IndiaFirst Life Long Guaranteed Income Plan: Good or Bad? A Detailed Review

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Can the IndiaFirst Life Long Guaranteed Income Plan be a dependable solution for your future financial needs?

Can the IndiaFirst Life Long Guaranteed Income Plan truly secure your financial future, or does it fall short of expectations?

Is the IndiaFirst Life Long Guaranteed Income Plan the key to stress-free retirement, or does it lack the flexibility investors need?

In this review, we will examine its features, benefits, and drawbacks. With detailed calculations, this analysis aims to help you make an informed decision.

What is the IndiaFirst Life Long Guaranteed Income Plan?

IndiaFirst Life Long Guaranteed Income Plan is a Non-Linked, Non-Participating, Limited Premium, Individual Savings Life Insurance Plan. It supports you and your family in all stages of life by providing life cover throughout the term of your policy as well as an assured income benefit.

What are the features of the IndiaFirst Life Long Guaranteed Income Plan?

Pay for a limited period and enjoy long-term financial benefits.
Receive guaranteed income to help you achieve your financial goals.
Enhance your lifestyle with the Definite Income Option.
Secure a guaranteed income for a fixed term of 20 or 30 years.
opt for the Whole of Life Income Option and receive guaranteed payouts until the age of 99.
Get 100% or 115% of total premiums paid at the end of the income period, based on the annualized premium.
Maintain full life cover even if you miss one premium payment, provided you have paid the first two years’ premiums in full.

Who is eligible for the IndiaFirst Life Long Guaranteed Income Plan?

Criteria	Minimum	Maximum
Age at entry	8 years for Definite Income Option 30 years for Whole of Life Income Option	50 years for Definite Income Option 60 years for Whole of Life Income Option
Age at maturity	18 years for Definite Income Option 40 years for Whole of Life Income Option	65 years for Definite Income Option 75 years for Whole of Life Income Option
Premium paying term & Policy term	Premium paying term	Policy term
	5/6/7 years	10 years
	7/8/10 years	12 years
	8/10/12 years	15 years
Income Benefit Period	20/30 years for Definite Income Option Till 99 years of age for Whole of Life Income Option
Premium	Premium Yearly- Rs. 48,000 Half-yearly- Rs. 24,571 Quarterly- Rs. 12,432 Monthly- Rs. 4,176	As per Max Sum assured
Sum assured	₹ 4,80,000	₹ 10,00,000
Premium payment Frequency	Yearly/ Half-Yearly/ Quarterly/ Monthly

What are the benefits of the IndiaFirst Life Long Guaranteed Income Plan?

1. Death benefit

In the unfortunate event of the life assured’s demise during the term of the policy or when the policy is fully paid up, Death Benefit is paid out to the nominee either as lumpsum or as monthly income over the next 5 years as opted by the policyholder/nominee(s) at any time during the policy period or on the death of Life Assured.

Death Benefit is higher than,

Sum Assured on Death (Death Benefit Multiple * Annualized premium) or
105% of total premiums

2. Income benefit (Survival benefit) and

Maturity benefit

Definite Income Option

Under this option, X% percentage of the annualised premium is paid as income, starting from the end of the Policy Term for a definite income benefit period of 20 or 30 years & Y% of return of premium at the end of the income benefit period upon payment of all due premiums & life assured surviving the Policy Term

Whole of Life Income Option

Under this option, X% of annualised premium is paid as income starting from the end of the policy term up to age 99 years along with Y% of return of premium at the end of the income benefit period upon payment of all due premiums & life assured surviving the Policy Term

Grace Period, Lapse and Paid-up and Revival of IndiaFirst Life Long Guaranteed Income Plan

Grace Period

This IndiaFirst Life Long Guaranteed Income Plan policy has a grace period of 30 days for yearly, half-yearly and quarterly frequencies and 15 days for monthly frequencies from the premium due date.

Lapse

The risk cover will cease, and no further benefits will be payable in case of a lapsed policy. The IndiaFirst Life Long Guaranteed Income Plan policy will lapse if less than one full year’s premiums have been paid.

Paid-up

In case of non-payment of premium before the expiry of the grace period, the IndiaFirst Life Long Guaranteed Income Plan policy will acquire paid-up value provided at least one (1) full-year premium has been paid. The benefits will be reduced proportionately.

Revival

The revival period is 5 years from the date of the first unpaid premium.

Free Look Period of IndiaFirst Life Long Guaranteed Income Plan

In case you do not agree with any IndiaFirst Life Long Guaranteed Income Plan policy terms and conditions, you have the option of returning the policy to the insurer within 30 days from the date of receipt of the policy.

