ageas federal smart growth plan
Is the Ageas Federal Smart Growth Plan truly a “smart” way to grow your wealth — or just another ULIP dressed in fancy terms?
Does the Ageas Federal Smart Growth Plan live up to its name — or is the “smart” tag doing more marketing than meaning?
Is the Ageas Federal Smart Growth Plan designed for the modern investor — or is it another ULIP that overpromises and underdelivers?
This review explores the plan’s suitability by examining its key features, benefits, and drawbacks.
What is the Ageas Federal Smart Growth Plan?
What are the features of the Ageas Federal Smart Growth Plan?
Who is eligible for the Ageas Federal Smart Growth Plan?
What are the benefits of the Ageas Federal Smart Growth Plan?
3. Guaranteed Loyalty Additions
What are the investment strategies and fund options of the Ageas Federal Smart Growth Plan?
What are the charges of the Ageas Federal Smart Growth Plan?
Grace Period, Discontinuance and Revival of the Ageas Federal Smart Growth Plan
Free Look Period for the Ageas Federal Smart Growth Plan
Surrendering the Ageas Federal Smart Growth Plan
What are the advantages of the Ageas Federal Smart Growth Plan?
What are the disadvantages of the Ageas Federal Smart Growth Plan?
Research Methodology of Ageas Federal Smart Growth Plan
Benefit Illustration – IRR Analysis of Ageas Federal Smart Growth Plan
Ageas Federal Smart Growth Plan Vs. Other Investments
Ageas Federal Smart Growth Plan Vs. Pure-term + PPF/Equity Mutual Fund
Final Verdict on the Ageas Federal Smart Growth Plan
Ageas Federal Smart Growth Plan is a Unit Linked, Non-Participating, Individual Life Insurance Plan. It is designed with a range of choices to give you complete flexibility, along with a life cover benefit that ensures financial security for your loved ones.
| Criteria | Minimum | Maximum |
| Age at entry | 1 month | Option 1 – Prime – 55 years Option 2 – Plus – 45 years |
| Age at maturity | 18 years | Option 1 – Prime – 70 years Option 2 – Plus – 60 years |
| Policy Term | 10/15/20/25 years | |
| Premium Paying Term (PPT) | Policy Term 10 & 15 – 5 years & 6 years For all Policy Terms – 10/15/20 years | |
| Premium amount | PPT 5 years & 6 years (Annual mode) – ₹ 50,000 annually | No Limit |
| PPT 10 /15 /20 years (Annual Mode) – ₹ 35,000 annually | ||
| PPT 5/6/10/15/20 years (Other modes) – ₹ 2,25,000 p.a. | ||
| Premium Payment Frequency | Annual/ Semi-Annual/ Monthly | |
Upon survival of Life Insured till the date of Maturity, the Fund value, including Guaranteed Loyalty Additions as on the date of maturity, is paid, provided the Ageas Federal Smart Growth Plan policy is in force.
In case of the death of the life insured during the Ageas Federal Smart Growth Plan policy term, provided the policy is in force, the Death Benefit as per the option chosen at inception will be paid to the beneficiary, and the policy will terminate.
Option 1 – Prime:
The Death Benefit paid is the highest among the following:
Option 2- Plus:
The Death Benefit paid is the highest among the following:
Sum Assured on Death (Death Sum Assured) for the plan is the higher of:
Guaranteed Loyalty Additions will be 0.5% of the average fund value over the last 36 months preceding the Loyalty Addition allocation date.
These Guaranteed loyalty additions are credited to your Ageas Federal Smart Growth Plan policy at the end of the 10th policy year and at the end of every 5 years thereafter, including the last policy year.
You may decide to invest in any of the funds (except the discontinued policy fund) and change them from time to time, as per your wish.
This option is suitable only if you know precisely where you wish to invest and you have the time & inclination to manage your investments from time to time.
