ICICI Pru Sukh Samruddhi Plan: Good or Bad? An Insightful Review

Will the ICICI Pru Sukh Samruddhi Plan give you the confidence to keep pace with all your goals?

Will investing in the ICICI Pru Suk Samruddhi Plan help you achieve all your milestones across all stages of life?

Taking care of your family’s needs and requirements will be your priority. So they can be financially secure even in the face of shifting circumstances and unprecedented times.

Should this investment product be a part of your investment portfolio?

In this article, let us review the ICICI Pru Suk Samruddhi Plan’s Advantages (Pros) and Disadvantages (Cons) along with the potential return of the plan.

This Research Analysis will guide you in choosing the right investment product and make those informed investment decisions.

Table of Contents

1.) What is the ICICI Pru Sukh Samruddhi Plan?
2.) What are the Features of the ICICI Pru Sukh Samruddhi Plan?
3.) Who is Eligible to invest in the ICICI Pru Sukh Samruddhi Plan?
4.) ICICI Pru Sukh Samruddhi Plan Benefits in Detail
5.) ICICI Pru Sukh Samruddhi Plan Grace Period, Discontinuance, and Revival
6.) ICICI Pru Sukh Samruddhi Plan Free Look period
7.) Surrendering ICICI Pru Sukh Samruddhi Plan
8.) Advantages of ICICI Pru Sukh Samruddhi Plan
9.) Disadvantages of ICICI Pru Sukh Samruddhi Plan
10.) ICICI Pru Sukh Samruddhi Plan Research Methodology

• ICICI Pru Sukh Samruddhi Plan Benefit Illustration – IRR Analysis

11.) ICICI Pru Sukh Samruddhi Plan VS Other Investment

• ICICI Pru Sukh Samruddhi Plan VS Pure Term + PPF / ELSS
• ICICI Pru Sukh Samruddhi Plan VS ICICI Pru Assured Savings Plan
• ICICI Pru Sukh Samruddhi Plan VS ICICI Pru Gold Plan

11.) ICCI Pru Sukh Samruddhi Plan VS Other Investment Options – Review Conclusion
12.) Final Verdict on ICICI Pru Sukh Samruddhi Plan

1.) What is the ICICI Pru Sukh Samruddhi Plan?

ICICI Pru Sukh Samruddhi is a Participating Savings-Oriented Life Insurance Plan.

It helps to grow your savings through participation in bonuses and provides you with the flexibility in availing the benefits either as a one-time lump sum or as regular income.

2.) What are the Features of the ICICI Pru Sukh Samruddhi Plan?

• Life cover acts as a financial protection for your loved ones.
• Flexible premium payment terms and policy terms to plan for your future goals.
• The choice to avail benefits as either Income benefit or Lump sum benefit.
• Under Save the Date’ option, you can receive income on any date of your choice.
• Option to accumulate income and withdraw it later as per your convenience with the ‘Savings wallet’ option.

3.) Who is Eligible to invest in the ICICI Pru Sukh Samruddhi Plan?

4.) ICICI Pru Sukh Samruddhi Plan Benefits in detail

i.) ICICI Pru Sukh Samruddhi Plan Option 1: Income

Guaranteed income (GI)

After successful completion of the premium paying term, the life insured will be entitled to receive the Guaranteed Income throughout the policy term. It can either be given at the end of each month or year.

You will receive the Guaranteed Income for the selected Income Term chosen by you at inception.

Lump sum on maturity

If the policyholder survives till the end of the policy term and no due premiums are left, then in addition to the Maturity Benefit last GI pay-out will also be paid.

Maturity Benefit = Accrued reversionary bonus, if declared + Terminal bonus if declared

Death Benefit

Death Benefits will be higher of:

• Sum Assured on Death + Accrued Reversionary Bonus, if declared + Interim Reversionary Bonus, if declared + Terminal Bonus, if declared; or
• 105% of total premiums paid up to the date of death

Where Sum Assured on Death is:

• For Ages 0 to 50: Higher of 10.5 X Annualized Premium or Premium Paying Term X Annualized Premium
• For Ages 51 to 60: Higher of 10 X Annualized Premium or Premium Paying Term X Annualized Premium

ii.) ICICI Pru Sukh Samruddhi Plan Option 2: Lumpsum

Maturity benefit

If the policyholder survives till the end of the policy term, he will be eligible to receive the Maturity Benefit.

