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Marriage is a new phase of life where you share the rest of your life with your loved one. You need to secure your life in order to protect your partner’s life in case of eventualities.
Max Life company offers an insurance plan called Perfect Partner Super Plan. As the name suggests, will it be a perfect plan to protect your partner?
This article will help you understand the features and benefits of the plan with a thorough analysis of the Advantages(pros) and disadvantages(cons) of the Max Life Perfect Partner Super Plan. At the end of this review, you can definitely figure out whether this Max Life Perfect Partner Super plan is Good or Bad for your investment goals.
Let’s get started!
Table of Contents
1.)An Overview of Max Life Perfect Partner Super Plan
2.)Features of Max Life Perfect Partner Super Plan – Analysis
3.)Eligibility Criteria of Max Life Perfect Partner Super Plan
4.)Review of Benefits in detail under Max Life Perfect Partner Super Plan
5.)A grace period, Lapsed and paid-up policy, Revival of Max Life Perfect Partner Super Plan
6.)A free-Look period of Max Life Perfect Partner Super Plan
7.)Surrendering Max Life Perfect Partner Super Plan
8.)Advantages of Max Life Perfect Partner Super Plan – Analysis
9.)Disadvantages of Max Life Perfect Partner Super Plan – Analysis
10.)Research methodology of Max Life Perfect Partner Super Plan
- Benefit illustration IRR(Internal Rate of Return i.e Interest Rate) Analysis of Max Life Perfect Partner Super Plan
11.)Max Life Perfect Partner Super Plan vs Other Investment Options – Review
- Max Life Perfect Partner Super Plan Vs. Pure Term Life Insurance + PPF / ELSS
- Max Life Perfect Partner Super Plan vs. Max Life Smart Wealth Plan
- Max Life Perfect Partner Super Plan vs. Max Life Smart Wealth Income Plan
12.)Max Life Perfect Partner Super Plan vs. Other Investment Plans – Review Conclusion
13.)Final Verdict on Max Life Perfect Partner Super Plan – Good or Bad?
1. An Overview of Max Life Perfect Partner Super Plan
It is a Non-Linked Participating Individual Life Insurance Savings Plan. It offers life cover till the age of 75, thus taking care of your partner’s financial needs. It offers 212.5% of the guaranteed sum assured on maturity through bonuses.
You can find the Max Life Perfect Partner Super Plan brochure here for complete policy details.
2. Features of Max Life Perfect Partner Super Plan – Analysis
- Flexibility to choose your premium payment terms – 7, 10, 15 or 20 years.
- Life insurance coverage till age 75 years and Maturity benefits at the age of 75 years.
- Money-back feature in Max Life Perfect Partner Super Plan offers you 7.5% of the Guaranteed Maturity Sum Assured per annum for 15 years to take care of your needs from age 61 years to 75 years.
- Flexibility to choose your bonus option as per your need
3. Eligibility Criteria of Max Life Perfect Partner Super Plan
| Policy Term | 75 years less Age at the entry of Life Insured |
| Premium Payment Term (PPT) | 7 years, 10 years, 15 years, or 20 years |
| Minimum Age at Entry | 91 days |
| Maximum Age at Entry | 55 / 50 / 45 years |
| Maturity Age | 75 years |
| Premium Modes | Annual, Semi-annual, Quarterly, Monthly |
| Minimum Premium | PPT – 7 Years: 20,000 p.a.PPT – 10 /15 Years: 8,500 p.a. |
| Maximum Premium | As per the maximum sum assured and age |
| Sum Assured Limits | Minimum: 20,000/50,000 and No maximum no limits |
4. Review of Benefits in detail under Max Life Perfect Partner Super Plan
Survival Benefit – Analysis
Guaranteed Survival Benefits is equal to 7.5% of Guaranteed Maturity Sum Assured payable from age 61 to 75 (for 15 years).
