | 29 | 0 | 10,00,000 |
| 64 | 30 | 0 | 10,00,000 |
| 65 | 31 | 0 | 10,00,000 |
| 66 | 32 | 0 | 10,00,000 |
| 67 | 33 | 0 | 10,00,000 |
| 68 | 34 | 0 | 10,00,000 |
| 69 | 35 | 0 | 10,00,000 |
| 70 | 36 | 0 | 10,00,000 |
| 71 | 37 | 0 | 10,00,000 |
| 72 | 38 | 0 | 10,00,000 |
| 73 | 39 | 0 | 10,00,000 |
| 74 | 40 | 0 | 10,00,000 |
| 75 | 41 | 0 | 10,00,000 |
| 76 | 42 | 0 | 10,00,000 |
| 77 | 43 | 0 | 10,00,000 |
| 78 | 44 | 0 | 10,00,000 |
| 79 | 45 | 0 | 10,00,000 |
| 80 | 8,52,80,091 | 10,00,000 | |
| IRR | 11.47% |
Similar to the ABSLI Wealth Secure Plan, let’s examine the fund value at the end of 45 years, which amounts to ₹9.46 crores. After accounting for capital gains tax, the post-tax maturity value is ₹8.52 crores with an IRR of 11.47% (post-tax return).
| ELSS Tax Calculation | |
| Maturity value after 45 years | 9,46,43,212 |
| Purchase price | 9,12,000 |
| Long-Term Capital Gains | 9,37,31,212 |
| Exemption limit | 1,00,000 |
| Taxable LTCG | 9,36,31,212 |
| Tax paid on LTCG | 93,63,121 |
| Maturity value after tax | 8,52,80,091 |
The primary advantage of this investment is its liquidity. You can use the fund for any milestone or partially redeem it to offset any shortfall or meet an emergency. The ABSLI Wealth Secure Plan lacks these benefits, and its potential return is comparatively low.
Final Verdict on ABSLI Wealth Secure Plan
In a unit-linked product, an investor aims to grow their savings at a higher rate than other investments, accepting extra risk for potentially higher returns. Although the ABSLI Wealth Secure Plan is a ULIP, its potential returns are relatively low.
Additionally, the fund value in this Aditya Birla Sun Life Insurance Wealth Secure Plan is notional, meaning it cannot be utilized for any goals during the policyholder’s lifetime. Only the nominee can liquidate the fund value, keeping the investment locked until then.
This is a significant drawback of the ABSLI Wealth Secure Plan. To access the fund value, you might have to resort to partial withdrawals or surrender the Aditya Birla Sun Life Insurance Wealth Secure Plan policy.
The whole-life cover benefit of the ABSLI Wealth Secure Plan doesn’t add much value and instead increases the mortality charge and also it has a high agent commission.
A pure-term life insurance policy covering your working years is usually sufficient .
For wealth creation, it is better to build a diversified investment portfolio, which will help you achieve your financial milestones.
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To select the right insurance and investment products, consult a Certified Financial Planner (CFP). They can create tailored plans based on your risk profile, time horizon, and life goals.
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