Aviva Bharat Bal Vikas Yojana Plan: Good or Bad? A Detailed Review
Is the Aviva Bharat Bal Vikas Yojana Plan the right solution to secure your child’s future?
Can the Aviva Bharat Bal Vikas Yojana Plan help you achieve your child’s long-term financial goals?
What are the features, benefits, and drawbacks of the Aviva Bharat Bal Vikas Yojana Plan?
Should you invest in the Aviva Bharat Bal Vikas Yojana Plan for your child’s education planning?
This review explores the plan’s key features, evaluates its suitability, and helps you determine whether it aligns with your child’s long-term financial goals.
1. What is the Aviva Bharat Bal Vikas Yojana?
2. What are the features of the Aviva Bharat Bal Vikas Yojana?
3. Who is eligible for the Aviva Bharat Bal Vikas Yojana?
4. What are the benefits of the Aviva Bharat Bal Vikas Yojana?
5. Grace Period, Discontinuance and Revival of the Aviva Bharat Bal Vikas Yojana
6. Free Look Period of the Aviva Bharat Bal Vikas Yojana
7. Surrendering the Aviva Bharat Bal Vikas Yojana
8. What are the advantages of the Aviva Bharat Bal Vikas Yojana?
9. What are the disadvantages of the Aviva Bharat Bal Vikas Yojana?
10. Research Methodology of Aviva Bharat Bal Vikas Yojana
Benefit Illustration – IRR Analysis of Aviva Bharat Bal Vikas Yojana
11. Aviva Bharat Bal Vikas Yojana Vs. Other Investment
Aviva Bharat Bal Vikas Yojana Vs. Pure-term + PPF / Equity Mutual Fund
12. Final Verdict on Aviva Bharat Bal Vikas Yojana
Aviva Bharat Bal Vikas Yojana is an Individual Non-Linked, Non-Participating Savings Life Insurance Plan.
It offers guaranteed returns and multiple Policy and Premium Payment Terms.
It offers guaranteed maturity to achieve financial goals.
| Entry Age | Minimum: 3 Years (last birthday) for PT ≥ 15 years |
| Minimum: 6 Years (last birthday) for PT = 12 years | |
| Maximum: 50 Years (last birthday) | |
| Maturity Age | Minimum: 18 years |
| Maximum: 80 years depending on policy term | |
| Policy Term (PT) | 12, 15, 20, 25, or 30 years |
| Premium Payment Term (PPT) | 7, 10, 15, 20, or 25 years (fixed to selected policy term) |
| Premium Amounts | Annual: ₹12,000/₹24,000/₹36,000 / ₹48,000 / ₹60,000 |
| Half-yearly: ₹6,000/₹12,000 / ₹18,000 / ₹24,000 / ₹30,000 | |
| Quarterly: ₹3,000/ ₹6,000/₹9,000/₹12,000/₹15,000 | |
| Monthly: ₹1,000/₹2,000 / ₹3,000 / ₹4,000/₹5,000 | |
| Payment Frequency | Yearly / Half-Yearly / Quarterly / Monthly |
In case of the death of the Life Insured during the Policy Term, provided all due Premiums have been paid up to the date of death, the Death Benefit shall be paid to the nominee.
The Death Benefit shall always be the highest of the following:
where X% would be as per Death Benefit Factors Table depending upon the Policy month of death, Frequency of the Premium Payment, Policy Term and Premium Payment Term.
In case the Life Insured survives till the end of the Policy Term – and provided all due Premiums have been paid – the Maturity Sum Assured shall be paid to the Policyholder.
Grace Period
The Grace Period for the payment of Premium shall be 30 days for Yearly, Half-Yearly, Quarterly Premiums and 15 days for Monthly payments.
Discontinuance
If the due Premium of the first Policy year has not been paid before the expiry of the Grace Period, then the Aviva Bharat Bal Vikas Yojana Plan Policy will lapse without acquiring any benefit.
