Bajaj Allianz Life Magnum Fortune Plus III Plan : Good or Bad? An Insightful ULIP Review

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Does the Bajaj Allianz Life Magnum Fortune Plus III Plan offer the perfect balance of investment growth and insurance coverage, or does it fall short of its promise?

Is the Magnum Fortune Plus III Plan your key to long-term financial security, or just another ULIP with limited benefits?

Is investing in the Bajaj Allianz Life Magnum Fortune Plus III Plan a wise move for your portfolio, or could you be settling for less?

This review takes a detailed look at the plan’s features, benefits, pros, and cons to help you make an informed decision.

What is the Bajaj Allianz Life Magnum Fortune Plus III?

Bajaj Allianz Life Magnum Fortune Plus III is a unit-linked nonparticipating individual life savings insurance plan. It offers life insurance during the entire policy term and flexibility to choose from a wide range of funds to meet your future goals.

What are the features of the Bajaj Allianz Life Magnum Fortune Plus III?

Enjoy life insurance coverage throughout the Bajaj Allianz Life Magnum Fortune Plus III Plan policy term, ensuring financial protection for your loved ones.
Customise your investment with a variety of fund options and portfolio strategies tailored to your savings goals.
Boost your savings with loyalty additions starting from the 10^th policy year.
Receive a return of mortality charges if you stay invested until maturity.
Choose from three premium bands to align with your financial capacity and savings objectives.
Access your money through partial withdrawals after completing 5 policy years.
Avail potential tax benefits on premiums paid and payouts received, as per the prevailing tax regulations.

Who is eligible for the Bajaj Allianz Life Magnum Fortune Plus III?

Min/ Max age at entry	0/65
Min/ Max age at maturity	18/75
Policy Term / Premium Paying Term	PT	PPT
	10	5 to 7
	15	5 to 10
	20	5 to 15
	25	5 to 20
	30	5 to 25
Minimum Sum Assured	7 times of annualised premium
Maximum Sum Assured	Age	Premium Multiplier
	0 to30	40 times
	31 to 40	30 times
	41 to 45	15 times
	46 to 65	10 times
Premium payment frequency	Yearly, half-yearly, quarterly, monthly

What are the benefits of the Bajaj Allianz Life Magnum Fortune Plus III?

1.Maturity benefit

On Maturity of the Bajaj Allianz Life Magnum Fortune Plus III Plan Policy, you will receive the Fund Value, including the Top-Up Premium Fund Value, if any.

You will have an option to receive the Maturity Benefit as a lump sum or as a structured payout for a maximum of five years using the Settlement Option.

2.Death benefit

In the unfortunate event of the Death of the Life Assured during the Bajaj Allianz Life Magnum Fortune Plus III Plan Policy Term, if all due premiums are paid up to date and the policy is in force, the death benefit will be

The higher of the Prevailing Sum Assured or the Regular Premium Fund Value Plus
The higher of the Top-up sum assured or the top-up premium fund value

Other benefits

Loyalty additions

Additional units will be allocated to your policy from the end of the 10^th policy year, every year till the end of the Bajaj Allianz Life Magnum Fortune Plus III Plan policy term.

Maturity Booster

Maturity Booster as a percentage of the average Regular Premium Fund Value of the last three (3) policy years (including the current year) of your Fund Value, to reward you for staying invested

Return of mortality charges (ROMC)

At the end of the Bajaj Allianz Life Magnum Fortune Plus III Plan Policy term, on the date of Maturity of your Policy, the total amount of Mortality charges deducted in respect of life cover provided throughout the Policy term will be added back.

What are the investment strategies and fund options in the Bajaj Allianz Life Magnum Fortune Plus III?

