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Can investing in Bajaj Allianz Life Future Gain II truly guarantee the growth and security you need to reach your future financial goals?
Will the potential market-linked returns of this ULIP be sufficient to meet your long-term aspirations despite market volatility?
Can the dual benefits of insurance coverage and investment really provide the peace of mind and financial stability you seek for the future?
In this review, let’s delve into the features and benefits offered by Bajaj Allianz Life Future Gain II. This comprehensive analysis will provide valuable insights by evaluating the advantages and disadvantages of IRR analysis to aid in your investment decision-making process.
Table of Contents:
What is the Bajaj Allianz Life Future Gain II Plan?
What are the Features of Bajaj Allianz Life Future Gain II Plan?
Who is Eligible for the Bajaj Allianz Life Future Gain II Plan?
What are the Benefits in the Bajaj Allianz Life Future Gain II Plan?
Investment strategies & Fund options
What are the Charges under the Bajaj Allianz Life Future Gain II Plan?
Grace period, Discontinuance & Revival of Bajaj Allianz Life Future Gain II Plan
Free look period of Bajaj Allianz Life Future Gain II Plan
Surrendering Bajaj Alliance Life Future Gain II
What are the Advantages of Bajaj Allianz Life Future Gain II Plan?
What are the Disadvantages of Bajaj Allianz Life Fortune Gain II Plan?
Research Methodology of Bajaj Allianz Life Future Gain II Plan Review
Benefit illustration – IRR calculation of Bajaj Allianz Life Future Gain II Plan
Bajaj Allianz Life Future Gain II Plan Vs Other Investment Products
Bajaj Allianz Life Future Gain II Vs. Pure Term + ELSS
Final Verdict on Bajaj Allianz Life Future Gain II
What is the Bajaj Allianz Life Future Gain II Plan?
Bajaj Allianz Life Future Gain II is a Unit-linked Non- Participating Individual Life Savings Insurance Plan.
Bajaj Allianz Life Future Gain II Plan provides you with a life insurance cover throughout the policy term with maximum premium allocation to funds to make sure that your valuable money is fully utilized towards your dream future.
What are the Features of Bajaj Allianz Life Future Gain II Plan?
- Provides life cover & Maximum premium allocation to funds
- Option to pay Top-up Premium
- Choice of 2 investment portfolio strategies & 15 fund options
- Option to reduce premium & decrease Sum Assured
Who is Eligible for the Bajaj Allianz Life Future Gain II Plan?
| Age at entry | 1 year | |
| maximum Entry Age | 60 years | |
| Minimum Maturity Age | 18 years | |
| Maximum Maturity Age | 70 years | |
| Premium paying term | 5 to 30 years | |
| Policy Term | Policy term | premium Paying term |
| 10,15 to 20 years | 5 or 6 years | |
| 10,15 to 30 years | Other PPT | |
| Premium Payment Frequency | Yearly, Half-yearly, Quarterly and Monthly | |
| Minimum Sum Assured | 7 times Annualized Premium | |
What are the Benefits in the Bajaj Allianz Life Future Gain II Plan?
i.) Death benefit
The Death Benefit payable to the Nominee/Policyholder as a lump sum is:
- The higher of the Prevailing Sum Assured or Regular Premium Fund Value, PLUS
- The higher of Top-up Premium Sum Assured or Top-up Premium Fund Value, if any;
- The Death Benefit is subject to the Guaranteed Death Benefit, which is at least 105% of the Total Premiums paid till the date of death.
ii.) Maturity benefit
The Maturity Benefit will be the Regular Premium Fund Value Plus Top-up Premium Fund Value as of the Maturity Date, provided the Policy is in force.
