HDFC Life Click 2 Retire Plus II Plan
Can the HDFC Life Click 2 Retire Plus II Plan truly help you build the retirement corpus you need, or is it just another retirement plan with limited advantages?
Does the HDFC Life Click 2 Retire Plus II Plan offer the right balance between wealth creation and retirement security, or are there better alternatives available?
Is the HDFC Life Click 2 Retire Plus II Plan a smart way to prepare for retirement, or should you explore more flexible investment options?
This article examines the plan’s features, benefits, and limitations, while also exploring alternative investment options that may help you build your retirement corpus more efficiently.
What is the HDFC Life Click 2 Retire Plus II?
What are the features of the HDFC Life Click 2 Retire Plus II?
Who is eligible for the HDFC Life Click 2 Retire Plus II?
What are the benefits of the HDFC Life Click 2 Retire Plus II?
What are the investment strategies and fund options in the HDFC Life Click 2 Retire Plus II?
What are the charges of the HDFC Life Click 2 Retire Plus II?
Grace Period, Discontinuance and Revival of the HDFC Life Click 2 Retire Plus II
Free Look Period for the HDFC Life Click 2 Retire Plus II
Surrendering the HDFC Life Click 2 Retire Plus II
What are the advantages of the HDFC Life Click 2 Retire Plus II?
What are the disadvantages of the HDFC Life Click 2 Retire Plus II?
Research Methodology of HDFC Life Click 2 Retire Plus II
Benefit Illustration – IRR Analysis of HDFC Click 2 Retire Plus II
HDFC Life Click 2 Retire Plus II Vs. Other Investments
HDFC Life Click 2 Retire Plus II Vs. Pure-term + PPF/Equity Mutual Fund
Final Verdict on the HDFC Life Click 2 Retire Plus II
HDFC Life Click 2 Retire Plus II is a Unit Linked Non-Participating Individual Pension Savings Plan. It is designed to help you build a retirement corpus in a structured and flexible manner.
You can choose from multiple premium payment terms and policy structures depending on your retirement horizon, risk appetite, and investment preference.
| Criteria | Secure Option | Flexi Option (Growth & Loyalty) |
| Entry Age | 18 – 65 years | 18 – 65 years |
| Vesting Age | 45 – 75 years | 45 – 75 years/up to 99 years |
| Premium Payment Term (PPT) | Single Pay, Regular Pay, Limited Pay: 8 / 10 / 15 years | Single Pay, Regular Pay, Limited Pay: 5/8/10 /15/20 years |
| Policy Term | 10, 15 to 35 years | 10, 15 to 35 years / 99-age at entry |
| Premium / Payment Frequency | Regular & Limited Pay Options | Single Pay Options |
| Annual | 24000 | NA |
| Half Yearly | 12000 | NA |
| Quarterly | 6000 | NA |
| Monthly | 2000 | NA |
| Single Pay | NA | 50000 |
| Maximum Premium | No Limit | |
Secure
Your policy vests at the end of the HDFC Life Click 2 Retire Plus II Plan policy term, and your Maturity (Vesting) Benefit will be the higher of the following:
Assured Vesting Benefit can be calculated as: [101% +1% * (Policy Term minus Premium Paying Term)] * Total premiums paid till date
Flexi (Growth & Loyalty)
Your policy vests at the end of the HDFC Life Click 2 Retire Plus II Plan policy term, and your Maturity (Vesting) Benefit will be the higher of the following:
Utilisation of Vesting Benefit
On Vesting: On the date of vesting, the policyholder shall be allowed:
Without Waiver of Premium Option, on death during the policy term, the nominee will receive the higher of:
After payment of the death benefit, the HDFC Life Click 2 Retire Plus II Plan policy will terminate. The nominee can choose to:
With Waiver of Premium Option, on death of the policyholder:
Utilisation of Death Benefit
The nominee can choose to:
If the nominee opts for withdrawal or annuity purchase, the policy will terminate
This will only be applicable if the policyholder has opted for Plan Option Flexi-Loyalty
Return of Policy Administration Charges
Sum total of Policy Administration charges (excluding taxes) collected till 15th policy year will be added to the fund in the form of allocation of extra units at the end of the policy year
Return of Mortality Charges
This will only be applicable if the policyholder has opted for Waiver of Premium Benefit under Plan option B – Flexi with sub plan option – Loyalty, provided all due premiums under the policy have been paid.