Maturity Benefit – Analysis
On maturity, that is, policy anniversary coinciding with or immediately following Life Insured’s 75th birthday, the following benefit will be paid:
- Guaranteed Maturity Sum Assured, plus
- Accrued Paid-up Additions (if any), plus
- Terminal Bonus (if any)
Death Benefit – Analysis
On death during the term of the Max Life Perfect Partner Super policy, the following benefits will be paid:
- Guaranteed Death Benefit, plus
- Accrued Paid-up Additions (if any), plus
- Terminal Bonus (if any)
Guaranteed Death Benefit is defined as higher of:
- 11 times the Annualised Max Life Perfect Partner Super Policy premium plus underwriting extra Premiums, if any),
- 105% of total premiums paid as of the date of death of the life insured,
- Guaranteed Maturity Sum Assured chosen by the Policyholder at Max Life Perfect Partner Super policy inception.
5. A Grace period, Lapsed and paid-up policy, Revival of Max Life Perfect Partner Super Plan
Grace Period:
A grace period of thirty days from the premium due date (15 days in case of Monthly mode) for payment of each premium will be allowed.
Lapse:
If the Max Life Perfect Partner Super Policy Premium is not received within the Grace Period and the policy has not acquired a surrender value, the Policy shall lapse and all the benefits secured under the policy shall also lapse.
Reduced Paid-Up Policy:
After a policy has acquired surrender value, the policy shall not lapse. In case of premium discontinuance, the policy will by default become Reduced Paid Up (RPU).
Revival:
A reduced paid-up policy or lapsed policy can be revived within a revival period of five years from the due date of the first unpaid premium.
6. A free-Look period of Max Life Perfect Partner Super Plan
If you disagree with any of the terms and conditions, you have the option to return the policy within a period of 15 days (30 days if the policy is sourced through Distance Marketing modes) from the date of receipt of the policy document.
7. Surrendering Max Life Perfect Partner Super Plan
The policy acquires a Surrender Value After payment of the first two full-year premiums. The surrender value will be higher than the Guaranteed Surrender Value (GSV) or Special Surrender Value (SSV).
8. Advantages of Max Life Perfect Partner Super Plan – Analysis
- 50% of the Guaranteed sum is paid if the policyholder is suffering from a Terminal Illness.
- Three rider options are available for additional protection.
- Flexibility to withdraw the accumulated bonus is available in the Max Life Perfect Partner Super Plan.
9. Disadvantages of Max Life Perfect Partner Super Plan – Analysis
- A loan facility is not available.
- The Sum Assured is too low.
- The policy matures at the age of 75 years. You won’t get a life cover beyond that age.
- Bonuses are non-guaranteed.
- The plan is beneficial only if the policyholder survives till the age of 75 years.
10. Research methodology of Max Life Perfect Partner Super Plan
The next part of our analysis is interest calculation. An investment needs to be assessed with the alignment of risk and return. For that, let us calculate the return for the Max Life Partner Super Plan. Later, we shall compare this return with other investment returns. We shall use the figures given in the company’s sales brochure.
Benefit illustration IRR(Internal Rate of Return i.e Interest Rate) Analysis of Max Life Perfect Partner Super Plan
A 40-year-old male buys Max Life Perfect Partner Super Plan for a Sum assured of ₹ 5 Lakhs. The Policy term is 35 years and The premium paying term is 20 years. The annualized premium is ₹ 50,915. He is entitled to receive survival benefits from the age of 61 to 75 years. Along with that maturity benefit is payable at the age of 75 years.
| Male | 40 Years |
| Policy Term | 35 Years |
| Premium Paying Term | 15 years |
| Guaranteed Maturity Sum Assured | 5,00,000 |
| Annualised premium | 50,915 |
He receives ₹ 37,500 as a survival benefit for 15 years. After that along with the bonus, the maturity benefit is receivable. Bonuses are non-guaranteed and are declared at the sole discretion of the Company. The following scenarios are depicted at an assumed rate of returns – 4% and 8% and these are not the upper or lower limits of what one can expect from this policy, as it is dependent on a number of factors including future investment performance.
