Ageas Federal Young Star Plus Plan : Good or Bad? An Insightful Review

Is the Ageas Federal Young Star Plus Plan the perfect way to secure your child’s future, or just another traditional savings plan in disguise?

Can the Ageas Federal Young Star Plus Plan truly guarantee your child’s dreams, or are there smarter options you should explore?

Could the Ageas Federal Young Star Plus Plan be the key to stress-free parenting, or a risky commitment with limited returns?

In this article, we explore the importance of effective planning for children’s life goals and take a closer look at the features, benefits, and limitations of the Ageas Federal Young Star Plus Plan.

Table of Contents

What is the Ageas Federal Young Star Plus?

What are the features of the Ageas Federal Young Star Plus?

Who is eligible for the Ageas Federal Young Star Plus?

What are the benefits of the Ageas Federal Young Star Plus?

Maturity benefit

Guaranteed Additions

Survival benefit

Death benefit

Bonuses

Grace Period, Discontinuance and Revival of the Ageas Federal Young Star Plus

Free Look Period for the Ageas Federal Young Star Plus

Surrendering the Ageas Federal Young Star Plus

What are the advantages of the Ageas Federal Young Star Plus?

What are the disadvantages of the Ageas Federal Young Star Plus?

Research Methodology of Ageas Federal Young Star Plus

Benefit Illustration – IRR Analysis of Ageas Federal Young Star Plus

Ageas Federal Young Star Plus Vs. Other Investments

Ageas Federal Young Star Plus Vs. Pure-term + Equity Mutual Fund

Final Verdict on Ageas Federal Young Star Plus

What is the Ageas Federal Young Star Plus?

Ageas Federal Young Star Plus is a Non-Linked, Participating, Individual Life, Savings Insurance Plan. It provides guaranteed payouts in a chosen timeframe to help you fund the crucial milestones of your child’s life.

It also ensures that your loved one’s dreams stay financially safe even in the case of your unfortunate absence.

What are the features of the Ageas Federal Young Star Plus?

• Flexible choice of policy term and premium payment term to match individual needs.
• 125% of the maturity sum assured is paid as guaranteed annual payouts to support key milestones.
• Guaranteed additions of up to 10% every five years, based on the chosen policy term.
• Potential bonuses, when declared, will further enhance savings.
• In case of an unfortunate event, future premiums are waived, and the Ageas Federal Young Star Plus Plan policy continues with scheduled benefits.
• Tax benefits may be available on premiums paid and benefits received, subject to prevailing tax laws.

Who is eligible for the Ageas Federal Young Star Plus?

Parameter	Minimum	Maximum
Age at Entry	18 years	Regular payment option: 40 years Limited payment option: 45 years
Maturity Age	30 years	Regular payment option: 60 years Limited payment option: 65 years
Premium Paying Term / Policy Term	Premium Paying Term (years)	Policy Term (years)
	7	12
	10	12
	12	15
	15	15
	15	20
	20	20
Premium Paying Frequency	Yearly, Half Yearly and Monthly
Premium	Rs 18,000 p.a. (For Yearly frequency) Rs 20,000 p.a. (For Half Yearly frequency) Rs. 24,000 p.a. (For Monthly frequency)	No limit (subject to Board-approved Underwriting Policy)

What are the benefits of the Ageas Federal Young Star Plus?

A). Maturity benefit

Maturity benefit is equal to Vested Guaranteed Additions + Last Guaranteed Annual Payout + Vested Simple Reversionary Bonuses, if any + Interim Bonus, if any + Terminal Bonus, if any.

B). Guaranteed Additions

Guaranteed Additions as described in the table below are accrued to your policy from the 5th policy year and every 5 years thereafter, provided all due annualised premiums are paid or waived to date. Accrued Guaranteed Additions are payable at the time of Maturity.