Investor-selectable portfolio strategy

This strategy enables you to manage your money actively. Under this strategy, you can choose to save your money in any of the following funds in proportion to your choice. The details of the funds are given below:

		Asset Allocation
S.no	Fund Name	Equity	Debt	Money Market	Risk profile
1	Equity Growth Fund II	Not less than 60%	0% – 40%	0% – 40%	Very High
2	Accelerator Mid-Cap Fund II	Not less than 60% (at least 50% in Mid cap)	0% – 40%	0% – 40%	Very High
3	Pure Stock Fund	Not less than 60%	0% – 40%	0% – 40%	Very High
4	Pure Stock Fund II	Not less than 75%	—	0% -25%	Very High
5	Blue-chip Equity Fund	Not less than 60%	0% – 40%	0% – 40%	High
6	Asset Allocation Fund II	40% – 90%	0% – 60%	0% – 50%	High
7	Flexi Cap Fund	65% – 100%	0% – 35%	0% – 35%	Very High
8	Sustainable Equity Fund	65% – 100%	0% – 35%	0% – 35%	Very High
9	Small Cap Fund	65% – 100%	0% – 35%	0% – 35%	Very High
10	Dynamic Asset Allocation Fund	10% 90%	10% 90%	0% – 80%	High
11	Individual Short-Term Debt Fund	—	40% – 100%	0% – 60%	Moderate
12	Bond Fund	—	40% – 100%	0% – 60%	Moderate
13	Midcap Index Fund	65% – 100%	0% – 35%	0% – 35%	Very High
14	Liquid Fund	—	—	100%	Low
15	SmallCap Quality Index Fund	65% – 100%	0% – 35%	0% – 35%	Very High
16	Nifty Alpha 50 Index Fund	65% – 100%	0% – 35%	0% – 35%	Very High
17	Nifty 200 Alpha 30 Index Fund	65% – 100%	0% – 35%	0% – 35%	Very High
18	Nifty 200 Momentum 30 Index Fund Risk	65% – 100%	0% – 35%	0% – 35%	Very High
19	Nifty 500 Multicap Momentum Quality 50 Index Fund	65% – 100%	0% – 35%	0% – 35%	Very High
20	Focused 25 Fund	65% – 100%	0% – 35%	0% – 35%	Very High

Target Asset Allocation Strategy – Analysis

This strategy enables you to choose an Asset Allocation that is best suited to your risk appetite and maintain it throughout the Bajaj Allianz Life Magnum Fortune Plus III Plan Policy Term. The premium can be split in any combination between any two of the eligible funds under this policy.

Every three months, the portfolio will be rebalanced to make sure that this asset allocation is maintained.

Automatic Transfer Portfolio Strategy – Analysis

This method assists you in making systematic investments by automatically moving your funds each month from a low-risk fund to the fund or funds of your choice. Under this portfolio strategy, you have to choose the following:

The low-risk fund (i.e., Bond Fund or Liquid Fund)
The fund(s) to which the money will be transferred every month

At the start of each monthly anniversary of the Policy, a proportion (as mentioned below) of the 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 in the Bajaj Allianz Life Magnum Fortune Plus III?

Premium Allocation Charge

A certain percentage of each limited premium will be allocated to purchase units at the prevailing unit price, and the balance shall be taken as Premium Allocation Charge. It will be based on the premium band and the Bajaj Allianz Life Magnum Fortune Plus III Plan policy year.

Policy Administration charge

The charge is applicable throughout the Policy Term and will be deducted at each monthly anniversary. A charge of 2.1% of the prevailing annualised premium or 500 per month, whichever is lower, is deducted.

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%
Nifty Alpha 50 Index Fund	1.35%
Nifty 200 Alpha 30 Index Fund	1.35%
Nifty 200 Momentum 30 Index Fund Risk	1.35%
Nifty 500 Multicap Momentum Quality 50 Index Fund	1.35%
Discontinued Life Policy Fund	0.50%
Focused 25 Fund	1.35%

Mortality Charges

Mortality Charges will be deducted at each monthly anniversary upon the cancellation of units. Female Life Assured will be eligible for an age setback of 3 years.