| Age | Year | At 4% p.a. | At 8% p.a. | ||
| Annualised premium / Maturity benefit | Death benefit | Annualised premium / Maturity benefit | Death benefit | ||
| 40 | 1 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 41 | 2 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 42 | 3 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 43 | 4 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 44 | 5 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 45 | 6 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 46 | 7 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 47 | 8 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 48 | 9 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 49 | 10 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 50 | 11 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 51 | 12 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 52 | 13 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 53 | 14 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 54 | 15 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 55 | 16 | 0 | 5,00,000 | 0 | 5,00,000 |
| 56 | 17 | 0 | 5,00,000 | 0 | 5,00,000 |
| 57 | 18 | 0 | 5,00,000 | 0 | 5,00,000 |
| 58 | 19 | 0 | 5,00,000 | 0 | 5,00,000 |
| 59 | 20 | 0 | 5,00,000 | 0 | 5,00,000 |
| 60 | 21 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 61 | 22 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 62 | 23 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 63 | 24 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 64 | 25 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 65 | 26 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 66 | 27 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 67 | 28 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 68 | 29 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 69 | 30 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 70 | 31 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 71 | 32 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 72 | 33 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 73 | 34 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 74 | 35 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 75 | 36 | 9,19,385 | 5,00,000 | 29,05,677 | 5,00,000 |
| IRR | 2.70% | 5.80% | |||
In the above illustration. The IRR(Internal Rate of Return i.e. Interest Rate) is calculated at 5.80%.
The final maturity amount varies due to the bonus. The IRR under the 4% scenario is 2.70%. A savings bank account yields better returns than this investment. The IRR under the 8% scenario is 5.80%. A bank fixed deposit offers more liquidity and returns than a Max Life Perfect Partner Super Plan.
Any long-term investment should offer inflation-beating returns. Max Life Perfect Partner Super Plan is a long-term investment offering regular cash flow and maturity benefits to the Max Life Perfect Partner Super policyholder. But when we compute return, the returns are not beneficial in the long run.
11. Max Life Perfect Partner Super Plan vs Other Investment Options – Review
While analysing the Max Life Perfect Partner Super Plan, we figured out that the returns were not convincing. Instead of investing in Max Life Perfect Partner Super Plan, we shall look for other better investment opportunities. We need to fulfill both the insurance and investment components.
i) Max Life Perfect Partner Super Plan Vs. Pure Term Life Insurance + PPF / ELSS
A pure term policy for ₹ 5Lakhs cover would cost ₹ 9,500. We assume the same sum assured as in the previous illustration. In general, taking an adequate life cover is very important. The policy term is 35 years and the premium paying term is 10 years. In the initial 10 years, ₹ 41,415 is available for investment. In the next 5 years, ₹ 50,915 is available for investment.
| Pure Term Life Insurance Policy | |
| Policy Term | 35 Years |
| Premium Paying Term | 10 years |
| Guaranteed Maturity Sum Assured | 5,00,000 |
| Annualised premium | 9,500 |
| Investment | 41,415 |
For investment, you can choose any instrument that aligns with your personal risk. Risk-averse investors can choose debt instruments like PPF and those who are ready to take risks can invest in Equity instruments like ELSS Mutual funds.
The accumulated corpus under PPF / ELSS could be invested in a 7% return instrument. So, that you can withdraw annually. After withdrawing annually for 15 years, you can exit the investment. This arrangement is to match the survival benefit and maturity benefit of the Max Life Perfect Partner Super Plan.
