HDFC Life Click 2 Invest Plus Plan: Good or Bad? A Detailed ULIP Review
Can the HDFC Life Click 2 Invest Plus help you achieve your long-term financial goals?
Is the HDFC Life Click 2 Invest Plus an effective investment option for long-term wealth creation?
What are the key features, benefits, and investment options available under the HDFC Life Click 2 Invest Plus?
Does the HDFC Life Click 2 Invest Plus align with your financial objectives?
In this article, we examine the plan’s key features, available options, and benefits to help you understand how it works and whether it aligns with your financial objectives.
1. What is the HDFC Life Click 2 Invest Plus?
2. What are the features of the HDFC Life Click 2 Invest Plus?
3. Who is eligible for the HDFC Life Click 2 Invest Plus?
4. What are the benefits of the HDFC Life Click 2 Invest Plus?
5. What are the fund options in the HDFC Life Click 2 Invest Plus?
6. What are the charges in the HDFC Life Click 2 Invest Plus?
7. Grace Period, Discontinuance and Revival of the HDFC Life Click 2 Invest Plus
8. Free Look Period for the HDFC Life Click 2 Invest Plus
9. Surrendering the HDFC Life Click 2 Invest Plus
10. What are the advantages of the HDFC Life Click 2 Invest Plus?
11. What are the disadvantages of the HDFC Life Click 2 Invest Plus?
12. Research Methodology of HDFC Life Click 2 Invest Plus
Benefit Illustration – IRR Analysis of HDFC Life Click 2 Invest Plus
13. HDFC Life Click 2 Invest Plus Vs. Other Investments
HDFC Life Click 2 Invest Plus Vs. Pure-term + PPF/Equity Mutual Fund
14. Final Verdict on the HDFC Life Click 2 Invest Plus
HDFC Life Click 2 Invest Plus Plan is a Unit Linked Non-Participating Individual Life Insurance Savings Plan.
It offers financial protection for your family with market-linked returns.
Along with financial protection, this plan also offers you a range of investment funds.
You can choose from among 10 fund options to invest your money in.
Choice of 3 Plan options
You can choose any of the four Death Benefit Options listed below.
The benefit is paid to the nominee in case of unfortunate death of the Life Assured during the HDFC Life Click 2 Invest Plus Plan policy term.
This option has to be chosen at inception only.
| DEATH BENEFIT OPTION | DEATH BENEFIT shall be: |
| Classic | Higher of Sum Assured OR Fund Value |
| Classic Plus | Sum Assured PLUS Fund Value |
| Classic Waiver | Sum Assured PLUS Waiver of Future Premiums |
| Classic Waiver Plus | Sum Assured PLUS Waiver of Future Premiums PLUS Monthly Income Benefit |
i. Classic Option
On a valid death claim for a premium paying or a fully paid-up policy, the death benefit shall be the highest of:
The partial withdrawals to be deducted from the death benefit shall be all partial withdrawals (except from the top-up fund value) made during the two-year period immediately preceding the death of the Life Assured
ii. Classic Plus Option
On a valid death claim for a premium paying or a fully paid-up policy, the death benefit shall be the higher of:
iii. Classic Waiver
This option is not available for Single Pay policies.
On a valid death claim for a premium paying or a fully paid-up policy, the death benefit shall be the higher of:
In addition, future premiums will be waived off by the Company and on each future premium due date(s), an amount equal to the modal premium shall be credited to the Policyholder’s Fund Value after deduction of applicable charges.
iv. Classic Waiver Plus
This option is not available for single pay policies.
On a valid death claim for a premium paying or a fully paid-up policy, the death benefit shall be the higher of:
In addition, future premiums will be waived off by the Company and on each future premium due date(s), an amount equal to the modal premium, shall be credited to the Policyholder’s Fund Value after deduction of applicable charges.
Monthly Income Benefit
In addition to the lumpsum and waiver of premium benefit stated above, this option also offers an income benefit.
An Income Benefit equal to a percentage of the Sum Assured (excluding any additional Sum Assured in respect of Top-ups) will also be paid on the policy anniversary date in each month following the date of death till the end of the Policy Term or the chosen Income Term, whichever comes earlier, subject to a minimum of 24 monthly payments.
Both Income percentage and Income Term will have to be chosen at inception.
At maturity, you will receive your Fund Value plus Return of Mortality Charges (if any).
Fund Value will be calculated by multiplying the balance units in your fund by the then prevailing unit price.
Your policy matures at the end of the policy term you have chosen.