Surrendering IndiaFirst Life Long Guaranteed Income Plan

The policy will acquire surrender value after the first full year’s premiums have been paid. At the time of surrender higher of Guaranteed Surrender Value (GSV) or Special Surrender Value (SSV) will be payable.

What are the advantages of the IndiaFirst Life Long Guaranteed Income Plan?

If at least two full annual premiums are paid, the full death benefit remains active for one year from the date of the first unpaid premium (FUP).
Policyholders can avail a loan of up to 90% of the surrender value.
The death benefit can be received either as a lump sum or as regular income over five years.
Coverage can be enhanced by choosing from four optional riders.
Tax benefits are available on premiums paid and benefits received, as per prevailing tax laws.

What are the disadvantages of the IndiaFirst Life Long Guaranteed Income Plan?

Receiving yearly income benefits reduces the power of compounding on your investment.
The sum assured may not be adequate to meet your family’s essential financial needs.
Returns are relatively lower compared to alternative investment options.
Regular income payments do not adjust for inflation, diminishing purchasing power over time.
Life coverage does not continue during the income payout period.
The policy term and premium payment period offer limited flexibility.

Research Methodology of IndiaFirst Life Long Guaranteed Income Plan

The IndiaFirst Life Long Guaranteed Income Plan offers regular income after the premium-paying period. Before committing to this investment, it is essential to evaluate its potential returns.

Using figures from the policy brochure, we will calculate the Internal Rate of Return (IRR) for this plan and compare it with alternative investment options.

Benefit Illustration – IRR Analysis of IndiaFirst Life Long Guaranteed Income Plan

Consider a 40-year-old male choosing this plan with a 10-year policy term and a 7-year premium-paying period, contributing an annual premium of ₹5,00,001. The sum assured under the policy is ₹58,45,012.

Male	40 years
Sum Assured	₹ 58,45,012
Policy Term	10 years
Premium Paying Term	7 years
Annualised Premium	₹ 5,00,001

After completing the premium payments, he starts receiving an annual survival benefit of ₹2,70,001. At maturity, he receives a final payout of ₹40,25,008.

Based on this cash flow, the IRR comes to 4.93% as per the IndiaFirst Life Long Guaranteed Income Plan maturity calculator, which is lower than the returns offered by bank fixed deposits.

Age	Year	Annualised premium / Maturity benefit	Death benefit
40	1	-5,00,001	₹ 58,45,012
41	2	-5,00,001	₹ 58,45,012
42	3	-5,00,001	₹ 58,45,012
43	4	-5,00,001	₹ 58,45,012
44	5	-5,00,001	₹ 58,45,012
45	6	-5,00,001	₹ 58,45,012
46	7	-5,00,001	₹ 58,45,012
47	8	0	₹ 58,45,012
48	9	0	₹ 58,45,012
49	10	0	₹ 58,45,012
50	11	0	0
51	12	2,70,001	0
52	13	2,70,001	0
53	14	2,70,001	0
54	15	2,70,001	0
55	16	2,70,001	0
56	17	2,70,001	0
57	18	2,70,001	0
58	19	2,70,001	0
59	20	2,70,001	0
60	21	2,70,001	0
61	22	2,70,001	0
62	23	2,70,001	0
63	24	2,70,001	0
64	25	2,70,001	0
65	26	2,70,001	0
66	27	2,70,001	0
67	28	2,70,001	0
68	29	2,70,001	0
69	30	2,70,001	0
70		42,95,009	0

	IRR	4.93%

A fixed regular income that does not adjust for inflation may not be beneficial for most investors. Although the plan provides income benefits for 20 years, the returns may not be compelling enough to justify the investment.

Given its limited life coverage and modest returns, this plan may not be an ideal choice for long-term investors.

IndiaFirst Life Long Guaranteed Income Plan Vs. Other Investments

While the IndiaFirst Life Long Guaranteed Income Plan integrates life insurance with investment, separating these components can yield better financial outcomes.

By reallocating the same premium more efficiently, it is possible to generate equivalent or superior cash flows. Let’s analyse this approach using the previous example.

IndiaFirst Life Long Guaranteed Income Plan Vs. Pure-Term + ELSS

A pure-term life insurance policy with a ₹75 lakh sum assured (comparable to the IndiaFirst Life Long Guaranteed Income Plan) costs ₹29,100 annually for a 10-year policy term with a 5-year premium payment period.

This leaves ₹4,70,901 per year, which can be invested based on individual risk preferences.