Policy Term	Accrual of Guaranteed Additions during the policy year	Guaranteed Addition (as a fixed percentage of Maturity Sum Assured)
12	5th & 10th	5.00%
15	5th, 10th & 15th	7.50%
20	5th, 10th, 15th & 20th	10.00%

C). Survival benefit

The plan pays Guaranteed Annual Payouts totalling 125% of the Maturity Sum Assured, in the last 3 or last 5 years of your policy, depending on the Ageas Federal Young Star Plus Plan policy term that you choose at inception, provided all due premiums have been paid or waived to date.

Schedule for Guaranteed Annual Payouts for the policy term of 12 years:

Guaranteed annual payout	Due dates	% of Maturity sum assured
1st	2 years before the maturity date	25%
2nd	1 year before the maturity date	25%
Last Payout	Paid on maturity date	75%

Schedule for Guaranteed Annual Payouts for the policy term of 10 and 15 years:

Guaranteed annual payout	Due dates	% of Maturity sum assured
1st	4 years before the maturity date	25%
2nd	3 years before the maturity date	25%
3rd	2 years before the maturity date	25%
4th	1 year before the maturity date	25%
Last Payout	Paid on maturity date	25%

You can choose your maturity sum assured based on the amount of Guaranteed Annual Payouts you wish to receive. Maturity Sum assured is the sum assured that is used to determine your premium and maturity benefit.

D). Death benefit

In the unfortunate event of your death during the term of the Ageas Federal Young Star Plus Plan policy, provided the policy is in force, the Death Benefit, as explained below, will be applicable. Additionally, no future premiums are payable.

Death Benefit shall be:

• Death Sum Assured, paid immediately on Death, plus
• Future Guaranteed Annual Payouts, to be paid on their respective due dates, plus
• Vested Simple Reversionary and Terminal Bonus, if any, plus
• Vested Guaranteed Additions for the full term to be paid at the end of the Ageas Federal Young Star Plus Plan policy term.

Where,

Death Sum Assured is the highest of:

• Minimum Guaranteed Sum Assured on Maturity
• 10 times the Annualised Premium,
• Any absolute amount assured to be paid on death, which is the Sum Assured
• 105% of the Total Premiums Paid as on the date of death.

E). Bonuses

Simple Reversionary Bonus, if any, shall be expressed as a percentage of Maturity Sum Assured and vested into the Ageas Federal Young Star Plus Plan policy every year from the 1st policy anniversary till the end of Policy Term.

Interim Bonus, if any, is declared as a percentage of Maturity Sum Assured and is payable on Maturity between two Bonus declaration dates.

Terminal Bonus, if any, shall be expressed as a percentage of Maturity Sum Assured and is payable on maturity of the Ageas Federal Young Star Plus Plan policy.

Grace Period, Discontinuance and Revival of the Ageas Federal Young Star Plus

Grace Period

You get a grace period of 30 days for Yearly and Half-Yearly mode and 15 days for Monthly mode, due from the date of the first unpaid premium.

Discontinuance

Lapse: During the first full policy year, if the premium due is not paid within the Grace Period, the policy will lapse. No benefits will be payable where the Ageas Federal Young Star Plus Plan policy has lapsed.

Reduced paid-up: After payment of the first full policy year’s premium, if the premium due is not paid before the end of the Grace Period, your policy shall acquire a paid-up value with reduced benefits.

Revival

A policy which has lapsed or has been made paid-up may be revived for full benefits within 5 consecutive years from the date of the first unpaid premium.

Free Look Period for the Ageas Federal Young Star Plus

In case you do not agree with any of the Ageas Federal Young Star Plus Plan policy terms and conditions, or otherwise and have not made any claim, you have the option to return the policy within 30 days beginning from the date of receipt of the policy document (whether received electronically or otherwise).

Surrendering the Ageas Federal Young Star Plus

The policy shall acquire a Surrender value after completion of the first policy year, provided one full year’s premium has been received. Surrender Value = Maximum [(Guaranteed Surrender Value (GSV), Special Surrender Value (SSV)].

What are the advantages of the Ageas Federal Young Star Plus?