Maturity Benefit= Sum assured on maturity + accrued reversionary bonus if declared +terminal bonus if declared

Here the Maturity benefit depends on your Premium, Premium Paying Term, Policy Term, Age, and Gender. The Sum Assured on Maturity is expressed as a multiple of the Annualised Premium.

Death Benefit

Death Benefits will be higher of:

• Sum Assured on Death + Accrued Reversionary Bonus, if declared + Interim Reversionary Bonus, if declared + Terminal Bonus if declared; or
• 105% of total premiums paid up to the date of death

Where Sum Assured on Death is:

For Limited Pay:

• For Ages 0 to 50: Higher of 10.5 X Annualized Premium or Premium Paying Term X Annualized Premium
• For Ages 51 to 60: Higher of 10 X Annualized Premium or Premium Paying Term X Annualized Premium

For Regular Pay:

• For Ages 0 to 50: 10.5 X Annualized Premium
• For Ages 51 to 60: 10 X Annualized Premium

5.) ICICI Pru Sukh Samruddhi Plan Grace Period, Discontinuance, and Revival

Grace Period

A grace period of 15 days will be given for payment of the due installment premium monthly frequency, and 30 days will be given for payment of the due installment premium for any other frequency commencing from the premium due date.

Discontinuance

If you stop paying premiums in the first two years, the policy will lapse on the expiry of the grace period. If you do not revive the lapsed policy by the end of the revival period, it will terminate and no benefits will be payable.

If you stop paying premiums after you paid premiums for the first two full years, your policy acquires a surrender value and is said to have become a “paid-up” policy.

A paid-up policy is one where you are entitled to get benefits, but these benefits will be lower than actual benefits since you would have paid less than the total premiums supposed to be paid.

Revival

You can revive your policy benefits for their full value within five years from the due date of the first unpaid premium by paying all due premiums together with interest before the termination date of the policy.

6.) ICICI Pru Sukh Samruddhi Plan Free Look period

If you are not satisfied with the terms and conditions of the policy, you can return the policy within 15 days from the date you received it, if your policy is not purchased through Distance marketing

Or 30 days from the date you received it, in the case of electronic policies or if your policy is purchased through Distance marketing.

For any more clarification, you can refer to the ICCI Pru Sukh Samruddhi Plan Policy Brochure

7.) Surrendering ICICI Pru Sukh Samruddhi Plan

After payment of premiums for at least the first two full years, if you are not able to continue your policy, a surrender value will be payable. On surrendering the policy, you will receive the higher of the following:

• Guaranteed Surrender Value (GSV) which includes guaranteed surrender value of Accrued Reversionary Bonus, if declared

• Special Surrender Value (SSV)

8.) Advantages of ICICI Pru Sukh Samruddhi Plan

• You can choose to receive the Guaranteed Income (GI) on any special date like a birthday or anniversary.

• You have the option to accumulate Guaranteed Incomes (GIs) and let them grow, instead of taking them as payment during the policy term.

• You can take a policy loan after your policy acquires a surrender value. Up to 80% of the surrender value can be availed as a loan.

9.) Disadvantages of ICICI Pru Sukh Samruddhi Plan

• ‘Save the date’ and ‘Savings Wallet’ features can be availed only with the ‘Income’ plan option.

• The income benefit remains constant without being adjusted to inflation.

• As it is a participatory policy, all the benefits are non-guaranteed.

10.) ICICI Pru Sukh Samruddhi Plan Research Methodology

ICICI Pru Sukh Samruddhi offers two plan options. The bonus declaration plays a major role as all the benefits that come under both regular income and lumpsum are dependent on this rate.

So, let us work out the potential return of the plan to figure out the efficiency. A quote was taken from the ICICI website to calculate the Internal Rate Return of the plan.

ICICI Pru Sukh Samruddhi Plan Benefit Illustration – IRR Analysis

A 35-year-old buys ICICI Pru Sukh Samruddhi for a sum assured of ₹ 10.5 Lakhs. The premium paying term and the policy term are 15 years. The annualized premium is ₹ 1 Lakh. He chooses plan option 2 Lumpsum.