Plan Option A: Growth Option
Return of Mortality Charges (ROMC): This will only be applicable where ‘Classic Waiver Plus’ is selected as the death benefit option.
High Death Benefit Multiple Booster: This will be applicable only where ‘Classic’ is selected as the death benefit option and provided the Death Benefit Multiple is greater than 30 times.
Plan Option B: Loyalty Option
Fund Value Enhancer: Loyalty additions shall be added to the fund in the form of allocation of extra units every 5 years starting from the 10th year policy anniversary.
Return of Policy Administration Charges: Sum total of Policy Administration charges (excluding applicable taxes) collected till 25th policy year will be added to the fund in the form of allocation of extra units at the end of 25th year.
Return of Mortality Charges (ROMC): This will only be applicable where ‘Classic Waiver Plus’ is selected as death benefit option. Under this loyalty addition, mortality charges (excluding extra mortality charges due to underwriting) deducted between a specified period will be returned at maturity.
High Death Benefit Multiple Booster: This will be applicable only where ‘Classic’ is selected as the death benefit option and provided the Death Benefit Multiple is greater than 30 times.
Plan Option C: Loyalty Plus
Fund Value Enhancer: Loyalty additions shall be added to the fund in the form of allocation of extra units every 5 years starting from the 10th year policy anniversary.
Return of Policy Administration Charges: Sum total of Policy Administration charges (excluding applicable taxes) collected till 10th policy year will be added to the fund in the form of allocation of extra units at the end of the 15th / 20th policy year.
Return of Mortality Charges (ROMC): Under this loyalty addition,40% of mortality charges (excluding extra mortality charges due to underwriting) deducted during specified periods will be added back to the fund.
HDFC Life Click 2 Invest Plus Plan gives you the option of 10 different funds to invest your money.
Each fund has its own Investment policy, based on asset allocation between equity, debt and money market instruments.
You can invest in a combination of funds by allocating your funds between different fund options.
Also, you can switch between funds using the fund switch option at any time.
| S.no | FUND OPTION | ASSET ALLOCATION | RISK | ||
| Money Market, cash & deposits | Govt Sec, Fixed Income, Bonds | Equity | |||
| 1 | Diversified Equity Fund | 0-40% | 0-40% | 60-100% | Very High |
| 2 | Blue Chip Fund | 0-20% | – | 80-100% | Very High |
| 3 | Opportunities Fund | 0-20% | – | 80-100% | Very High |
| 4 | Balanced Fund | 0-20% | 0-60% | 40-80% | Moderate to High |
| 5 | Bond Fund | 0-60% | 40-100% | – | Moderate |
| 6 | Discovery Fund | 0-10% | 0-10% | 90-100% | Very High |
| 7 | Equity Advantage Fund | 0-20% | 0-20% | 80-100% | Very High |
| 8 | Flexi cap Fund | 0-20% | 0-20% | 80-100% | Very High |
| 9 | India Consumption Advantage Fund | 0-20% | 0-20% | 80-100% | High |
| 10 | Top 500 Smart Value 50 Fund | 0-10% | 0-10% | 90-100% | Very High |
i. Premium Allocation Charge
NIL
ii. Fund Management Charge (FMC)
1.35% p.a. of the fund value, charged daily, for all funds. 0.50% p.a. of the fund value for Discontinued Policy Fund.
iii. Policy Administration Charge
| Plan option | Single Pay | Limited/Regular Pay |
| Growth | Nil | Nil |
| Loyalty | 0.03% per month of the Single Premium till the 25th Policy year | 0.25% per month of the Annualised Premium till the 25th Policy year |
| Loyalty Plus | 0.05% per month of the Single Premium till the 25th Policy year | 0.20% per month of the Annualised Premium till the 25th Policy year |
iv. Mortality Charge
This charge is the cost of life insurance cover.
It is exclusive of any expense loadings and is levied by cancellation of Units.
This charge, if any, shall be levied at the beginning of each Policy month from the Fund.
v. Discontinuance Charge
This is a charge levied on the Unit Fund for individual Unit-linked insurance Products where you opt for Surrender or on Discontinuance of the contract.
This charge depends on the year of discontinuance and your annualised premium for limited, regular and single premium policies.
There is no charge from the 5th policy year.
vi. Partial withdrawal charge
The maximum partial withdrawal charge shall be Rs.500/- per transaction.
There are 4 free partial withdrawals in each policy year.
vii. Switching charge
The charge per switch shall be levied at the time of executing the switch.