The plan offers nine unit-linked funds. You may choose one or more unit-linked funds based on your risk profile. Unit-linked funds invest in equity and/or debt as per their investment objectives.
| Asset Class | |||||
| S.no | Fund Name | Equities and Equity-linked instruments | Fixed Income Investments | Money Market Investments | Risk Profile |
| 1 | Equity Growth Fund | 50-100% | 0 | 0-50% | High |
| 2 | Midcap Fund | Large cap – 0-50% Mid cap – 50-100% | 0 | 0-50% | High |
| 3 | Multicap Fund | 50-100% | 0 | 0-50% | Moderate to High |
| 4 | Momentum Growth Fund | 90-100% | 0 | 0-10% | High |
| 5 | India Sector Leaders Fund | 90-100% | 0 | 0-10% | High |
| 6 | Pure Fund | 80-100% | 0 | 0-20% | High |
| 7 | Bond Fund II | 0 | 50-100% | 0-50% | Moderate |
| 8 | Aggressive Asset Allocator Fund | 50-100% | 0-50% | 0-50% | High |
| 9 | Moderate Asset Allocator Fund | 0-50% | 50-100% | 0-50% | High (Moderately high – compared to Aggressive Asset Allocator) |
You have the option to choose the Systematic Allocator at the inception of the plan or switch to this option on any policy anniversary.
Under this programmed investment solution, the fund mix becomes more conservative as the investment goal approaches.
The funds are invested in the Equity Growth Fund and Bond Fund II based on the residual time to maturity of the plan. This strategy moves the fund allocation towards Bond Fund II as the plan approaches the maturity date.
By reducing exposure to the Equity Growth Fund, the risk of a sudden drop in the equity market affecting the accumulated value diminishes.
| Balance / Residual time to maturity of the plan (in years) | Proportion allocated to Equity Growth Fund | Proportion allocated to Bond Fund II |
| 1 | 5% | 95% |
| 2 | 10% | 90% |
| 3 | 15% | 85% |
| 4 | 20% | 80% |
| 5 | 25% | 75% |
| 6 | 30% | 70% |
| 7 | 35% | 65% |
| 8 | 45% | 55% |
| 9 | 50% | 50% |
| 10 | 55% | 45% |
| 11 | 60% | 40% |
| 12 | 65% | 35% |
| 13 | 70% | 30% |
| 14 | 75% | 25% |
| 15 & above | 80% | 20% |
Premium allocation charge as a percentage of the annual premium is given below:
| Policy Year | Premium Allocation Charge (p.a.) |
| 1 | 4% |
| 2 to 5 | 3.00% |
| 6+ | 2% |
Policy administration charge as a percentage of the annualised premium is as given below:
| Policy Year | Policy Administration Charge (p.a.) |
| 1 to 5 | 4% |
| 6 to 10 | 3.00% |
| 11+ | 1.25% |
The mortality charge is 1/12th of the mortality charge for the attained age and gender of the life insured, multiplied by the sum at risk divided by 1,000.
Mortality Charge Rates per Rs. 1,000 sum at risk – Age last birthday
| Age | Male | Female |
| 30 | 0.9 | 0.85 |
| 40 | 1.58 | 1.26 |
| 50 | 4.38 | 3.17 |
| Fund Name | Fund Management Charge (p.a.) |
| Equity Growth Fund | 1.35% |
| Midcap Fund | 1.35% |
| Multicap Fund | 1.35% |
| Momentum Growth Fund | 1.35% |
| India Sector Leaders Fund | 1.35% |
| Pure Fund | 1.35% |
| Bond Fund II | 1.25% |
| Aggressive Asset Allocator Fund | 1.35% |
| Moderate Asset Allocator Fund | 1.35% |
| Discontinued policy fund | 0.50% |
There are currently no charges for switching between funds.
There are currently no charges for partial withdrawals
The discontinuance charge will be decided based on the policy year in which the Ageas Federal Smart Growth Plan policy is discontinued and the premium amount. There is no discontinuance charge after the 5th policy year.
Inference from the charges: These charges are deducted from your premium, reducing the amount actually invested. Consequently, the deducted portion loses the opportunity to earn compounding returns over the policy term, leading to a lower overall corpus and diminished final returns.
The grace period for payment of the premium shall be 15 days, where the Ageas Federal Smart Growth Plan policyholder pays the premium on a monthly basis and 30 days in all other cases.
Discontinuing premiums within five years of the policy commencement date: the unit fund value after deducting applicable discontinuance charges shall be credited to the Discontinued Policy Fund, and risk cover and rider cover, if any, shall cease.
The proceeds of the discontinued policy fund shall be paid to the Ageas Federal Smart Growth Plan policyholder at the end of the revival period or lock-in period, whichever is later
Discontinuing premiums after completion of 5 policy years: the policy shall be converted into a reduced paid-up policy with the paid-up sum assured, i.e. original sum assured multiplied by a ratio of “total period for which premiums have already been paid” to the “maximum period for which premiums were originally payable”.
All such discontinued policies shall be provided a revival period of three years from the date of the first unpaid premium.