Pure Term Life Insurance Policy
Sum Assured	₹ 75,00,000
Policy Term	10 years
Premium Paying Term	5 years
Annualised Premium	₹ 29,100
Investment	₹ 4,70,901

Since the premium payment term in the IndiaFirst plan is 7 years, while the term policy requires payments for only 5 years, the saved premium can be invested in the first 5 years. In the last 2 years, the full ₹5 lakh annual amount becomes available for investment.

		Term insurance + ELSS
Age	Year	Term Insurance premium + ELSS	Death benefit
40	1	-5,00,001	₹ 75,00,000
41	2	-5,00,001	₹ 75,00,000
42	3	-5,00,001	₹ 75,00,000
43	4	-5,00,001	₹ 75,00,000
44	5	-5,00,001	₹ 75,00,000
45	6	-5,00,001	₹ 75,00,000
46	7	-5,00,001	₹ 75,00,000
47	8	0	₹ 75,00,000
48	9	0	₹ 75,00,000
49	10	0	₹ 75,00,000
50	11	0	0
51	12	2,70,001	0
52	13	2,70,001	0
53	14	2,70,001	0
54	15	2,70,001	0
55	16	2,70,001	0
56	17	2,70,001	0
57	18	2,70,001	0
58	19	2,70,001	0
59	20	2,70,001	0
60	21	2,70,001	0
61	22	2,70,001	0
62	23	2,70,001	0
63	24	2,70,001	0
64	25	2,70,001	0
65	26	2,70,001	0
66	27	2,70,001	0
67	28	2,70,001	0
68	29	2,70,001	0
69	30	2,70,001	0
70		1,65,25,376	0

	IRR	8.06%

Low-risk investors might opt for debt instruments like the Public Provident Fund (PPF), while high-risk investors could prefer equity-based options such as Equity-Linked Savings Schemes (ELSS). For this analysis, we consider the ELSS route.

At the end of 10 years, the accumulated ELSS corpus is transferred to an instrument offering a 7% annual return, which serves as the source for annual withdrawals and a final lump-sum redemption.

The pre-tax maturity value of the ELSS investment reaches ₹75.72 lakhs, and after capital gains tax, the post-tax value stands at ₹70.61 lakhs.

This amount is then invested at a 7% return, allowing for annual withdrawals that match the payouts of the IndiaFirst plan, followed by full redemption at maturity. This approach results in an Internal Rate of Return (IRR) of 8.06%.

ELSS Tax Calculation
Maturity value after 10 years	75,72,747
Purchase price	33,54,507
Long-Term Capital Gains	42,18,240
Exemption limit	1,25,000
Taxable LTCG	40,93,240
Tax paid on LTCG	5,11,655
Maturity value after tax	70,61,092

If annual withdrawals are avoided, the returns could be even higher, providing greater flexibility in managing cash flow based on actual needs.

Given its lack of flexibility and relatively low returns, the IndiaFirst Life Long Guaranteed Income Plan falls short when compared to this alternative approach.

Final Verdict on IndiaFirst Life Long Guaranteed Income Plan

The IndiaFirst Life Long Guaranteed Income Plan accumulates your premiums to provide annual payouts in the future. By investing for a limited period, you receive payouts for either 20/30 years or the rest of your life.

However, this income benefit does not adjust for inflation and may not be sufficient to cover significant expenses. Additionally, the sum assured might fall short of meeting your family’s long-term financial needs.

Annual withdrawals reduce the plan’s overall returns by disrupting the compounding effect of investments. For generating regular income, separating life insurance from investments is a more effective strategy.

With limited life coverage and relatively low returns, the IndiaFirst Life Long Guaranteed Income Plan may not be the best choice for those seeking steady income and it also has a high agent commission.

Traditional life insurance products combine insurance and investment, but a better approach is to secure your family’s financial future with a pure-term life insurance policy.

For investments, choosing options aligned with your risk tolerance, financial goals, and time horizon can yield better results.

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

Instead of relying on insurance plans for regular income, building a well-diversified investment portfolio will provide greater financial flexibility.

Consulting a Certified Financial Planner can help you create a personalized strategy, ensuring you select the right financial products based on your unique needs and circumstances.

IndiaFirst Life Long Guaranteed Income Plan: Good or Bad? A Detailed Review

Table of Contents:

What is the IndiaFirst Life Long Guaranteed Income Plan?

What are the features of the IndiaFirst Life Long Guaranteed Income Plan?

Who is eligible for the IndiaFirst Life Long Guaranteed Income Plan?