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Is Bajaj Allianz Life Goal Assure II Your Ticket to Timely Financial Goals?
Can the Bajaj Allianz Life Goal Assure II plan really guarantee that you meet your financial goals on time?
In this article, we’ll take a deep dive into the specifics of the Bajaj Allianz Life Goal Assure II plan by dissecting its advantages and disadvantages and evaluating its performance comprehensively with IRR analysis.
Are you wondering if Bajaj Allianz Life Goal Assure II is the right investment to secure your financial future?
Let’s explore together.
Table of Contents:
What is the Bajaj Allianz Life Goal Assure II Plan?
Who is Eligible for the Bajaj Allianz Life Goal Assure II Plan?
What are the Features of the Bajaj Allianz Life Goal Assure II Plan?
What are the Benefits of Bajaj Allianz Life Goal Assure II Plan?
Investment Strategies & Fund Options of Bajaj Allianz Life Goal Assure II Plan
What are the Charges under the Bajaj Allianz Life Goal Assure II Plan?
Grace period, Discontinuance & Revival of Bajaj Allianz Life Goal Assure II Plan
Free look period of Bajaj Allianz Life Goal Assure II Plan
Surrendering Bajaj Alliance Life Goal Assure II Plan
What are the advantages of the Bajaj Allianz Life Goal Assure II Plan?
What are the disadvantages of Bajaj Allianz Life Goal Assure II?
Research Methodology of Bajaj Allianz Life Goal Assure II Plan
Benefit Illustration – IRR Analysis of Bajaj Allianz Life Goal Assure II Plan
Bajaj Allianz Life Goal Assure II Plan Vs Other investment products
Bajaj Allianz Life Goal Assure II Vs. Pure Term + PPF / ELSS
Final Verdict on Bajaj Allianz Life Goal Assure II
What is the Bajaj Allianz Life Goal Assure II Plan?
Bajaj Allianz Life Goal Assure II is a non-participating, life, individual, Unit-Linked regular/limited premium payment savings plan.
Bajaj Allianz Life Goal Assure II comes with Loyalty Additions payable from the 6th Year and Fund Boosters payable at maturity. Bajaj Allianz Life Goal Assure II also returns the mortality charges on Policy maturity while also offering protection from Day 1.
Who is Eligible for the Bajaj Allianz Life Goal Assure II Plan?
| Age at entry | 0 years | |
| maximum Entry Age | 60 years | |
| Minimum Maturity Age | 18 years | |
| Maximum Maturity Age | 75 years | |
| Policy Term | 5 / 10 /15 /20 years | |
| Premium paying term | Policy term | premium Paying term |
| 5 years | 5 years | |
| 10 years | 5,7, 10 years | |
| 15 years | 5,7, 10 & 15 years | |
| 20 years | 5,7, 10, 15 & 20 years | |
| Premium Payment Frequency | Yearly, Half-yearly, Quarterly and Monthly | |
| Minimum Sum Assured | 7 times Annualized Premium | |
What are the Features of the Bajaj Allianz Life Goal Assure II Plan?
- Return of mortality charges at maturity (ROMC)
- Option to take death or maturity benefits in installments with Return Enhancer
- Choice of 4 investment portfolio strategies & 16 funds options
- Option to reduce the premium, decrease the Sum Assured, and change the Premium payment term.
- Fund Booster at maturity & Loyalty additions from 6th policy year.
What are the Benefits of Bajaj Allianz Life Goal Assure II Plan?
i.) Death benefit
The Death Benefit payable will be:
- Higher of, Prevailing Regular Premium Sum Assured or Regular Premium Fund Value plus
- Higher of, Top-up Sum Assured or Top-up Premium Fund Value
- The Death Benefit is subject to the Guaranteed Death Benefit of 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 Bajaj Allianz Life Goal Assure II Policy is in force.
