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Can ABSLI Vision Moneyback Plus Plan offer periodic payouts while ensuring future security?
Is ABSLI Vision Moneyback Plus Plan the better way to combine regular income with long-term savings?
Is ABSLI Vision Moneyback Plus Plan the right plan to provide this financial security for your family?
In this article, we will explore the features, advantages, disadvantages, and returns of the ABSLI Vision Moneyback Plus Plan, including an analysis of its Internal Rate of Return. This review aims to give you a thorough understanding of the plan.
Table of Contents:
What is the ABSLI Vision Moneyback Plus Plan?
What are the features of the ABSLI Vision Moneyback Plus Plan?
Who is eligible for the ABSLI Vision Moneyback Plus Plan?
What are the benefits of the ABSLI Vision Moneyback Plus Plan?
1. Guaranteed Survival benefit
Grace Period, Reduced paid-up and Revival of ABSLI vision Moneyback Plus Plan
Free-Look Period of ABSLI Vision Moneyback Plus Plan
Surrendering ABSLI Vision Moneyback Plus Plan
What are the advantages of the ABSLI Vision Moneyback Plus Plan?
What are the disadvantages of the ABSLI Vision Moneyback Plus Plan?
Benefit Illustration – IRR Analysis of ABSLI Vision Moneyback Plus Plan
ABSLI Vision Moneyback Plus Plan Vs. Other Investments
ABSLI Vision Moneyback Plus Plan Vs. Pure Term + ELSS
Final Verdict on ABSLI Vision Moneyback Plus Plan
What is the ABSLI Vision Moneyback Plus Plan?
Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan is a non-linked participating life insurance plan.
Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan offers Guaranteed liquidity during the policy term to meet your regular life goals. It offers Comprehensive financial protection for your family.
What are the features of the ABSLI Vision Moneyback Plus Plan?
- Guaranteed regular payouts to meet your regular life goals
- Option to defer and enhance payouts
- Multiple riders for enhanced protection can be added
- Your premium will depend on the amount of the Sum Assured you select, premium paying term, policy term and intervals for regular payouts.
Who is eligible for the ABSLI Vision Moneyback Plus Plan?
| Entry Age | 13 – 45 years |
| Policy term | 20 / 24 /25 years |
| Premium paying term | 10 years for a 20-year policy term 12 years for 24, 25-year policy term |
| Minimum Sum Assured | ₹ 1 Lakh |
| Premium Frequency | Annual, Semi-annual, Quarterly and Monthly |
What are the benefits of the ABSLI Vision Moneyback Plus Plan?
i.) Guaranteed Survival benefit
Every 4th or 5th policy anniversary as selected by you; you shall receive a survival benefit as a percentage of the Sum Assured. These benefits will continue throughout the Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy term as long as the life insured survives.
You can choose to defer the due Guaranteed Survival Benefit until the time the next Guaranteed Survival Benefit is due to be paid. The payout will happen only when the Guaranteed Survival Benefit is due to be paid.
ii.) Death benefit
In the unfortunate event of the death of the life insured during the Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy term, the death benefit payable to the nominee shall be
- Sum Assured on Death; plus
- Accrued regular bonuses as of the date of death; plus
- Terminal bonus (if any)
Sum Assured on Death is the maximum of
- Sum Assured chosen at inception irrespective of any survival benefits paid or
- Sum Assured on Maturity or
- 10 times the Annualized premium payable.
- The death benefit will be subject to a minimum of 105% of Total Premiums paid to date.
iii.) Maturity Benefit
In the event, that the life insured survives to the end of the policy term, accrued bonuses to date plus a terminal bonus (if any) shall be payable.
Grace Period, Reduced paid-up and Revival of ABSLI vision Moneyback Plus Plan
Grace period
If you are unable to pay your premium by the due date, you will be given a grace period of 30 days.
Reduced paid-up
In case you have not paid premiums for two full years, then all benefits under your Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy will cease immediately.
In case you have paid premiums for at least two full years, then your Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy will continue on a Reduced Paid-Up basis.