Total Mortality charges (excluding underwriting extra mortality charge and taxes, if any) deducted throughout the policy term will be returned at the vesting date.
| S no | Fund Name | Money Market Instruments, Cash & Deposits | Government Securities, Fixed Income Instruments & Bonds | Equity | Risk Profile |
| 1 | Pension Equity Plus Fund | 0%-20% | 0%-20% | 80%-100% | Very High |
| 2 | Pension Income Fund | 0%-20% | 80%-100% | _ | Moderate |
| 3 | Pension Conservative Fund | 0%-60% | 40%-100% | _ | Moderate |
| Option B: The following funds will be available in the Flexi plan option | |||||
| 4 | Individual Prime Equity Pension Fund | 0-10% | 0-10% | 90-100% | High |
| 5 | Flexi Cap Pension Fund | 0%-20% | 0%-20% | 80%-100% | Very High |
| 6 | HDFC Life Dynamic Advantage Pension Fund | 0-50% | 0-50% | 50-100% | Medium |
| 7 | Top 300 Alpha 50 Pension Fund | 0-10% | 0-10% | 90-100% | High |
| 8 | India Consumption Advantage Pension Fund | 0%-20% | 0%-20% | 80%-100% | High |
| 9 | India Sector Leaders Opportunities Pension Fund | 0%-20% | 0%-20% | 80%-100% | High |
| 10 | Top 500 Smart Value 50 Pension Fund. | 0%-20% | 0%-20% | 80%-100% | Very High |
i. Fund management Charges
The Fund Management Charge is 1.35 % p.a. of fund value. This charge is charged daily and is a percentage of the fund value
ii. Policy Administration Charges
Secure: Nil
Flexi:
| Plan option | Single Pay | Regular Pay/Limited Pay |
| Flexi: Growth | Nil | Nil |
| Flexi: Loyalty | 0.05% of the single premium | 0.3% per month of the Annualised Premium |
iii. Investment Guarantee Charge
| S no | Fund Name | Investment Guarantee Charge |
| 1 | Pension Equity Plus Fund | 0.50% |
| 2 | Pension Income Fund | 0.50% |
| 3 | Pension Conservative Fund | 0.10% |
iv. Statutory Charges
Statutory Taxes and Levies as applicable would be charged. This shall include Taxes and levies, as applicable, on or in respect of this Policy
v. Miscellaneous Charge(s)
A Miscellaneous Charge of Rs 250 shall be levied for any Policy alterations within the contract
vi. Premium Allocation charges
Nil
vii. Mortality charge
Applicable only when Waiver of Premium option is opted.
This charge is the cost of life insurance cover. It is exclusive of any expense loadings and is levied upon cancellation of units
Mortality charge is calculated as the Sum at Risk multiplied by the appropriate mortality charge rate. This charge will be deducted monthly upon cancellation of units.
viii. Policy Discontinuance Charges
Policy Discontinuance Charges are levied one time on the date of Policy Discontinuation. It depends on the year of discontinuance and the amount of premium.
Inference from these charges: The charges associated with this plan are relatively high for a market-linked product. These deductions reduce the actual amount invested, thereby lowering the growth potential of your corpus. Over the long term, this diminishes the final value of your investment, which ultimately leads to a lower pension amount post-retirement.
Grace Period
The grace period is 15 days for monthly premium payment mode and 30 days for other premium payment modes.
Discontinuance
Discontinuance of Policy during the 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. At the end of the Lock-in Period, the proceeds of the Discontinued Policy Fund Pension shall be paid to the Policyholder and the policy shall terminate.
Discontinuance of Policy after the lock-in-Period: the Policy shall be converted into a reduced paid-up policy with the paid-up sum assured. Till the end of the Revival Period or before the end of Policy Term, the policy shall continue to be in reduced paid-up status. At the end of the revival period, the proceeds of the Policy fund shall be paid to the Policyholder and the Policy shall terminate.
Revival
You have the option to revive a discontinued policy within three consecutive years from the date of the first unpaid premium.
In case you are not agreeable to any of the terms and conditions stated in the Policy, you have the option to return the Policy within 30 days from the date of receipt of the Policy, whether received electronically or otherwise.
In case the policy is surrendered during the lock-in period, the fund value net of Policy Discontinuance Charges shall be credited to the Discontinued Policy Fund Pension.
The fund value credited to the Discontinued Policy Fund Pension will continue to be invested in Discontinued Policy Fund Pension till the end of the lock-in period or death of the life assured, whichever is earlier.