Investment Strategies & Fund Options of Bajaj Allianz Life Goal Assure II Plan
Bajaj Allianz Life Goal Assure II provides you with four unique portfolio strategies, out of which anyone can be chosen at the inception of your Policy:
- Investor Selectable Portfolio Strategy
- Wheel of Life Portfolio Strategy II
- Trigger Based Portfolio Strategy II
- Auto Transfer Portfolio Strategy
1.) Investor selectable Portfolio Strategy of Bajaj Allianz Life Goal Assure 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 16 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 |
| Debt Plus Fund | — | Not more than 80% | Not less than 20% | Moderate |
2.) Wheel of Life Portfolio Strategy – II of Bajaj Allianz Life Goal Assure II Plan
In this Portfolio Strategy at the commencement of the Bajaj Allianz Life Goal Assure II 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% |
3.) Trigger-Based Portfolio Strategy II of Bajaj Allianz Life Goal Assure II Plan
Under this Portfolio Strategy, Regular/Limited Premiums and Top up Premiums if any, will be allocated between two Funds, Equity Growth Fund II (an equity-oriented Fund), and Bond Fund (a debt-oriented Fund), in a 75%: 25% proportion. The Fund value proportions may subsequently get altered due to market movements.
Any appreciation over three times the value of units is considered a gain and is switched to the Liquid Fund. Later it will be switched to the Equity Growth Fund II and the Bond Fund such that, after the transfer, the ratio of the value of units in the Equity Growth Fund II to that in the Bond Fund is restored to 75%:25%.
4.) Auto Transfer Portfolio Strategy of Bajaj Allianz Life Goal Assure II Plan
This strategy helps you to invest your money systematically by automatically transferring your money every month, from a low-risk Fund to the Fund(s) of your choice. In this Portfolio Strategy, your Premium will be allocated to Bond Fund and/or Liquid Fund, as specified by you.
At the start of each monthly anniversary of the Bajaj Allianz Life Goal Assure II Policy, a proportion (as mentioned below) of Fund value in the Bond Fund and/or Liquid Fund as on that date will be switched to the other Fund/s (available in the plan) as specified by you.
The proportion of Fund value = 1/ Outstanding no. of months till the next premium due date.
What are the Charges under the Bajaj Allianz Life Goal Assure II Plan?
A. Premium Allocation Charge
NIL
B. Policy Administration Charge
₹ 400 per annum inflating at 5% per annum, subject to a maximum 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% |
| Debt plus Fund | 0.70% |
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 & 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 the charges
Bajaj Allianz Life Goal Assure II imposes multiple charges similar to any other ULIP. These charges can significantly diminish returns over an extended period, highlighting a notable contrast when compared to investing in other market-related instruments.
Grace period, Discontinuance & Revival of Bajaj Allianz Life Goal Assure II Plan
Grace period
A grace period of 30 days for yearly, half-yearly & quarterly premium payment frequency, and 15 days is available 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 Goal Assure II 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 Goal Assure II Policy will be, immediately & automatically, converted to a Paid-up Policy.
The Paid-up Sum Assured will be the Sum Assured in the 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 Goal Assure II 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 Goal Assure II Plan
If the policyholder disagrees with any of the terms or conditions, he has the option to return the Bajaj Allianz Life Goal Assure II 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 Goal Assure II Plan
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 the Bajaj Allianz Life Goal Assure II Plan?
- Option to enhance your protection by opting for the rider.
- Flexibility to switch units between your investment funds according to your risk appetite (Investor selectable portfolio strategy)
- At any Policy Anniversary, switch out from any of the four unique portfolio strategies
- Option to reduce the prevailing Regular/Limited Premium under the Policy after the first 5 Policy years.
- Top-up premium is allowed at any time except during the last five Policy years.
What are the disadvantages of Bajaj Allianz Life Goal Assure II?
- No loan facility is available in Bajaj Allianz Life Goal Assure II.
- There is no liquidity during the first 5 policy years.
- The sum assured is too low to cover the future needs of the family.
Research Methodology of Bajaj Allianz Life Goal Assure II Plan
Let’s dive into some number analysis. We shall calculate the Internal Rate of Return for Bajaj Allianz Life Goal Assure II and then compare that return with other market-linked returns. This comparison should provide valuable insights into the performance.
Benefit Illustration – IRR Analysis of Bajaj Allianz Life Goal Assure II Plan
A 35-year-old male has taken a Bajaj Allianz Life Goal Assure II Policy for which he is paying a Premium of ₹ 50,000 p.a. for a payment term of 10 years with a Sum Assured of ₹ 5,00,000 Lakhs. He has chosen a Policy term of 15 years.
Let’s see the benefits available under the Bajaj Allianz Life Goal Assure II Policy.
| Male | 35 years |
| Sum Assured | ₹ 5,00,000 |
| Policy Term | 15 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 50,000 |
At the end of the policy term, he receives the maturity benefit i.e., the fund value. 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 Goal Assure II 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 | 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 | 6,50,581 | 9,70,742 | |||
| IRR | 2.51% | 6.36% | |||
Based on the Bajaj Allianz Life Goal Assure II Plan Maturity Value Calculator, in the 4% scenario, the fund value stands at ₹6.50 Lakhs, with an IRR of 2.51%. On the other hand, in the 8% scenario, the fund value stands at ₹9.70 Lakhs, with an IRR of 6.36%.