If all due Premiums of the first Policy year have been paid and any subsequent due Premium is not paid before the expiry of the grace period, the Aviva Bharat Bal Vikas Yojana Plan Policy will become a Paid-Up Policy with reduced benefits
Revival
The Policyholder will have 5 years from the date of First Unpaid due Premium (FUP) to revive a lapsed / Paid-Up Policy by paying all due Premiums along with interest.
This is an option to review the Policy following receipt of the Aviva Bharat Bal Vikas Yojana Plan Policy Document.
The Policyholder has the right to review the Policy Terms and Conditions during the Free Look Period, which is 30 days from the date of receipt of the Policy Document.
If the Policyholder disagrees with any of those terms or conditions, he has the option to return the Policy.
The Aviva Bharat Bal Vikas Yojana Plan policy can be surrendered anytime during the Policy Term by the Policyholder provided one full year Premium has been received.
However, Surrender Value is payable after the completion of the first Policy year. The Guaranteed Surrender Value for this purpose shall be determined based on the Policy year in which the request for surrender is received by the Company.
However, the Special Surrender Value for this purpose shall be determined based on the Duration Completed / Elapsed by the Policy at the time of payment.
The Surrender Value payable is the greater of the Guaranteed Surrender Value and the Special Surrender Value.
The Aviva Bharat Bal Vikas Yojana Plan promotes disciplined savings through guaranteed benefits.
However, saving alone is not enough—it is equally important to ensure that your investments generate returns capable of outpacing inflation and helping you achieve your long-term financial goals.
Consider a 35-year-old individual opting for the plan with a sum assured of ₹6 lakhs, a premium payment term of 15 years, a policy term of 20 years, and an annual premium of ₹60,000.
At maturity, the policy pays a guaranteed maturity benefit of ₹18 lakhs, resulting in an Internal Rate of Return (IRR) of approximately 5.28% as per the Aviva Bharat Bal Vikas Yojana Plan maturity calculator.
| Male | 35 years |
| Sum Assured | ₹ 6,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | 15 years |
| Annualised Premium | ₹ 60,000 |
| Age | Year | Annualised premium / Maturity benefit | Death benefit |
| 35 | 1 | -60,000 | 6,00,000 |
| 36 | 2 | -60,000 | 6,00,000 |
| 37 | 3 | -60,000 | 6,00,000 |
| 38 | 4 | -60,000 | 6,00,000 |
| 39 | 5 | -60,000 | 6,00,000 |
| 40 | 6 | -60,000 | 6,00,000 |
| 41 | 7 | -60,000 | 6,00,000 |
| 42 | 8 | -60,000 | 6,00,000 |
| 43 | 9 | -60,000 | 6,00,000 |
| 44 | 10 | -60,000 | 6,00,000 |
| 45 | 11 | -60,000 | 6,00,000 |
| 46 | 12 | -60,000 | 6,00,000 |
| 47 | 13 | -60,000 | 6,00,000 |
| 48 | 14 | -60,000 | 6,00,000 |
| 49 | 15 | -60,000 | 6,00,000 |
| 50 | 16 | 0 | 6,00,000 |
| 51 | 17 | 0 | 6,00,000 |
| 52 | 18 | 0 | 6,00,000 |
| 53 | 19 | 0 | 6,00,000 |
| 54 | 20 | 0 | 6,00,000 |
| 55 | 18,00,000 | ||
| IRR | 5.28% |
While the certainty of guaranteed benefits may appeal to conservative investors, the return is relatively modest and compares unfavourably with several other low-risk investment avenues.
Over a long investment horizon, such returns may struggle to generate sufficient wealth after accounting for inflation, reducing the plan’s effectiveness in meeting major financial goals such as a child’s higher education.
In addition, the life cover provided under the plan is relatively low and may not offer meaningful financial protection to the family.
Overall, the Aviva Bharat Bal Vikas Yojana Plan falls short on both wealth creation and insurance protection, making it difficult to justify as a core component of a well-diversified financial portfolio.
To evaluate the effectiveness of the Aviva Bharat Bal Vikas Yojana Plan, let us compare it with a strategy that separates insurance and investment using the same assumptions as in the previous illustration.
While the plan combines life cover and investment, analysing these components independently provides a clearer picture of its overall value.