Revival
The Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy can be revived for its full coverage within five years from the due date of the first unpaid premium
Free-Look Period of ABSLI Vision Moneyback Plus Plan
You will have the right to return your Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy within 15 days (30 days in case the policy was issued under the provisions of IRDAI Guidelines on Distance Marketing of Insurance products) from the date of receipt of the policy
Surrendering ABSLI Vision Moneyback Plus Plan
The Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy will acquire a surrender value after all due premiums for at least two full policy years are paid. The Guaranteed Surrender Value is a percentage of Total premiums paid plus the surrender value of accrued regular bonuses less any survival benefits already paid or deferred.
What are the advantages of the ABSLI Vision Moneyback Plus Plan?
- You may take a loan against your Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan policy with a maximum of 85% of the surrender value.
- The Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan offers tax benefits under Section 80C and Section 10(10D) of the Income Tax Act, 1961.
What are the disadvantages of the ABSLI Vision Moneyback Plus Plan?
- Regular payouts are likely to be spent on discretionary expenses.
- If the survival benefit is deferred, it will only be accessible when the next survival benefit is due.
- The maturity benefit is non-guaranteed, as the bonus rate fluctuates annually.
Research Methodology
The ABSLI Vision Moneyback Plus Plan offers guaranteed regular payouts. While regular income may meet your financial needs, it is essential to evaluate the plan’s overall return.
We will calculate the Internal Rate of Return (IRR) based on the benefit illustration provided in the ABSLI Vision Moneyback Plus Plan policy brochure.
This calculation will aid in making an informed decision.
Benefit Illustration – IRR Analysis of ABSLI Vision Moneyback Plus Plan
Consider a 35-year-old male who chooses the ABSLI Vision Moneyback Plus Plan with a sum assured of ₹2.5 lakhs. The policy term is 20 years, with a premium paying term of 10 years and an annual premium of ₹26,225.
| Male | 35 years |
| Sum Assured | ₹ 2,50,000 |
| Policy Term | 20 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 26,225 |
During the policy term, he will receive survival benefits at the end of the 5th, 10th, 15th, and 20th years. The guaranteed survival benefit is a percentage of the sum assured, and along with the final payout, the maturity benefit is also receivable.
The maturity benefit includes bonuses. The illustration presents two different assumed future investment return rates: 8% p.a. and 4% p.a. These assumed rates are not guaranteed and do not represent the maximum or minimum possible 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 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 36 | 2 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 37 | 3 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 38 | 4 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 39 | 5 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 40 | 6 | 11,279 | 2,50,000 | 11,279 | 2,50,000 |
| 41 | 7 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 42 | 8 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 43 | 9 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 44 | 10 | -26,225 | 2,50,000 | -26,225 | 2,50,000 |
| 45 | 11 | 23,784 | 2,50,000 | 23,784 | 2,50,000 |
| 46 | 12 | 0 | 2,50,000 | 0 | 2,50,000 |
| 47 | 13 | 0 | 2,50,000 | 0 | 2,50,000 |
| 48 | 14 | 0 | 2,50,000 | 0 | 2,50,000 |
| 49 | 15 | 0 | 2,50,000 | 0 | 2,50,000 |
| 50 | 16 | 62,500 | 2,50,000 | 62,500 | 2,50,000 |
| 51 | 17 | 0 | 2,50,000 | 0 | 2,50,000 |
| 52 | 18 | 0 | 2,50,000 | 0 | 2,50,000 |
| 53 | 19 | 0 | 2,50,000 | 0 | 2,50,000 |
| 54 | 20 | 0 | 2,50,000 | 0 | 2,50,000 |
| 55 | 1,50,000 | 3,25,000 | |||
| IRR | 0.38% | 4.33% | |||
At the 4% return scenario, the IRR for the cash flow is 0.38%, indicating virtually no value addition. At the 8% return scenario, the IRR is 4.33% as per the Aditya Birla Sun Life Insurance Vision Moneyback Plus Plan maturity calculator, which is lower than the returns on debt instruments.
The IRR analysis reveals that this plan results in locking in your investment for the long term with minimal returns. The returns of the ABSLI Vision Moneyback Plus Plan are at a rock-bottom level, making it unlikely to help you achieve your financial goals.