However, despite being a market-linked product, Bajaj Allianz Life Goal Assure II offers returns significantly lower than inflation. Consequently, these returns won’t contribute effectively to wealth accumulation.
Bajaj Allianz Life Goal Assure II Plan Vs Other investment products
Let’s now examine returns from other market-linked investments. It’s crucial that returns from long-term investments surpass inflation. Therefore, we’ll explore alternative investments where you can achieve a better yield.
A pure-term life insurance policy adequately meets the criteria for life cover. As for wealth accumulation, invest according to risk appetite.
Bajaj Allianz Life Goal Assure II Vs. Pure Term + PPF / ELSS
A pure term life insurance policy offering a sum assured of ₹ 5 Lakhs comes at a cost of ₹3,300. The premium is payable for 10 years, while the policy term spans 15 years.
Contrasting this, in the previous example, the premium was ₹50,000. This leaves you with an annual investment amount of ₹ 46,700.
| Term Insurance + PPF | Term insurance + ELSS | ||||
| Age | Year | Term Insurance premium + PPF | Death benefit | Term Insurance premium + ELSS | 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 | -47,500 | 5,00,000 | -50,000 | 5,00,000 |
| 45 | 11 | -500 | 5,00,000 | 0 | 5,00,000 |
| 46 | 12 | -500 | 5,00,000 | 0 | 5,00,000 |
| 47 | 13 | -500 | 5,00,000 | 0 | 5,00,000 |
| 48 | 14 | -500 | 5,00,000 | 0 | 5,00,000 |
| 49 | 15 | -500 | 5,00,000 | 0 | 5,00,000 |
| 50 | 9,77,680 | 15,12,539 | |||
| IRR | 6.44% | 10.67% | |||
| ELSS Tax Calculation | |
| Maturity value after 15 years | 16,17,599 |
| Purchase price | 4,67,000 |
| Long-Term Capital Gains | 11,50,599 |
| Exemption limit | 1,00,000 |
| Taxable LTCG | 10,50,599 |
| Tax paid on LTCG | 1,05,060 |
| Maturity value after tax | 15,12,539 |
You can opt for either a PPF account or an ELSS fund for investment. The minimum yearly contribution for PPF over 15 years is ₹ 500. The premium paying term here is 10 years. Adjustments are made for the final 5 years in this calculation.
The final maturity value for PPF investment stands at ₹9.77 Lakhs, yielding an IRR of 6.44%.
For ELSS, the final pre-tax maturity value reaches ₹16.17 lakhs. After accounting for capital gains tax, the post-tax maturity value stands at ₹15.12 lakhs. The IRR for a combined pure term and ELSS investment is 10.67%.
This alternative investment method offers better returns and liquidity. In contrast, Bajaj Allianz Life Goal Assure II provides both lower returns and less favourable liquidity.
Final Verdict on Bajaj Allianz Life Goal Assure II
Bajaj Allianz Life Goal Assure II presents an opportunity to channel savings into the market. Typically, market investments should yield returns commensurate with the associated risks.
However, a thorough analysis of returns of Bajaj Allianz Life Goal Assure II reveals that they fall short of expectations due to substantial charges and High Agent commissions.
Investing in Bajaj Allianz Life Goal Assure II results in a deficit in the required corpus for achieving goals. Additionally, the sum assured provided is insufficient to adequately safeguard the family’s financial security. Both the insurance and investment aspects fail to convincingly justify investing in Bajaj Allianz Life Goal Assure II.
Considering your liabilities and objectives, it’s advisable to opt for a term plan with a sufficient sum assured. This ensures adequate protection for your family against uncertainties. Furthermore, the premium rates are reasonable under a pure-term life insurance policy.
For wealth accumulation, construct an investment portfolio aligned with your risk tolerance, goals, and time horizon. Can you rely solely on social media platforms like Quora, Twitter, and Facebook for financial guidance?
While these platforms can offer a starting point for financial information, they are not the most reliable sources for making critical decisions.
Seeking guidance from a Certified Financial Planner (CFP) for goal-oriented investment planning is highly recommended.
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