In case you do not agree to any of the policy terms and conditions, or otherwise and have not made any claim, you have the option to return the policy within a free look period of 30 days beginning from the date of receipt of the policy document (whether received electronically or otherwise).
If you surrender the Ageas Federal Smart Growth Plan policy during the lock-in period, the unit fund value after deducting applicable discontinuance charges shall be credited to the discontinued policy fund, and risk cover and rider cover, if any, shall cease.
The proceeds of the discontinued policy fund shall become payable at the end of the lock-in period.
In case you surrender the policy after the lock-in period, the surrender value shall be at least equal to the unit fund value as on the date of surrender
The potential returns calculation of the Ageas Federal Smart Growth Plan plays a crucial role in evaluating its overall suitability.
At first glance, the plan may appear appealing as it allows individuals to participate in market-linked investments without requiring any technical expertise.
However, assessing the Internal Rate of Return (IRR) provides a clearer picture of the plan’s effectiveness in wealth creation. Let’s examine an example from the policy brochure.
A 35-year-old male invests in the Ageas Federal Smart Growth Plan with a Sum Assured of ₹5 lakhs, a policy term of 20 years, and a premium payment term of 10 years. The annual premium is ₹50,000, and he selects Plan Option 2: Plus.
| Male | 35 years |
| Sum Assured | ₹ 5,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 50,000 |
If he pays premiums regularly, he becomes eligible to receive the fund value, along with guaranteed loyalty additions, at the end of the policy term.
The brochure provides two illustrative scenarios based on assumed annual returns of 4% and 8%—these rates are purely indicative and not guaranteed.
| At 4% p.a. | At 8% p.a. | ||||
| Age | Year | Annualised premium / Maturity benefit | Death benefit | Annualised premium / Maturity benefit | Death benefit |
| 35 | 1 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 36 | 2 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 37 | 3 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 38 | 4 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 39 | 5 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 40 | 6 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 41 | 7 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 42 | 8 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 43 | 9 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 44 | 10 | -50,000 | 5,00,000 | -50,000 | 5,00,000 |
| 45 | 11 | 0 | 5,00,000 | 0 | 5,00,000 |
| 46 | 12 | 0 | 5,00,000 | 0 | 5,00,000 |
| 47 | 13 | 0 | 5,00,000 | 0 | 5,00,000 |
| 48 | 14 | 0 | 5,00,000 | 0 | 5,00,000 |
| 49 | 15 | 0 | 5,00,000 | 0 | 5,00,000 |
| 50 | 16 | 0 | 5,00,000 | 0 | 5,00,000 |
| 51 | 17 | 0 | 5,00,000 | 0 | 5,00,000 |
| 52 | 18 | 0 | 5,00,000 | 0 | 5,00,000 |
| 53 | 19 | 0 | 5,00,000 | 0 | 5,00,000 |
| 54 | 20 | 0 | 0 | ||
| 55 | 6,28,329 | 11,64,955 | |||
| IRR | 1.48% | 5.53% | |||
At 4% p.a., the fund value is projected at ₹6.28 lakhs, resulting in an IRR of 1.48% as per the Ageas Federal Smart Growth Plan maturity calculator.
At 8% p.a., the fund value is projected at ₹11.64 lakhs, with an IRR of 5.53% as per the Ageas Federal Smart Growth Plan maturity calculator.
Both scenarios yield returns that fail to outpace inflation, thereby eroding real purchasing power over time. Moreover, the plan’s high charges and lack of transparency in underlying investments further diminish its attractiveness.
Considering the low returns and limited liquidity, the Ageas Federal Smart Growth Plan appears unsuitable for building a meaningful corpus to achieve medium- to long-term financial goals.
One of the major drawbacks of ULIP (Unit Linked Insurance Plan) products is their lack of transparency regarding investments, commissions, and expenses.
To achieve both effective wealth accumulation and adequate life coverage, it is often wiser to separate insurance and investment components and then compare the overall returns.
Let’s analyse this using the same parameters as in the earlier illustration. Under Plan Option 2: Plus, the Ageas Federal Smart Growth Plan offers both the sum assured and fund value as the death benefit.
Accordingly, we assume a sum assured of ₹15 lakhs for a pure-term life insurance policy to ensure an equivalent comparison.
A pure-term policy providing ₹15 lakhs of life cover for a 20-year term with a 10-year premium payment period costs an annual premium of ₹10,100.