Male	35 years
Sum Assured	10,50,000
Policy Term	15 years
Premium Paying Term	15 years
Annualised Premium	1,00,000

At the end of 15 years, he receives the maturity benefit. The illustration assumes two future investment returns – 4% p.a. and 8% p.a.

The returns depicted in this illustration are not guaranteed and do not indicate any upper limit or lower limit of this plan.

The returns of the plan depend on various factors which include future investment performances as well.

		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	10,50,000	-1,00,000	10,50,000
36	2	-1,00,000	10,50,001	-1,00,000	10,50,001
37	3	-1,00,000	10,50,002	-1,00,000	10,50,002
38	4	-1,00,000	10,50,003	-1,00,000	10,50,003
39	5	-1,00,000	10,50,004	-1,00,000	10,50,004
40	6	-1,00,000	10,50,005	-1,00,000	10,50,005
41	7	-1,00,000	10,50,006	-1,00,000	10,50,006
42	8	-1,00,000	10,50,007	-1,00,000	10,50,007
43	9	-1,00,000	10,50,008	-1,00,000	10,50,008
44	10	-1,00,000	10,50,009	-1,00,000	10,50,009
45	11	-1,00,000	10,50,010	-1,00,000	10,50,010
46	12	-1,00,000	10,50,011	-1,00,000	10,50,011
47	13	-1,00,000	10,50,012	-1,00,000	10,50,012
48	14	-1,00,000	10,50,013	-1,00,000	10,50,013
49	15	-1,00,000	10,50,014	-1,00,000	10,50,014
50		17,97,467	10,50,015	23,79,441	10,50,015
	IRR	2.23%		5.58%

The final maturity value under the 4% scenario is ₹ 17.97 Lakhs. Under the gross return of 4%, the net return is 2.23%. If you keep the money idle in your Savings bank account, you can yield better interest and you have the liquidity benefit.

The final maturity value under the 8% scenario is ₹ 23.79 Lakhs. Under the gross return of 8%, the net return is 5.58%. If you invest in a Bank fixed deposit, it can yield better returns.

To combat inflation in the long run, your investment should yield more than the inflation rate. The IRR under both scenarios is less than the inflation rate, making it uneconomical.

11.) ICICI Pru Sukh Samruddhi Plan VS Other Investment

The potential returns calculation reveals that ICICI Pru Sukh Samruddhi is unfavorable for long-term investment. Getting better returns from the investment is the main agenda under any investment plan.

In order to meet this, let us look for some alternate options where we can channelise the same premium paid ICICI Pru Sukh Samruddhi.

To make the comparison process easier, let us assume the same metric as seen in the above illustration.

i.)ICICI Pru Sukh Samruddhi Plan VS Pure Term + PPF / ELSS

Pure Term Life Insurance Policy
Sum Assured	10,50,000
Policy Term	15 years
Premium Paying Term	15 years
Annualised Premium	5,300
Investment	94,700

The premium amount in the earlier illustration was ₹ 1Lakh. Out of this amount, we need to set aside a Pure Term Life Insurance policy premium.

A pure term life insurance policy for a sum assured of ₹ 10.5Lakhs would cost ₹ 5,300. So, every year you can invest ₹ 94,700

PPF – The account matures after 15 years. The proceeds are fully tax-free

ELSS – The units can be redeemed after 15 years. The ELSS returns are subject to Capital gains tax. So, we need to set aside the tax liability. Tax calculation is given below.