Premium discontinuance/ surrender charges

It depends on the year of discontinuance and the premium amount. From the 5^th policy year, there are no Premium discontinuance/ surrender charges.

Miscellaneous charge

The miscellaneous charge would be charged at the rate of Rs.100/- per transaction.

Inference from the charges: These charges are specific to ULIPs and are not applicable to most other investment options. Apart from the fund management and mortality charges, the additional fees imposed under ULIPs act as a burden on investors.

These cumulative charges erode the overall returns, making ULIPs a less attractive choice compared to other, more cost-efficient investment avenues.

Grace Period, Discontinuance and Revival of Bajaj Allianz Life Magnum Fortune Plus III

Grace period

A Grace Period of 30 days for yearly, half-yearly, and quarterly Premium payment frequency, and 15 days are available for monthly Premium payment frequency from the due date of the Regular Premium payment.

Discontinuance

On Discontinuance of Regular Premiums due during the first 5 Policy years – the Bajaj Allianz Life Magnum Fortune Plus III Plan Policy will be converted immediately to a Discontinued Policy at the end of the Grace period.

The Fund Value less the Discontinuance/Surrender charge 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 5 Policy years or at the end of the revival period, whichever is later.

On Discontinuance of Regular Premiums due after the lock-in period of 5 Policy years – the Policy will be converted to a Paid-up Policy at the end of the grace period.

The Paid-up Sum Assured will be the prevailing Sum Assured in the Policy multiplied by the proportion of the number of Premiums paid to the number of Premiums payable in the Policy.

Revival

Bajaj Life Magnum Fortune Plus II Policy can be revived within 3 years from the date of the first unpaid premium.

Free Look-Up Period of Bajaj Life Magnum Fortune Plus III

If you are not satisfied with the terms and conditions of the Bajaj Allianz Life Magnum Fortune Plus III Plan policy, then it can be returned within 30 days beginning from the date of receipt of the policy document, whether received electronically or otherwise.

Surrendering the Bajaj Allianz Life Magnum Fortune Plus III

On surrender during the lock-in period of the first five years of your Policy, the Fund Value, less the applicable Discontinuance/Surrender charge, as on the Date of Surrender, will be transferred to the Discontinued Life Policy Fund and risk cover under the Bajaj Allianz Life Magnum Fortune Plus III Plan Policy shall cease immediately.

And receive the discontinuance value (as surrender benefit) at the end of the lock-in period of five (5) policy years or the date of surrender, whichever is later.

On surrender after the lock-in period of the first five years of your Policy, the surrender value available will be Fund Value, as on the date of surrender, and will be payable immediately.

What are the advantages of the Bajaj Allianz Life Magnum Fortune Plus III?

Opt for a Systematic Withdrawal Plan to receive regular payouts from your policy.
Reduce the Sum Assured at any policy anniversary, as per your changing needs.
Make Top-Up premium payments anytime during the policy term, except in the last five years.
Modify your policy by changing the premium payment term, extending the policy term, or adjusting the payment frequency.
After completing the first five policy years, you can choose to reduce your ongoing premium.
Enjoy the flexibility to switch between investment funds anytime without incurring any charges.

What are the disadvantages of the Bajaj Allianz Life Magnum Fortune Plus III?

The plan comes with a lock-in period of five years.
Loan facility is not available under this Bajaj Allianz Life Magnum Fortune Plus III Plan policy.
Premiums are invested only after various charges are deducted. While the plan promises to return mortality charges at maturity, it does not account for the time value of money.
The availability of multiple fund options may lead to confusion for investors who are not financially savvy.

Research Methodology of Bajaj Allianz Life Magnum Fortune Plus III

Bajaj Allianz Life Magnum Fortune Plus III is a market-linked insurance plan, where the final fund value depends entirely on market performance. To make an informed decision, it’s important to assess the potential returns.