In case the policy is surrendered after completion of the lock-in period, the policy stands terminated, and the fund value as on the date of surrender must be utilised by the policyholder in the same manner as vesting benefit.
The HDFC Life Click 2 Retire Plus II Plan is designed to help investors build a retirement corpus through regular investments, with the objective of generating income during their post-retirement years.
However, assessing the potential returns and understanding how the accumulated corpus can be utilised is important before investing. Let us examine the returns based on the illustrations provided in the policy brochure.
Consider a 40-year-old male who invests ₹1 lakh annually for 10 years under a 20-year policy term and selects the Flexi: Growth option.
At the end of the HDFC Life Click 2 Retire Plus II Plan policy term, the vesting benefit is payable and must be used to purchase an annuity.
| Male | 40 years |
| Sum Assured | ₹ 10,50,000 |
| Policy Term | 20 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 1,00,000 |
The brochure illustrates two assumed investment scenarios—4% p.a. and 8% p.a. These are not guaranteed returns and are provided only for illustration.
The actual fund value will depend on the investment performance of the underlying funds.
| At 4% p.a. | At 8% p.a. | ||||
| Age | Year | Annualised premium / Maturity benefit | Death benefit | Annualised premium / Maturity benefit | Death benefit |
| 40 | 1 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 41 | 2 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 42 | 3 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 43 | 4 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 44 | 5 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 45 | 6 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 46 | 7 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 47 | 8 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 48 | 9 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 49 | 10 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 50 | 11 | 0 | 10,50,000 | 0 | 10,50,000 |
| 51 | 12 | 0 | 10,50,000 | 0 | 10,50,000 |
| 52 | 13 | 0 | 10,50,000 | 0 | 10,50,000 |
| 53 | 14 | 0 | 10,50,000 | 0 | 10,50,000 |
| 54 | 15 | 0 | 10,50,000 | 0 | 10,50,000 |
| 55 | 16 | 0 | 10,50,000 | 0 | 10,50,000 |
| 56 | 17 | 0 | 10,50,000 | 0 | 10,50,000 |
| 57 | 18 | 0 | 10,50,000 | 0 | 10,50,000 |
| 58 | 19 | 0 | 10,50,000 | 0 | 10,50,000 |
| 59 | 20 | 0 | 10,50,000 | 0 | 10,50,000 |
| 60 | 14,93,907 | 27,18,822 | |||
| IRR | 2.61% | 6.55% | |||
At an assumed growth rate of 4% p.a., the corpus at vesting is ₹14.93 lakh, translating into an IRR of 2.61% as per the HDFC Life Click 2 Retire Plus II Plan maturity calculator.
At 8% p.a., the corpus grows to ₹27.18 lakh, resulting in an IRR of 6.55% as per the HDFC Life Click 2 Retire Plus II Plan maturity calculator.
The brochure also illustrates annual annuity incomes of ₹1.29 lakh under the 4% scenario and ₹2.37 lakh under the 8% scenario.
However, these figures are only indicative.
The actual retirement income will depend on two uncertain factors at the time of vesting: the corpus accumulated and the prevailing annuity rates.
Another important limitation is that the maturity corpus cannot be used entirely at the investor’s discretion.
Only up to 60% of the vesting benefit can be commuted as a lump sum, while the balance must be used to purchase an annuity.
Therefore, the illustrated IRRs should not be viewed as the actual returns available for unrestricted use.
Since a portion of the corpus must be converted into an annuity and the annuity rates applicable at that time are not guaranteed, the eventual retirement income remains uncertain.
Overall, the plan offers a structured approach to retirement accumulation, but the combination of modest illustrated returns, restricted access to the maturity corpus, and uncertainty over future annuity rates makes it less attractive for investors who want greater control over their retirement savings or are seeking potentially higher returns.
A major drawback of the HDFC Life Click 2 Retire Plus II Plan is the restriction on how the accumulated corpus can be utilised.
At vesting, you are required to use a portion of the corpus to purchase an annuity, which limits your flexibility and control over your retirement savings.
A more flexible approach is to separate insurance from investment. This allows you to secure the required life cover while investing the remaining amount in an instrument that aligns with your risk profile and retirement goals.
Consider the same scenario of a 40-year-old individual investing ₹1 lakh annually for 10 years. Instead of investing the entire amount in the pension plan, the individual could purchase a pure-term insurance policy with a sum assured of ₹10.50 lakh, equivalent to the death benefit offered under the pension plan.