| Age | Year | Term Insurance + PPF | Term insurance + ELSS | ||
| Term Insurance premium + PPF | Death benefit | Term Insurance premium + ELSS | Death benefit | ||
| 40 | 1 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 41 | 2 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 42 | 3 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 43 | 4 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 44 | 5 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 45 | 6 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 46 | 7 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 47 | 8 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 48 | 9 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 49 | 10 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 50 | 11 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 51 | 12 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 52 | 13 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 53 | 14 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 54 | 15 | -50,915 | 5,00,000 | -50,915 | 5,00,000 |
| 55 | 16 | 0 | 5,00,000 | 0 | 5,00,000 |
| 56 | 17 | 0 | 5,00,000 | 0 | 5,00,000 |
| 57 | 18 | 0 | 5,00,000 | 0 | 5,00,000 |
| 58 | 19 | 0 | 5,00,000 | 0 | 5,00,000 |
| 59 | 20 | 0 | 5,00,000 | 0 | 5,00,000 |
| 60 | 21 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 61 | 22 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 62 | 23 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 63 | 24 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 64 | 25 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 65 | 26 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 66 | 27 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 67 | 28 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 68 | 29 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 69 | 30 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 70 | 31 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 71 | 32 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 72 | 33 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 73 | 34 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 74 | 35 | 37,500 | 5,00,000 | 37,500 | 5,00,000 |
| 75 | 36 | 35,86,536 | 5,00,000 | 70,66,833 | 5,00,000 |
| IRR | 6.44% | 8.62% | |||
In the above illustration, the IRR is calculated at 6.44% for Term Insurance premium + PPF and the IRR of Term Insurance premium + ELSS is calculated at 8.62%.
The final maturity value under PPF investment is 16.65 Lakhs. This amount is invested in a 7% return instrument. After withdrawing ₹ 37,500 annually for 15 years, the final amount of ₹ 35.86 Lakhs is withdrawn fully. The IRR for this cash flow is 6.44%.
ELSS funds are subject to capital gains tax at the time of exit. The pre-tax value is ₹ 31.66 and the post-tax value is 29.26 Lakhs. This amount is invested in a 7% return instrument. After withdrawing ₹ 37,500 annually for 15 years, the final amount of ₹ 70.66 Lakhs is withdrawn fully. The IRR for this cash flow is 8.62%.
| ELSS Tax Calculation | |
| Maturity value after 20 years | 31,66,587 |
| Less | |
| Purchase price | 6,68,725 |
| Long-term capital gains | 24,97,862 |
| Exemption limit | 1,00,000 |
| Taxable LTCG | 23,97,862 |
| Tax paid on LTCG | 2,39,786 |
| Maturity value after tax | 29,26,801 |
This IRR analysis clearly shows the importance of investing in your life goals. If you invest via an insurance cum savings plan, you will end up losing both time and money.
ii) Max Life Perfect Partner Super Plan vs. Max Life Smart Wealth Plan
There are four plan options in the Max Life Smart Wealth Plan. Investors can choose as per their needs.
i) Lumpsum plan.
ii) Short-Term Income Plan.
iii) Long-Term Income Plan.
iv) Whole Life Income Policy.
You can read the complete review of the Max Life Smart Wealth Plan here.
iii) Max Life Perfect Partner Super Plan vs. Max Life Smart Wealth Income Plan
- Throughout the Policy Term, you are free to start earning your Survival Benefits whenever you choose.
- You have the option to receive rewards in the future on a monthly or yearly basis.
- The protection will be increased by riders.
You can find the complete review of the Max Life Smart Wealth Income Plan here.
12. Max Life Perfect Partner Super Plan vs. Other Investment Plans – Review Conclusion
We have compared and analyzed all other alternative investment options for Max Life Perfect Partner Super Plan and have concluded that Term Insurance + PPF or ELSS is a better option compared to all other investment options.
13. Final Verdict on Max Life Perfect Partner Super Plan – Good or Bad?
Annuity plans in general provide a regular stream of income throughout your life. Similarly, money-back policies provide lump-sum payments at regular intervals. Max Life Perfect Partner Super Plan neither serves as a money-back policy nor serves as an annuity plan. The reason behind this is here you don’t receive any lump sum payment nor do you receive lifelong annuity. You receive only survival benefits till the age of 75 years.
Moreover, inflation erodes the survival benefit down the lane. Considering all the above points reveals that investing in Max Life Perfect Partner Super Plan is not beneficial to investors under any circumstance. But, why do insurance agents still push you into these plans? For their high agent commission!
Any investment combined with the insurance plan will not serve the purpose. Alternatively, always invest separately for life goals. For retirement, you can build your retirement corpus which serves you during your post-retirement period.
Are you someone who is searching for the right investment product on social media sites like Quora, Facebook, Twitter, etc? Consult a financial advisor, before selecting any investment product.
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