ABSLI Vision Moneyback Plus Plan Vs. Other Investments
The investment returns of the ABSLI Vision Moneyback Plus Plan are poor, and the life cover is too low due to the combination of insurance and investment. A standard pure-term life insurance policy, such as Saral Jeevan Bima, offered by all insurers, has a minimum sum assured of ₹5 lakhs.
In the previous illustration, the sum assured was only ₹2.5 lakhs. Therefore, for comparison, we assume a life cover sum assured of ₹5 lakhs.
ABSLI Vision Moneyback Plus Plan Vs. Pure Term + ELSS
A pure term life insurance policy with a sum assured of ₹5 lakhs costs an annual premium of ₹4,400, with a policy term of 20 years and a premium paying term of 10 years. This leaves ₹21,825 per year for 10 years available for investment.
To match the survival benefits of the ABSLI Vision Moneyback Plus Plan, a similar amount is withdrawn from this investment during the policy term. For this comparison, we have chosen an ELSS fund for the investment.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 2,50,000 |
| Policy Term | 20 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 4,400 |
| Investment | ₹ 21,825 |
| Age | Year | Term Insurance premium + ELSS |
| 35 | 1 | -26,225 |
| 36 | 2 | -26,225 |
| 37 | 3 | -26,225 |
| 38 | 4 | -26,225 |
| 39 | 5 | -26,225 |
| 40 | 6 | 11,279 |
| 41 | 7 | -26,225 |
| 42 | 8 | -26,225 |
| 43 | 9 | -26,225 |
| 44 | 10 | -26,225 |
| 45 | 11 | 23,784 |
| 46 | 12 | 0 |
| 47 | 13 | 0 |
| 48 | 14 | 0 |
| 49 | 15 | 0 |
| 50 | 16 | 62,500 |
| 51 | 17 | 0 |
| 52 | 18 | 0 |
| 53 | 19 | 0 |
| 54 | 20 | 0 |
| 55 | 8,07,257 | |
| IRR | 9.53% |
At the end of 20 years, all units are redeemed to match the maturity benefit of the ABSLI Vision Moneyback Plus Plan. Capital gains are calculated only at the final redemption and not for previous withdrawals (survival benefits), considering the exemption of up to ₹1 lakh per year for LTCG.
| ELSS Tax Calculation | |
| Maturity value after 20 years | 8,61,591 |
| Purchase price | 2,18,250 |
| Long-Term Capital Gains | 6,43,341 |
| Exemption limit | 1,00,000 |
| Taxable LTCG | 5,43,341 |
| Tax paid on LTCG | 54,334 |
| Maturity value after tax | 8,07,257 |
The IRR for the pure-term life insurance combined with the ELSS investment yields an IRR of 9.53% (post-tax return). This strategy offers more flexibility than the ABSLI Vision Moneyback Plus Plan, allowing you to withdraw funds as needed based on your personal requirements.
The lack of flexibility and inadequate life cover are significant drawbacks of the ABSLI Vision Moneyback Plus Plan.
Final Verdict on ABSLI Vision Moneyback Plus Plan
The primary goal of the ABSLI Vision Moneyback Plus Plan is to secure your savings by providing regular liquidity to meet your financial needs while offering life cover protection for your family. However, this simple money-back plan offers below-average returns.
The savings accumulated under this plan are unlikely to provide substantial support in times of financial need.
The investment component of the plan does not help achieve your financial goals, as the survival benefits are minimal. Additionally, the insurance coverage is inadequate to meet the basic needs of your family. Consequently, the ABSLI Vision Moneyback Plus Plan fails to offer significant benefits in either the insurance or investment aspects and also has a High agent commission
Before beginning your investment journey, it is crucial to secure an adequate pure-term life insurance policy. This will serve as a safety net, and the premiums are affordable for a high level of coverage.
Based on your financial goals, time horizon, and risk profile, you should then start building a diversified investment portfolio.
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For comprehensive financial planning, consult a Certified Financial Planner. They can help you identify the right investment products tailored to your personal goals and other relevant factors.
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