A 20-year term with a 10-year premium payment period would cost approximately ₹11,300 per year.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 10,50,000 |
| Policy Term | 20 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 11,300 |
| Investment | ₹ 88,700 |
This leaves ₹88,700 annually for investment.
The amount can then be invested in debt or equity-based instruments depending on the investor’s risk tolerance and financial goals.
| Term Insurance + PPF | Term insurance + Equity Mutual Fund | ||||
| Age | Year | Term Insurance premium + PPF | Death benefit | Term Insurance premium + Equity Mutual Fund | Death benefit |
| 40 | 1 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 41 | 2 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 42 | 3 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 43 | 4 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 44 | 5 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 45 | 6 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 46 | 7 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 47 | 8 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 48 | 9 | -1,00,000 | 10,50,000 | -1,00,000 | 10,50,000 |
| 49 | 10 | -97,500 | 10,50,000 | -1,00,000 | 10,50,000 |
| 50 | 11 | -500 | 10,50,000 | 0 | 10,50,000 |
| 51 | 12 | -500 | 10,50,000 | 0 | 10,50,000 |
| 52 | 13 | -500 | 10,50,000 | 0 | 10,50,000 |
| 53 | 14 | -500 | 10,50,000 | 0 | 10,50,000 |
| 54 | 15 | -500 | 10,50,000 | 0 | 10,50,000 |
| 55 | 16 | 0 | 10,50,000 | 0 | 10,50,000 |
| 56 | 17 | 0 | 10,50,000 | 0 | 10,50,000 |
| 57 | 18 | 0 | 10,50,000 | 0 | 10,50,000 |
| 58 | 19 | 0 | 10,50,000 | 0 | 10,50,000 |
| 59 | 20 | 0 | 10,50,000 | 0 | 10,50,000 |
| 60 | 26,17,553 | 48,64,289 | |||
| IRR | 6.30% | 10.46% | |||
If the ₹88,700 annual investment is directed towards PPF, with minimal contributions of ₹500 in the final years to meet the applicable lock-in requirements, the corpus could grow to approximately ₹26.17 lakh over 20 years, translating into an IRR of 6.30%.
More importantly, the entire maturity corpus is tax-free and can be accessed without the restrictions associated with mandatory annuity purchase.
For investors willing to take market risk, investing the same ₹88,700 annually in equity mutual funds could potentially build a corpus of approximately ₹54.14 lakh over 20 years.
After accounting for capital gains tax, the post-tax corpus could be around ₹48.64 lakh, resulting in a post-tax IRR of approximately 10.46%.
| Equity Mutual Fund Tax Calculation | |
| Maturity value after 20 years | 54,14,616 |
| Purchase price | 8,87,000 |
| Long-Term Capital Gains | 45,27,616 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 44,02,616 |
| Tax paid on LTCG | 5,50,327 |
| Maturity value after tax | 48,64,289 |
The key advantage of this alternative strategy is flexibility. The retirement corpus can be allocated across different investment options based on changing financial needs, risk tolerance, and retirement objectives.
Unlike the HDFC Life Click 2 Retire Plus II Plan, there is no mandatory requirement to convert the accumulated savings into an annuity.
In retirement planning, flexibility and control over your accumulated wealth are crucial.
By keeping insurance and investments separate, you can secure the required life cover while retaining greater control over your retirement corpus and choosing how best to deploy it when the need arises.
The HDFC Life Click 2 Retire Plus II offers three plan options aimed at helping investors build a retirement corpus through market-linked investments.
The Secure option provides a minimum guaranteed maturity benefit, offering some protection when market performance is unfavourable.
In contrast, the Flexi-Growth and Flexi-Loyalty options are market-linked and expose the investor to market fluctuations.
However, irrespective of the option selected, a major drawback remains at maturity: the accumulated corpus cannot be used entirely at the investor’s discretion.
At vesting, the maturity benefit, either fully or partly as permitted under the policy, must be utilised to purchase an annuity at the rates prevailing at that time.
Although positioned as a retirement product, the plan primarily focuses on accumulation and does not provide certainty over the post-retirement income and it also has a high agent commission.
Combined with market risk, charges, and restrictions on accessing the corpus, this makes the plan less attractive for investors seeking flexibility and predictable retirement income.
A better approach is to start investing early and consistently, allowing compounding to build your retirement corpus over time. Separating insurance and investments can also provide greater control over your money.
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