The maximum switching charge shall be Rs.500 per switch.
viii. Miscellaneous Charge
This is a charge levied for any alterations within the contract, such as increase in sum assured, premium redirection, change in HDFC Life Click 2 Invest Plus Plan Policy term, etc.
This charge shall be levied by cancellation of units.
The charge may be increased subject to a cap of Rs 500 as per IRDAI (Insurance Products) Regulations, 2024.
ix. Premium Redirection Charge
There are 4 free premium redirections in each policy year.
Subsequent premium redirections, if any, will attract a charge of Rs 250 per request or a reduced charge of Rs 25 per request if executed through the company’s web portal.
x. Inference from the charges: The HDFC Click 2 Invest Plus Plan carries significant charges for a market-linked product.
These charges reduce the amount of your premium that is actually invested, which can have a direct impact on the growth of your investment.
Over the long term, this may result in lower overall returns and a reduced maturity corpus.
Grace Period
This plan has a grace period of 15 days for monthly mode and 30 days for other modes.
Discontinuance
Discontinuance of the policy during lock-in period: The fund value after deducting the applicable discontinuance charges shall be credited to the discontinued policy fund, and the risk cover and rider cover, if any, shall cease.
In case of discontinuance after the first five policy years: the policy will be converted into a reduced paid-up policy with a paid-up sum assured.
Reduced paid-up Sum Assured = Original Sum Assured X (Total number of premiums paid till the date of discontinuance/ Original number of premiums payable as per applicable terms and conditions of the policy)
Revival
You can revive a discontinued policy within three consecutive years from the date of first unpaid premium.
In case you are not agreeable to any of the policy terms and conditions, you have the option of returning the policy to us stating the reasons thereof, within 30 days from the date of receipt of the policy.
If you surrender during the lock-in period, your Fund Value less applicable charges will be moved to the Discontinued Policy Fund, and the proceeds from the Discontinued Policy Fund will be paid out on the completion of the lock-in period.
If you surrender after the lock-in period, your Fund Value will be paid out to you.
Upon payment of this benefit, the HDFC Life Click 2 Invest Plus Plan policy terminates, and no further benefits are payable.
If your objective is to build long-term wealth through a market-linked product, it is important to evaluate whether the HDFC Life Click 2 Invest Plus Plan is capable of supporting that objective.
One useful measure is the Internal Rate of Return (IRR), which can be calculated using the benefit illustration provided in the policy brochure.
This gives a clearer picture of the actual returns generated on the premiums paid.
Consider a 35-year-old male who opts for a ₹10 lakh sum assured, pays an annual premium of ₹1,00,000 for 20 years, and chooses a 20-year policy term under the Growth Plan with the Classic Death Benefit option.
| Male | 35 years |
| Sum Assured | ₹ 10,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | 20 years |
| Annualised Premium | ₹ 1,00,000 |
The illustration assumes investment returns of 4% p.a. and 8% p.a.
These are only illustrative assumptions and are not guaranteed. The actual fund value will depend on market performance, charges, and other applicable factors.
| At 4% p.a. | At 8% p.a. | ||||
| Age | Year | Annualised premium / Maturity benefit | Death benefit | Annualised premium / Maturity benefit | Death benefit |
| 35 | 1 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 36 | 2 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 37 | 3 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 38 | 4 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 39 | 5 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 40 | 6 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 41 | 7 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 42 | 8 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 43 | 9 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 44 | 10 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 45 | 11 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 46 | 12 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 47 | 13 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 48 | 14 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 49 | 15 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 50 | 16 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 51 | 17 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 52 | 18 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 53 | 19 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 54 | 20 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 55 | 26,37,601 | 41,40,741 | |||
| IRR | 2.57% | 6.51% | |||
The IRR remains relatively low even under the higher return assumption.
This raises concerns about the HDFC Life Click 2 Invest Plus plan’s ability to generate sufficient wealth over the long term, particularly when compared with other investment avenues that may offer better return potential.
Moreover, inflation steadily increases the cost of future financial goals.
A low-yield investment can therefore result in inadequate wealth accumulation and may leave you with a shortfall when your goals become due.
For investors seeking long-term wealth creation, it is important to assess whether the returns from the HDFC Life Click 2 Invest Plus Plan are sufficient to outpace inflation and meet their financial objectives.
The HDFC Life Click 2 Invest Plus Plan is positioned as a long-term investment solution.
However, as seen in the earlier illustration, the returns remain relatively modest even over a 20-year investment horizon.
A more effective approach is to separate insurance from investment—use a term insurance plan for protection and choose a suitable investment avenue for wealth creation.