		Term Insurance + PPF		Term insurance + ELSS
Age	Year	Term Insurance premium + PPF	Death benefit	Term Insurance premium + ELSS	Death benefit
35	1	-1,00,000	10,50,000	-1,00,000	10,50,000
36	2	-1,00,000	10,50,001	-1,00,000	10,50,001
37	3	-1,00,000	10,50,002	-1,00,000	10,50,002
38	4	-1,00,000	10,50,003	-1,00,000	10,50,003
39	5	-1,00,000	10,50,004	-1,00,000	10,50,004
40	6	-1,00,000	10,50,005	-1,00,000	10,50,005
41	7	-1,00,000	10,50,006	-1,00,000	10,50,006
42	8	-1,00,000	10,50,007	-1,00,000	10,50,007
43	9	-1,00,000	10,50,008	-1,00,000	10,50,008
44	10	-1,00,000	10,50,009	-1,00,000	10,50,009
45	11	-1,00,000	10,50,010	-1,00,000	10,50,010
46	12	-1,00,000	10,50,011	-1,00,000	10,50,011
47	13	-1,00,000	10,50,012	-1,00,000	10,50,012
48	14	-1,00,000	10,50,013	-1,00,000	10,50,013
49	15	-1,00,000	10,50,014	-1,00,000	10,50,014
50		25,68,396	10,50,015	37,10,682	10,50,015
	IRR	6.47%		10.68%

The final maturity value under the PPF account is 25.68 lakhs. The IRR for Term insurance premium with PPF combo gives you a return of 6.47%.

The final maturity value under the ELSS fund is 3.10 Lakhs (post-tax value). The IRR for Term insurance premium with ELSS combo gives you a return of 10.68% (post-tax return).

ELSS Tax Calculation
Maturity value after 15 years	39,54,036
Purchase price	14,20,500
Long-Term Capital Gains	25,33,536
Exemption limit	1,00,000
Taxable LTCG	24,33,536
Tax paid on LTCG	2,43,354
Maturity value after tax	37,10,682

Under both scenarios, you have the advantage of liquidity and returns. These two aspects are missing in ICICI Pru Sukh Samruddhi.

ii) ICICI Pru Sukh Samruddhi Plan VS ICICI Pru Assured Savings Plan

Will ICCI Pru Assured Savings help you enhance your savings? Let’s start by analysing some of the key features of this plan.

• Flexibility to choose Premium Paying Term and Policy Term
• Life Coverage is provided for the entire policy term.
• You will be entitled to receive the guaranteed lump sum at the end of the policy term.

For further insights into this ICCI Pru Assured Savings Plan. We suggest you read our article on: ICICI Pru Assured Savings Plan: Insightful Review – Good or Bad?

iii) ICICI Pru Sukh Samruddhi Plan VS ICICI Pru Gold Plan

As the name suggests, will this plan add more value to your Investment Portfolio? To get a better idea let’s delve into some of the key features.

• Life Cover up to 99 years of age.
• Flexibility to choose income option as per your convenience
• Under select variants, Guaranteed boosters after every 5 years.

To know more about the Benefits, Advantages, and Suitability of this ICICI Pru Gold Plan. You can refer to our article on: ICICI Pru Gold Plan Review – Good or Bad Investment Option?

12.) ICCI Pru Sukh Samruddhi Plan VS Other Investment Options – Review Conclusion

Since the returns that you generated from ICCI Sukh Samruddhi Plan are not adjusted to inflation it cannot be considered as Long Term Investment Vehicle.

Whereas the other investments seem to offer better risk-adjusted and more importantly inflation-beating returns which is more than useful to your financial goals.

13.) Final Verdict on ICICI Pru Sukh Samruddhi

Some goals in life that require a regular flow of income and for some goals, you need to accumulate a corpus like marriage, retirement kitty, etc.

ICICI Pru Sukh Samruddhi is designed to receive either regular income or a lumpsum amount. You can choose the policy term and premium paying term based on your preference.

While analysing the plan, it clearly shows that the life cover will not be adequate to meet the family’s future needs. The IRR analysis shows that it is a low-yielding product with a High Agent Commission. So, both in terms of insurance and investment aspects, it is not favourable for an investor.

The comparison part demonstrates how to channelise the same premium amount effectively. A Pure-Term Life Insurance Policy for Life Cover and Diversified Investment Portfolio is essential to achieve all your goals.

At times you might caught up in the buzz happening on Social Media Platforms like Quora, Facebook, Twitter, etc., and make those wrong investment choices. To avoid this you need to have a clear understanding of your Investment Objective and your Financial Goals.

Investing separately for life goals envisages a bright future. For any assistance, you can consult a finance professional who will guide you in drafting a financial plan based on your personal preferences.