Investment strategies & Fund options
Bajaj Allianz Life Future Gain II provides you with two unique portfolio strategies, which can be chosen at the inception of your Policy or on any subsequent Policy Anniversary:
- Investor Selectable Portfolio Strategy
- Wheel of Life Portfolio Strategy
1. Investor Selectable Portfolio Strategy of Bajaj Allianz Life Future Gain II Plan
If you want to allocate your Premiums based on your personal choice and decision, you can opt for this Investment Strategy and choose from among the 15 Funds below to suit your investment needs.
| Asset Allocation | ||||
| Fund Name | Equity | Debt | Money Market | Risk profile |
| Equity Growth Fund II | Not less than 60% | 0% – 40% | 0% – 40% | Very High |
| Accelerator Mid-Cap Fund II | Not less than 60% (at least 50% in Mid-cap) | 0% – 40% | 0% – 40% | Very High |
| Pure Stock Fund | Not less than 60% | 0% – 40% | 0% – 40% | Very High |
| Pure Stock Fund II | Not less than 75% | — | 0% -25% | Very High |
| Asset Allocation Fund II | 40% – 90% | 0% – 60% | 0% – 50% | High |
| Blue-chip Equity Fund | Not less than 60% | 0% – 40% | 0% – 40% | High |
| Bond Fund | — | 40% – 100% | 0% – 60% | Moderate |
| Liquid Fund | — | — | 100% | Low |
| Flexi Cap Fund | 65% – 100% | 0% – 35% | 0% – 35% | Very High |
| Sustainable Equity Fund | 65% – 100% | 0% – 35% | 0% – 35% | Very High |
| Small Cap Fund | 65% – 100% | 0% – 35% | 0% – 35% | Very High |
| Midcap Index Fund | 65% – 100% | 0% – 35% | 0% – 35% | Very High |
| Dynamic Asset Allocation Fund | 10% 90% | 10% 90% | 0% – 80% | High |
| SmallCap Quality Index Fund | 65% – 100% | 0% – 35% | 0% – 35% | Very High |
| Individual Short-Term Debt Fund | — | 40% – 100% | 0% – 60% | Moderate |
2. Wheel of Life Portfolio Strategy – II of Bajaj Allianz Life Future Gain II Plan
In this Portfolio Strategy at the commencement of the Bajaj Allianz Life Future Gain II Plan Policy, the Regular/Limited Premium, and the Top up Premium, if any, would be allocated in the Funds mentioned (namely Blue-chip Equity, Equity Growth Fund II, Accelerator Mid-Cap Fund II, Bond Fund & Liquid Fund) in the proportion as mentioned in the table below, depending on the outstanding years to maturity.
| Proportion | ||||||
| Years to Maturity | Blue-chip Equity Fund | Equity Growth Fund II | Accelerator Mid-Cap Fund II | Bond Fund | Liquid Fund | Total |
| 20 & above | 20% | 50% | 30% | 0% | 0% | 100% |
| 19 | 30% | 50% | 20% | 0% | 0% | 100% |
| 18 | 30% | 50% | 20% | 0% | 0% | 100% |
| 17 | 30% | 50% | 20% | 0% | 0% | 100% |
| 16 | 30% | 50% | 20% | 0% | 0% | 100% |
| 15 | 40% | 40% | 15% | 5% | 0% | 100% |
| 14 | 40% | 40% | 10% | 10% | 0% | 100% |
| 13 | 40% | 40% | 5% | 15% | 0% | 100% |
| 12 | 40% | 40% | 0% | 20% | 0% | 100% |
| 11 | 40% | 35% | 0% | 25% | 0% | 100% |
| 10 | 40% | 30% | 0% | 30% | 0% | 100% |
| 9 | 40% | 25% | 0% | 35% | 0% | 100% |
| 8 | 40% | 20% | 0% | 40% | 0% | 100% |
| 7 | 40% | 15% | 0% | 45% | 0% | 100% |
| 6 | 40% | 10% | 0% | 50% | 0% | 100% |
| 5 | 40% | 0% | 0% | 55% | 0% | 95% |
| 4 | 30% | 0% | 0% | 60% | 10% | 100% |
| 3 | 20% | 0% | 0% | 65% | 15% | 100% |
| 2 | 10% | 0% | 0% | 70% | 20% | 100% |
| 1 | 0% | 0% | 0% | 80% | 20% | 100% |
What are the Charges under the Bajaj Allianz Life Future Gain II Plan?