Let’s consider an alternative using the same annual outlay of ₹1,00,000:
A pure term insurance policy with a ₹10 lakh sum assured, a 20-year policy term, and a 20-year premium-paying term costs approximately ₹4,100 per year.
This leaves ₹95,900 per year available for investment.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 10,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | 20 years |
| Annualised Premium | ₹ 4,100 |
| Investment | ₹ 95,900 |
The investment avenue can then be selected based on your risk profile and financial goals.
A conservative investor may consider a debt-oriented option such as PPF, while an investor with a higher risk appetite and a long-term horizon may consider an equity mutual fund.
| 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 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 36 | 2 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 37 | 3 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 38 | 4 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 39 | 5 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 40 | 6 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 41 | 7 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 42 | 8 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 43 | 9 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 44 | 10 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 45 | 11 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 46 | 12 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 47 | 13 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 48 | 14 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 49 | 15 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 50 | 16 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 51 | 17 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 52 | 18 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 53 | 19 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 54 | 20 | -1,00,000 | 10,00,000 | -1,00,000 | 10,00,000 |
| 55 | 42,56,866 | 70,27,008 | |||
| IRR | 6.75% | 10.89% | |||
Option 1: PPF
Investing ₹95,900 annually in PPF for 20 years could result in a maturity corpus of approximately ₹42.56 lakh, with an IRR of 6.75%.
Interestingly, this is comparable to the fund value under the HDFC Life Click 2 Invest Plus illustration at the assumed 8% return.
Despite being a debt-oriented investment, PPF demonstrates a better return than the ULIP’s projected IRR in this illustration.
Option 2: Equity Mutual Fund
If the same ₹95,900 is invested annually in an equity mutual fund for 20 years, the corpus could grow to approximately ₹77.39 lakh.
After accounting for applicable capital gains tax, the post-tax corpus would be around ₹70.27 lakh, translating into a post-tax IRR of approximately 10.89%.
| Equity Mutual Fund Tax Calculation | |
| Maturity value after 20 years | 77,39,009 |
| Purchase price | 19,18,000 |
| Long-Term Capital Gains | 58,21,009 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 56,96,009 |
| Tax paid on LTCG | 7,12,001 |
| Maturity value after tax | 70,27,008 |
This approach offers the potential for higher long-term wealth creation through equity participation, along with greater flexibility and liquidity compared with a ULIP.
The comparison highlights an important principle: insurance and investment serve different purposes and are often better handled separately. Combining both within a ULIP such as the HDFC Life Click 2 Invest Plus Plan may compromise the potential for wealth creation as well as liquidity.
For long-term financial goals, separating insurance from investment allows you to choose the right level of protection and the most suitable investment avenue independently, potentially resulting in better overall outcomes.
The HDFC Life Click 2 Invest Plus offers three plan variants and four death benefit options.
The plan variant determines the applicable loyalty additions, while the death benefit option determines the level of death benefit payable under the policy.
The combination you select determines the overall benefits available.
Beyond these features, however, the plan essentially functions as a standard ULIP.
A closer analysis of the returns raises concerns about its suitability for long-term wealth creation.
Despite being a market-linked product, the plan’s projected returns can remain relatively low and may even compare unfavourably with certain traditional debt instruments.
The multiple charges associated with the plan reduce the amount available for investment and can significantly affect the overall returns.
Combining insurance and investment in a single product can also lead to compromises in both areas.
The insurance cover may not be sufficient to adequately protect your family’s financial future, while the investment component may not generate the returns required to achieve long-term financial goals and it also has a high agent commission..
A more effective approach is to separate insurance from investment.
A pure-term insurance policy can provide adequate life cover at a relatively low cost, while the remaining funds can be invested in a diversified portfolio aligned with your financial goals, investment horizon, and risk tolerance.
Before choosing an investment product, consider evaluating its costs, liquidity, risk, and potential returns in relation to your specific financial objectives.
Do Quora, Facebook, and Twitter have the final say when it comes to financial advice?
A qualified financial advisor can help you assess these factors and build a personalised financial plan suited to your long-term needs.
Listen to this article Quick Summary What Works What Doesn't Experienced fund management leadership with…
Listen to this article Quick Summary What Works What Doesn't Strong 3-month and 5-year-plus numbers,…
Listen to this article Quick Summary What Works What Doesn't Genuine micro-cap and small-cap mandate…
Listen to this article Quick Summary What Works What Doesn't A genuinely different investment process…
Listen to this article Quick Summary What Works What Doesn't One of the longest live…
Listen to this article Quick Summary What Works What Doesn't Genuinely distinctive mandate — mostly…