Based on figures from the Bajaj Allianz Life Magnum Fortune Plus III Plan policy brochure, we’ve calculated the Internal Rate of Return (IRR) for a typical scenario.

Benefit Illustration – IRR Analysis of Bajaj Allianz Life Magnum Fortune Plus III

Consider a 35-year-old male aiming to save for his child’s higher education, expected in 15 years. He opts to pay an annual premium of ₹2.5 lakhs for 10 years, with a total policy term of 15 years. Over this period, he contributes a total of ₹25 lakhs.

Male	35 years
Sum Assured	₹ 25,00,000
Policy Term	15 years
Premium Paying Term	10 years
Annualised Premium	₹ 2,50,000

The policy illustration assumes returns at 4% and 8% per annum—purely indicative and not guaranteed. These figures neither represent the best- nor worst-case scenarios.

		At 4% p.a.		At 8% p.a.
Age	Year	Annualised premium / Maturity benefit	Death benefit	Annualised premium / Maturity benefit	Death benefit
35	1	-2,50,000	25,00,000	-2,50,000	25,00,000
36	2	-2,50,000	25,00,000	-2,50,000	25,00,000
37	3	-2,50,000	25,00,000	-2,50,000	25,00,000
38	4	-2,50,000	25,00,000	-2,50,000	25,00,000
39	5	-2,50,000	25,00,000	-2,50,000	25,00,000
40	6	-2,50,000	25,00,000	-2,50,000	25,00,000
41	7	-2,50,000	25,00,000	-2,50,000	25,00,000
42	8	-2,50,000	25,00,000	-2,50,000	25,00,000
43	9	-2,50,000	25,00,000	-2,50,000	25,00,000
44	10	-2,50,000	25,00,000	-2,50,000	25,00,000
45	11	0	25,00,000	0	25,00,000
46	12	0	25,00,000	0	25,00,000
47	13	0	25,00,000	0	25,00,000
48	14	0	25,00,000	0	25,00,000
49	15	0	25,00,000	0	25,00,000
50		31,98,319	25,00,000	48,11,199	25,00,000

	IRR	2.35%		6.28%

At 4% assumed return, the projected fund value is ₹31.98 lakhs, translating to an IRR of just 2.35% as per the Bajaj Allianz Life Magnum Fortune Plus III Plan maturity calculator.

At 8% assumed return, the fund value rises to ₹48.11 lakhs, with an IRR of 6.28% as per the Bajaj Allianz Life Magnum Fortune Plus III Plan maturity calculator.

These returns are underwhelming for a long-term, market-linked product. In fact, the returns may not even match those of traditional debt instruments. For someone aiming to build wealth or achieve long-term financial goals, this plan may fall short.

Bajaj Allianz Life Magnum Fortune Plus III is unlikely to support effective wealth creation or help meet major life goals due to its low return potential.

Bajaj Allianz Life Magnum Fortune Plus III Vs. Other Investments

In a market-linked product, alpha generation—the ability to deliver returns above the benchmark—is crucial. Unfortunately, Bajaj Allianz Life Magnum Fortune Plus III lacks this essential element. Let’s explore alternate options and compare the potential returns.

Bajaj Allianz Life Magnum Fortune Plus III Vs. Pure-term + PPF/ELSS

While this plan offers both life cover and investment, a more efficient approach is to separate the two. For instance, a pure term insurance policy with a ₹25 lakh sum assured for a 35-year-old male (Policy Term: 15 years, Premium Paying Term: 10 years) would cost approximately ₹10,000 per year.

This leaves ₹2,40,000 annually for investment, which can be allocated based on your risk profile.