A. Premium Allocation charge
B. Policy Administration Charge
₹ 33.33 per month inflating at 5% per annum every month, subject to a max of ₹ 500 per month.
C. Fund Management Charge
| Fund Name | Fund Management Charge |
| Equity Growth Fund II | 1.35% |
| Accelerator Mid-Cap Fund II | 1.35% |
| Pure Stock Fund | 1.35% |
| Pure Stock Fund II | 1.30% |
| Asset Allocation Fund II | 1.25% |
| Blue-chip Equity Fund | 1.25% |
| Bond Fund | 0.95% |
| Liquid Fund | 0.95% |
| Flexi Cap Fund | 1.35% |
| Sustainable Equity Fund | 1.35% |
| Small Cap Fund | 1.35% |
| Midcap Index Fund | 1.35% |
| Dynamic Asset Allocation Fund | 1.35% |
| SmallCap Quality Index Fund | 1.35% |
| Individual Short-Term Debt Fund | 0.95% |
| Discontinued Life Policy Fund | 0.50% |
D. Miscellaneous Charge
A miscellaneous charge of Rs. 100 per transaction will be charged.
E. Discontinuance /Surrender Charge
It depends on the Annual premium amount and the year of discontinuance or surrender. There is no Discontinuance /Surrender Charge from the 5th policy year.
F. Mortality Charge
Mortality Charges will be deducted at each monthly anniversary by the cancellation of units. Female Life Assured will be eligible for an age setback of 3 years.
Inference from Charges
Similar to many other ULIPs, Bajaj Allianz Life Future Gain II entails various charges. These charges have the potential to substantially reduce returns over the long term, showcasing a significant disparity when compared to investments in other market-related instruments.
Grace period, Discontinuance & Revival of Bajaj Allianz Life Future Gain II Plan
Grace period
A grace period of 30 days for yearly, half-yearly and quarterly premium payment frequency, and 15 days is available on Bajaj Allianz Life Future Gain II Plan for monthly premium payment frequency from the due date of Regular/Limited Premium payment.
Discontinuance
On Discontinuance of Regular Premiums due during the first 5 Policy years, the Bajaj Allianz Life Future Gain II Plan Policy will be converted to a Discontinued Life Policy, and the Regular Premium Fund Value less the Discontinuance/Surrender charge along with Top-up Premium Fund Value, if any, will be transferred to the Discontinued Life Policy fund.
The Discontinuance Value shall be payable as the Surrender Benefit at the end of the lock-in period of five Policy years.
On Discontinuance of Regular Premiums due after the lock-in period of 5 Policy years, the Bajaj Allianz Life Future Gain II Plan Policy will be, immediately and automatically, converted to a Paid-up Policy.
The Paid-up Sum Assured will be the Sum Assured in the Bajaj Allianz Life Future Gain II Plan Policy multiplied by the proportion of the number of Regular Premiums paid to the number of Regular Premiums payable in the Policy.
Revival
A Bajaj Allianz Life Future Gain II Plan policy that has been discontinued or is paid up due to non-payment of premiums can only be revived within 3 years from the date of the first unpaid premium.
Free look period of Bajaj Allianz Life Future Gain II Plan
If the policyholder disagrees with any of the terms or conditions, he has the option to return the Bajaj Allianz Life Future Gain II Plan policy within 15 days from the date of receipt of the policy document and a period of 30 days in case of electronic policies and policies obtained through distance mode.
Surrendering Bajaj Alliance Life Future Gain II
During the lock-in period of the first 5 policy years: The Regular Premium Fund Value less the discontinuance/ surrender charge, along with the Top-Up Premium Fund Value, if any, as on the date of surrender, will be credited to the Discontinued Life Policy Fund. The Discontinuance Value, at the end of the Lock-in Period, will be payable to the Policyholder as Surrender Value.
On surrender after the lock-in period, the surrender value available will be the Total Fund Value as of the date of surrender.
What are the Advantages of Bajaj Allianz Life Future Gain II Plan?
- Enjoy extra coverage by choosing the optional additional rider benefits.
- Option to make partial withdrawals, any time after the fifth Policy Year.