Compared to paying ₹50,000 annually under the ULIP, this approach saves ₹39,900 each year, which can instead be invested according to one’s risk appetite.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 15 Lakhs |
| Policy Term | 20 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 10,100 |
| Investment | ₹ 39,900 |
High-risk investors can invest their savings in equity mutual funds. Risk-averse investors can opt for debt instruments like the Public Provident Fund (PPF).
For this comparison, let’s consider equity mutual funds for the equity route and PPF for the debt route.
| Term Insurance + PPF | Term insurance + Equity Mutual Fund | ||||
| Age | Year | Term Insurance premium + PPF | Death benefit | Term Insurance premium + Equity Mutual Fund | Death benefit |
| 35 | 1 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 36 | 2 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 37 | 3 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 38 | 4 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 39 | 5 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 40 | 6 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 41 | 7 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 42 | 8 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 43 | 9 | -50,000 | 15,00,000 | -50,000 | 15,00,000 |
| 44 | 10 | -47,500 | 15,00,000 | -50,000 | 15,00,000 |
| 45 | 11 | -500 | 15,00,000 | 0 | 15,00,000 |
| 46 | 12 | -500 | 15,00,000 | 0 | 15,00,000 |
| 47 | 13 | -500 | 15,00,000 | 0 | 15,00,000 |
| 48 | 14 | -500 | 15,00,000 | 0 | 15,00,000 |
| 49 | 15 | -500 | 15,00,000 | 0 | 15,00,000 |
| 50 | 16 | 0 | 15,00,000 | 0 | 15,00,000 |
| 51 | 17 | 0 | 15,00,000 | 0 | 15,00,000 |
| 52 | 18 | 0 | 15,00,000 | 0 | 15,00,000 |
| 53 | 19 | 0 | 15,00,000 | 0 | 15,00,000 |
| 54 | 20 | 0 | 0 | ||
| 55 | 11,76,923 | 21,96,704 | |||
| IRR | 5.60% | 9.77% | |||
The PPF account requires a minimum contribution of ₹500 per year and runs for 15 years. Since the ULIP’s premium payment term is 10 years, adjustments are made in the final year’s contribution to align the periods.
The final maturity value in the PPF account works out to ₹11.76 lakhs, yielding an IRR of 5.60%. Although this IRR is close to the 8% scenario of the Ageas Federal Smart Growth Plan, PPF—being a low-risk debt instrument—still outperforms the ULIP on a risk-adjusted basis.
In the case of equity mutual funds, the pre-tax maturity value is ₹24.35 lakhs, while the post-tax value (after capital gains tax) stands at ₹21.96 lakhs.
The combined IRR from the Equity mutual fund investment plus the pure-term policy is an impressive 9.77% (post-tax).
| Equity Mutual Fund Tax Calculation | |
| Maturity value after 20 years | 24,35,662 |
| Purchase price | 3,99,000 |
| Long-Term Capital Gains | 20,36,662 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 19,11,662 |
| Tax paid on LTCG | 2,38,958 |
| Maturity value after tax | 21,96,704 |
This accumulated corpus is almost double that of the Ageas Federal Smart Growth Plan’s 8% return scenario, and the IRR comfortably exceeds the inflation rate.
Overall, this alternative strategy—combining a pure-term life insurance policy with targeted investments—offers better transparency, higher post-tax returns, and superior risk-adjusted performance, aspects that the Ageas Federal Smart Growth Plan fails to deliver.
The Ageas Federal Smart Growth Plan is a typical Unit Linked Insurance Plan (ULIP) that comes with two variants.
Under Plan Option 1: Prime, the death benefit is limited to the fund value, while Plan Option 2: Plus offers both the sum assured and the fund value as the death benefit. In both options, the maturity benefit comprises the fund value along with guaranteed loyalty additions.
However, the plan’s risk–return trade-off is not balanced, especially for a long-term investment. The returns generated are relatively low compared to the level of risk undertaken and it also has a high agent commission.
The Ageas Federal Smart Growth Plan is not ideal for wealth accumulation, and investors may find themselves falling short of their financial goals when they come due.
The combination of modest returns and limited liquidity makes this plan an unattractive investment choice. Despite its name, the plan falls short of being a truly “Smart Growth” solution.
If you aim to be a smart investor, it’s wiser to explore cost-effective, equity-based investment options that deliver superior, inflation-beating returns. For life protection, it is best to separate insurance from investment—a pure-term life insurance policy offers comprehensive coverage at a fraction of the cost.
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For a tailored approach, consider consulting a Certified Financial Planner (CFP). Their expertise can help you design a robust financial plan aligned with your life goals, risk profile, and investment horizon.
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