Pure Term Life Insurance Policy
Sum Assured	₹ 25,00,000
Policy Term	15 years
Premium Paying Term	10 years
Annualised Premium	₹ 10,000
Investment	₹ 2,40,000

To illustrate, we compare two alternatives:

PPF (Public Provident Fund) – a low-risk debt option

ELSS (Equity Linked Savings Scheme) – a tax-saving equity mutual fund

		Term Insurance + PPF		Term insurance + ELSS
Age	Year	Term Insurance premium + PPF	Death benefit	Term Insurance premium + ELSS	Death benefit
35	1	-2,50,000	25,00,000	-2,50,000	25,00,000
36	2	-2,50,000	25,00,000	-2,50,000	25,00,000
37	3	-2,50,000	25,00,000	-2,50,000	25,00,000
38	4	-2,50,000	25,00,000	-2,50,000	25,00,000
39	5	-2,50,000	25,00,000	-2,50,000	25,00,000
40	6	-2,50,000	25,00,000	-2,50,000	25,00,000
41	7	-2,50,000	25,00,000	-2,50,000	25,00,000
42	8	-2,50,000	25,00,000	-2,50,000	25,00,000
43	9	-2,50,000	25,00,000	-2,50,000	25,00,000
44	10	-2,47,500	25,00,000	-2,50,000	25,00,000
45	11	-500	25,00,000	0	25,00,000
46	12	-500	25,00,000	0	25,00,000
47	13	-500	25,00,000	0	25,00,000
48	14	-500	25,00,000	0	25,00,000
49	15	-500	25,00,000	0	25,00,000
50		50,27,325	25,00,000	75,89,624	25,00,000

	IRR	6.70%		10.71%

Investment in PPF

Over 15 years, adjusted for the 10-year contribution structure, the PPF matures at ₹50.27 lakhs, yielding an IRR of 6.70%. This matches the upper-end projection of the ULIP but offers better liquidity and tax benefits under Section 80C and tax-free maturity.

Investment in ELSS

With the same yearly contribution, an ELSS fund could generate a pre-tax corpus of ₹83.13 lakhs. After accounting for long-term capital gains tax, the post-tax maturity value is ₹75.89 lakhs, resulting in an IRR of 10.71%—a return that beats inflation and significantly outperforms the ULIP.

ELSS Tax Calculation
Maturity value after 15 years	83,13,142
Purchase price	24,00,000
Long-Term Capital Gains	59,13,142
Exemption limit	1,25,000
Taxable LTCG	57,88,142
Tax paid on LTCG	7,23,518
Maturity value after tax	75,89,624

This IRR comparison makes it clear that Bajaj Allianz Life Magnum Fortune Plus III underdelivers when it comes to wealth creation. Separating insurance from investment and choosing efficient financial instruments can lead to higher returns, better flexibility, and improved goal achievement.

Final Verdict on Bajaj Allianz Life Magnum Fortune Plus III

Bajaj Allianz Life Magnum Fortune Plus III is a market-linked insurance plan offering a variety of fund options. However, upon closer analysis, it becomes evident that the plan’s potential returns are significantly low.

The primary reason for this underperformance is the lack of transparency in investments. A substantial portion of the premium is consumed by fund administration and other charges, with only the remaining amount actually invested.

Compared to other market-linked investment products, ULIPs tend to have higher charges, making this plan less attractive from a return standpoint and it also has a high agent commission.

To achieve important life goals, your investments must deliver a better risk-adjusted return. For life insurance needs, a pure term plan offers higher coverage at a much lower cost, making it a more efficient choice.

Mixing insurance with market-linked investments is not advisable, as it often compromises both objectives. Instead, focus on building a well-diversified portfolio tailored to your risk profile and financial goals.

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

Consult a qualified financial advisor who can guide you in selecting the right investment products to help you grow your wealth and meet your life goals effectively.

Bajaj Allianz Life Magnum Fortune Plus III Plan : Good or Bad? An Insightful ULIP Review

Table of Contents

What is the Bajaj Allianz Life Magnum Fortune Plus III?

What are the features of the Bajaj Allianz Life Magnum Fortune Plus III?

Who is eligible for the Bajaj Allianz Life Magnum Fortune Plus III?