- Flexibility to switch units between your investment funds according to your risk appetite (Investor Selectable Portfolio Strategy)
- At any Bajaj Allianz Life Future Gain II Plan Policy Anniversary, you can change from an Investor selectable Portfolio Strategy to a Wheel of Life Portfolio Strategy and vice-versa.
- Option to change the premium payment term (PPT) and Premium paying frequency.
- Option to receive your Maturity Benefit / Death benefit in installments.
What are the Disadvantages of Bajaj Allianz Life Fortune Gain II Plan?
- The Bajaj Allianz Life Future Gain II Plan does not offer any liquidity during the first five policy years.
- No loan facility is available under the Bajaj Allianz Life Future Gain II Plan.
- Asset allocation under the Fund options looks similar. So, fund options look repetitive.
Research Methodology of Bajaj Allianz Life Future Gain II Plan Review
In this section, we will assess the Bajaj Allianz Life Future Gain II Plan’s return as a percentage. This evaluation will help you compare it with other market-related instruments, enabling you to make well-informed decisions.
To illustrate this, we will calculate the Internal Rate of Return (IRR) based on the benefit illustration and Bajaj Allianz Life Future Gain II Plan Maturity Calculator provided in the policy brochure.
Benefit illustration – IRR calculation of Bajaj Allianz Life Future Gain II Plan
A 35-year-old male opts for the Bajaj Allianz Life Future Gain II Policy for a Policy Term (PT) of 24 years. He has decided to pay Rs. 50,000 as an Annualized Premium for a Premium Paying Term of 20 years. The Sum Assured chosen by him is Rs. 7,00,000.
| Male | 35 years |
| Sum Assured | ₹ 7,00,000 |
| Policy Term | 24 years |
| Premium Paying Term | 20 years |
| Annualised Premium | ₹ 50,000 |
The premium is paid for a limited period and the fund value is valuable and is available at the end of the Bajaj Allianz Life Future Gain II Plan policy term. The returns indicated at 4% and 8% are illustrative and not guaranteed and do not indicate the upper or lower limits of returns under the Bajaj Allianz Life Future Gain II Plan Policy.
| 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 | 7,00,000 | -50,000 | 7,00,000 |
| 36 | 2 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 37 | 3 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 38 | 4 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 39 | 5 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 40 | 6 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 41 | 7 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 42 | 8 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 43 | 9 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 44 | 10 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 45 | 11 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 46 | 12 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 47 | 13 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 48 | 14 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 49 | 15 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 50 | 16 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 51 | 17 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 52 | 18 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 53 | 19 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 54 | 20 | -50,000 | 7,00,000 | -50,000 | 7,00,000 |
| 55 | 21 | 0 | 7,00,000 | 0 | 7,00,000 |
| 56 | 22 | 0 | 7,00,000 | 0 | 7,00,000 |
| 57 | 23 | 0 | 7,00,000 | 0 | 7,00,000 |
| 58 | 24 | 0 | 7,00,000 | 0 | 7,00,000 |
| 59 | 13,72,113 | 7,00,000 | 24,98,396 | 7,00,000 | |
| IRR | 2.15% | 6.10% | |||
Based on the Bajaj Allianz Life Future Gain II Plan Maturity Calculator, in the 4% scenario, the fund value is ₹13.72 lakhs, resulting in an IRR of 2.15%. In the 8% scenario, the fund value is ₹24.98 lakhs, with an IRR of 6.10%.
Despite the 24-year policy term, which constitutes a long-term investment, the returns are not satisfactory and do not justify the risk taken. Therefore, investing in Bajaj Allianz Life Future Gain II may not be beneficial for wealth accumulation.
Bajaj Allianz Life Future Gain II Plan Vs Other Investment Products
Other market-related products offer better returns and liquidity compared to Bajaj Allianz Life Future Gain II. In this section, let’s compute the return on an alternate investment strategy. This strategy combines a Pure Term Life Insurance Policy for life cover and investments for wealth accumulation.