• Option to avail a loan of up to 85% of the Guaranteed Surrender Value.
• Bonuses, when declared, enhance the overall maturity benefit.
• An inbuilt premium waiver feature ensures the Ageas Federal Young Star Plus Plan policy continues without payment in case of unforeseen events.

What are the disadvantages of the Ageas Federal Young Star Plus?

• The sum assured is insufficient to meet long-term financial needs.
• The returns are relatively low compared to other investment options.
• The annual payouts may not align with actual financial requirements.

Research Methodology of Ageas Federal Young Star Plus

Let us now review the cash flow pattern and evaluate the potential returns using the figures provided in the Ageas Federal Young Star Plus Plan policy brochure. The illustration below highlights how the plan functions, enabling you to make an informed choice.

Benefit Illustration – IRR Analysis of Ageas Federal Young Star Plus

A 30-year-old male has taken the Ageas Federal Young Star Plus Plan. He opted for a policy term of 20 years with a premium paying term of 15 years, with an annual premium of ₹54,649. The sum assured is ₹ 5 Lakhs, and the death benefit is ₹ 5.46 Lakhs

Male	30 years
Sum Assured	₹ 5,00,000
Policy Term	20 years
Premium Paying Term	15 years
Annualised Premium	₹ 54,649

The plan offers 5 instalments, beginning at the end of the 16th year. Each instalment equals 25% of the Maturity Sum Assured.

The final instalment also includes guaranteed additions and bonuses. The illustration assumes investment returns of 8% p.a. and 4% p.a. (for demonstration purposes only; actual returns are not guaranteed).

		At 4% p.a.		At 8% p.a.
Age	Year	Annualised premium / Maturity benefit	Death benefit	Annualised premium / Maturity benefit	Death benefit
30	1	-54,649	5,46,490	-54,649	5,46,490
31	2	-54,649	5,46,490	-54,649	5,46,490
32	3	-54,649	5,46,490	-54,649	5,46,490
33	4	-54,649	5,46,490	-54,649	5,46,490
34	5	-54,649	5,46,490	-54,649	5,46,490
35	6	-54,649	5,46,490	-54,649	5,46,490
36	7	-54,649	5,46,490	-54,649	5,46,490
37	8	-54,649	5,46,490	-54,649	5,46,490
38	9	-54,649	5,46,490	-54,649	5,46,490
39	10	-54,649	5,46,490	-54,649	5,46,490
40	11	-54,649	5,46,490	-54,649	5,46,490
41	12	-54,649	5,46,490	-54,649	5,46,490
42	13	-54,649	5,46,490	-54,649	5,46,490
43	14	-54,649	5,46,490	-54,649	5,46,490
44	15	-54,649	5,46,490	-54,649	5,46,490
45	16	0	5,46,490	0	5,46,490
46	17	1,25,000	5,46,490	1,25,000	5,46,490
47	18	1,25,000	5,46,490	1,25,000	5,46,490
48	19	1,25,000	5,46,490	1,25,000	5,46,490
49	20	1,25,000	5,46,490	1,25,000	5,46,490
50		5,47,950	5,46,490	11,06,850	5,46,490
	IRR	2.07%		5.46%

At 4% scenario, the Internal Rate of Return (IRR) works out to 2.07% as per the Ageas Federal Young Star Plus Plan maturity calculator.

At 8% scenario, the IRR stands at 5.46% as per the Ageas Federal Young Star Plus Plan maturity calculator.

The relatively low returns stem from the periodic payouts, which interrupt the power of compounding. For investors aiming to build a sufficient corpus for their child’s education, these returns may fall short of the actual requirement.

Hence, the Ageas Federal Young Star Plus Plan may not be the most effective option to fully cover future expenses.

Ageas Federal Young Star Plus Vs. Other Investments

To generate better returns, it is advisable to separate investment and insurance. In the earlier illustration, while the sum assured was ₹5 lakhs, the death benefit payable was ₹5.46 lakhs. For a fair comparison, let’s consider a pure term life insurance policy with a sum assured of ₹5.5 lakhs.