A pure-term life insurance policy offering a sum assured of ₹6 lakhs costs approximately ₹5,600 per year for a 20-year policy term with a 10-year premium payment term.
This leaves ₹54,400 annually available for investment. Moreover, since the term insurance premium ends after 10 years, the entire ₹60,000 can be invested during the remaining five years, further enhancing wealth creation.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 6,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | 15 years |
| Annualised Premium | ₹ 5,600 |
| Investment | ₹ 54,400 |
The investment can be tailored to the investor’s risk profile. For this comparison, two alternatives have been considered: Public Provident Fund (PPF) for conservative investors and an Equity Mutual Fund for investors seeking long-term growth.
| 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 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 36 | 2 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 37 | 3 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 38 | 4 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 39 | 5 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 40 | 6 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 41 | 7 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 42 | 8 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 43 | 9 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 44 | 10 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 45 | 11 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 46 | 12 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 47 | 13 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 48 | 14 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 49 | 15 | -60,000 | 6,00,000 | -60,000 | 6,00,000 |
| 50 | 16 | 0 | 6,00,000 | 0 | 6,00,000 |
| 51 | 17 | 0 | 6,00,000 | 0 | 6,00,000 |
| 52 | 18 | 0 | 6,00,000 | 0 | 6,00,000 |
| 53 | 19 | 0 | 6,00,000 | 0 | 6,00,000 |
| 54 | 20 | 0 | 6,00,000 | 0 | 6,00,000 |
| 55 | 21,27,717 | 36,85,145 | |||
| IRR | 6.54% | 10.65% | |||
| Equity Mutual Fund Tax Calculation | |
| Maturity value after 20 years | 40,73,166 |
| Purchase price | 8,44,000 |
| Long-Term Capital Gains | 32,29,166 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 31,04,166 |
| Tax paid on LTCG | 3,88,021 |
| Maturity value after tax | 36,85,145 |
The comparison highlights that separating insurance from investment can potentially generate significantly higher long-term wealth while continuing to provide the required life cover.
By choosing investment avenues that match your risk appetite and financial goals, you can build a substantially larger corpus than what the Aviva Bharat Bal Vikas Yojana Plan offers. Overall, the plan falls short in delivering both adequate insurance protection and competitive long-term investment returns.
The Aviva Bharat Bal Vikas Yojana Plan offers guaranteed benefits, which may appeal to investors seeking certainty.
However, for long-term financial goals, guarantees alone should not be the deciding factor.
The key consideration should be whether the investment can generate returns that consistently outpace inflation and help build the corpus required to achieve your goals.
Our analysis indicates that although the plan provides guaranteed maturity benefits, the returns are relatively modest and are unlikely to keep pace with the increasing cost of future expenses.
As a result, the plan may not accumulate an adequate corpus to fund major goals such as your child’s higher education or other long-term financial objectives and it also has a high agent commission
Another significant limitation of the plan is that it combines insurance and investment into a single product.
In most cases, these objectives are better addressed separately.
A pure-term life insurance policy can provide adequate financial protection for your family at a much lower cost, while the remaining savings can be invested in suitable avenues based on your risk profile and investment horizon, offering greater potential for long-term wealth creation.
Do Quora, Facebook, and Twitter have the final say when it comes to financial advice?
For a strategy tailored to your financial goals, risk appetite, and time horizon, consider consulting a Certified Financial Planner (CFP).
A personalised financial plan can help you allocate your savings efficiently, secure your family’s financial future, and build the corpus needed to achieve your life goals.
Listen to this article Have you ever promised yourself that you would start investing from…
Listen to this article Quick Summary What Works What Doesn't A headline long-term track record:…
Listen to this article ₹1 crore today will be worth roughly ₹37.7 lakh in 20…
Listen to this article Quick Summary What Works What Doesn't Genuine contrarian, valuation-conscious philosophy with…
Listen to this article Quick Summary What Works What Doesn't Genuine, disciplined pure-play SmallCap mandate…
Listen to this article "How much money do I need to retire?" It's one of…