Bajaj Allianz Life Future Gain II Vs. Pure Term + ELSS
For comparison, we’ll use the same metrics as in the previous illustration. A Pure Term Life Insurance policy with a sum assured of ₹7 lakhs costs ₹7,400 annually.
The policy term is 24 years, with a premium paying term of 10 years. In the initial 10 years, the term life insurance premium of ₹7,400 is paid, and the remaining ₹42,600 is invested. For the next 10 years, the full amount of ₹50,000 is invested.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 1 crore |
| Policy Term | 24 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 7,400 |
| Investment | ₹ 42,600 |
We have chosen an ELSS fund for the market-related investment. If you have a low-risk appetite, you can opt for a low-risk debt investment option like PPF.
| Term insurance + ELSS | |||
| Age | Year | Term Insurance premium + ELSS | Death benefit |
| 35 | 1 | -50,000 | 7,00,000 |
| 36 | 2 | -50,000 | 7,00,000 |
| 37 | 3 | -50,000 | 7,00,000 |
| 38 | 4 | -50,000 | 7,00,000 |
| 39 | 5 | -50,000 | 7,00,000 |
| 40 | 6 | -50,000 | 7,00,000 |
| 41 | 7 | -50,000 | 7,00,000 |
| 42 | 8 | -50,000 | 7,00,000 |
| 43 | 9 | -50,000 | 7,00,000 |
| 44 | 10 | -50,000 | 7,00,000 |
| 45 | 11 | -50,000 | 7,00,000 |
| 46 | 12 | -50,000 | 7,00,000 |
| 47 | 13 | -50,000 | 7,00,000 |
| 48 | 14 | -50,000 | 7,00,000 |
| 49 | 15 | -50,000 | 7,00,000 |
| 50 | 16 | -50,000 | 7,00,000 |
| 51 | 17 | -50,000 | 7,00,000 |
| 52 | 18 | -50,000 | 7,00,000 |
| 53 | 19 | -50,000 | 7,00,000 |
| 54 | 20 | -50,000 | 7,00,000 |
| 55 | 21 | 0 | 7,00,000 |
| 56 | 22 | 0 | 7,00,000 |
| 57 | 23 | 0 | 7,00,000 |
| 58 | 24 | 0 | 7,00,000 |
| 59 | 51,77,025 | 7,00,000 | |
| IRR | 10.73% | ||
The ELSS fund value at the end of the term amounts to ₹56.38 lakhs, which is subject to capital gains tax. The post-tax value is ₹51.77 lakhs, with an IRR of 10.73% for the combined Pure Term Life Insurance policy and ELSS investment.
| ELSS Tax Calculation | |
| Maturity value after 24 years | 56,38,250 |
| Purchase price | 9,26,000 |
| Long-Term Capital Gains | 47,12,250 |
| Exemption limit | 1,00,000 |
| Taxable LTCG | 46,12,250 |
| Tax paid on LTCG | 4,61,225 |
| Maturity value after tax | 51,77,025 |
Following this alternate investment strategy offers better yields and liquidity. Unlike Bajaj Allianz Life Future Gain II, which has issues with returns and liquidity, this strategy allows you to liquidate your investment at any time.
Final Verdict on Bajaj Allianz Life Future Gain II
Under the Bajaj Allianz Life Future Gain II plan, you pay premiums for a limited period, and the fund value is available at the end of the policy term. There are no loyalty additions or fund boosters; it is a basic ULIP plan with substantial charges due to the high agent commission and other reasons.
One of the primary reasons for investing in market-related instruments is to achieve returns that outpace inflation. However, the returns provided by Bajaj Allianz Life Future Gain II are not compelling, and the sum assured is relatively low. Therefore, combining life cover with market-related investments is not an optimal solution.
Opting for a pure-term life insurance policy is the best option for life cover. To achieve your future financial goals, focus on investing and building a diversified investment portfolio.
Is it wise to depend entirely on social media platforms like Quora, Twitter, and Facebook for financial guidance? Although these platforms can provide a useful starting point for financial information, they are not the most dependable sources for making crucial decisions.
Consulting a financial planner can help you navigate the financial landscape, creating a custom financial plan based on your risk appetite, goals, and time horizon.
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