Ageas Federal Young Star Plus Vs. Pure-term + Equity Mutual Fund

A pure term life insurance policy with a sum assured of ₹5.5 lakhs costs an annual premium of ₹4,800, with a premium paying term of 10 years and a policy term of 20 years.

This leaves you with ₹49,849 annually to invest towards your child’s future. Additionally, since the Ageas Federal Young Star Plus Plan had a 15-year premium-paying term, you can invest the entire amount for the remaining 5 years.

Pure Term Life Insurance Policy
Sum Assured	₹ 5,50,000
Policy Term	20 years
Premium Paying Term	10 years
Annualised Premium	₹ 4,800
Investment	₹ 49,849

		Term insurance + Equity Mutual Fund
Age	Year	Term Insurance premium + Equity Mutual Fund	Death benefit
30	1	-54,649	5,50,000
31	2	-54,649	5,50,000
32	3	-54,649	5,50,000
33	4	-54,649	5,50,000
34	5	-54,649	5,50,000
35	6	-54,649	5,50,000
36	7	-54,649	5,50,000
37	8	-54,649	5,50,000
38	9	-54,649	5,50,000
39	10	-54,649	5,50,000
40	11	-54,649	5,50,000
41	12	-54,649	5,50,000
42	13	-54,649	5,50,000
43	14	-54,649	5,50,000
44	15	-54,649	5,50,000
45	16	0	5,50,000
46	17	1,25,000	5,50,000
47	18	1,25,000	5,50,000
48	19	1,25,000	5,50,000
49	20	1,25,000	5,50,000
50		21,59,598	5,50,000
	IRR	9.26%

We allocate the investible surplus into an equity mutual fund for corpus accumulation. The final Fund Value (15 years) is ₹21.15 lakhs, and the post-tax Maturity Value is ₹19.63 lakhs

At maturity, this corpus is deployed into an instrument generating a 7% return, from which annual withdrawals are made to mirror the cash instalments of the Ageas Federal Young Star Plus Plan. IRR of the combined pure term + equity mutual fund strategy: 9.26%.

Equity Mutual Fund Tax Calculation
Maturity value after 15 years	21,15,512
Purchase price	7,71,735
Long-Term Capital Gains	13,43,777
Exemption limit	1,25,000
Taxable LTCG	12,18,777
Tax paid on LTCG	1,52,347
Maturity value after tax	19,63,165

The standout benefit of this strategy is liquidity. While we assumed instalments similar to the Ageas Federal Young Star Plus Plan policy for comparison, you are not locked into fixed payouts. You retain the flexibility to withdraw as per your actual requirement—a feature that is missing in the Ageas Federal Young Star Plus Plan.

Final Verdict on Ageas Federal Young Star Plus

The Ageas Federal Young Star Plus Plan is a traditional money-back policy that provides life coverage along with periodic cash payouts, irrespective of the Ageas Federal Young Star Plus Plan policyholder’s survival.

Its key highlight is the premium waiver and policy continuance benefit in case of the policyholder’s death.

However, when it comes to funding your child’s education, the plan falls short. With education costs rising at an inflation rate of 10%–12%, the relatively low returns and restricted liquidity of this policy make it an inefficient choice and it also has a high agent commission.

Such limitations can disrupt your cash flow and leave you unprepared for actual expenses.

For crucial life goals like your child’s education, it is essential to invest smartly. Starting early allows you to build the required corpus and keep pace with inflation. Don’t let inadequate investment products like the Young Star Plus Plan derail your child’s aspirations.

Instead, create a strong safety net with a pure-term life insurance policy that provides adequate coverage for your family in case of uncertainties.

Do Quora, Facebook, and Twitter have the final say when it comes to financial advice?

For a comprehensive strategy tailored to your needs, consult a Certified Financial Planner (CFP). Proper planning and timely action ensure you stay on track to meet your financial goals and secure your child’s future.