PNB MetLife Aajeevan Suraksha Plan
Can the PNB MetLife Aajeevan Suraksha Plan ensure financial stability for generations to come?
Can the PNB MetLife Aajeevan Suraksha Plan truly safeguard your financial future?
Can the PNB MetLife Aajeevan Suraksha Plan provide financial security for your loved ones?
In this review, we’ll explore the plan’s features, advantages, disadvantages, and returns analysis. We’ll also compare it with other investment options to help you make an informed decision.
What is the PNB MetLife Aajeevan Suraksha Plan?
What are the features of the PNB MetLife Aajeevan Suraksha Plan?
Who is eligible for the PNB MetLife Aajeevan Suraksha Plan?
What are the benefits of the PNB MetLife Aajeevan Suraksha Plan?
1. Death or Terminal illness benefit
Grace period, Reduced Paid-up and Revival of PNB MetLife Aajeevan Suraksha Plan
Free Look Period for the PNB MetLife Aajeevan Suraksha Plan
Surrendering the PNB MetLife Aajeevan Suraksha Plan
What are the advantages of the PNB MetLife Aajeevan Suraksha Plan?
What are the disadvantages of the PNB MetLife Aajeevan Suraksha Plan?
Research Methodology of PNB MetLife Aajeevan Suraksha Plan
Benefit Illustration – IRR Analysis of PNB MetLife Aajeevan Suraksha Plan
PNB MetLife Aajeevan Suraksha Plan Vs. Other investments
PNB MetLife Aajeevan Suraksha Plan Vs. Pure-term + PPF / ELSS
Final Verdict on PNB MetLife Aajeevan Suraksha Plan
PNB MetLife Aajeevan Suraksha Plan is an Individual, Non-linked, Non-participating, Pure Risk Premium, Life Insurance Plan. PNB MetLife Aajeevan Suraksha Plan offers flexible premium payment options, lifetime coverage up to age 99, and the ability to include your spouse. It also provides a return of premiums if you survive until the policy term ends.
| Fixed Cover Option | Whole Life Cover Option | |
| Entry Age | Minimum 18 Years Maximum 65 years | |
| Maximum Maturity Age | 80 years | 99 years |
| Sum Assured | Minimum ₹25,00,000 Maximum No limit | |
| Minimum premium | Regular pay – ₹ 3975 Other than Regular pay – ₹ 5000 | |
| Maximum premium | Based on the Basic Sum Assured, Entry Age, Policy Term, Premium payment term, Smoker Status, Benefit Option, Cover Option and Return of Premium Option chosen | |
| Premium paying term | Single pay: Single premium payment at the inception of the Policy Limited pay: 5 to 15 Regular pay (Regular Pay is only available with the Fixed Term option) | |
| Minimum policy term | Single pay, Regular pay: 10 Limited pay: Premium payment term plus 5 | |
| Maximum Policy term | Without Return of Premium: 40 years With Return of Premium: 30 years | Without Return of Premium: 99 minus Age at entry |
| Premium payment option | Yearly, Half-yearly and Monthly | |
OPTION 1 – LUMP SUM
At inception, you have to choose the lump sum payable immediately on the first occurrence of Death or diagnosis of Terminal Illness of the life assured during the PNB MetLife Aajeevan Suraksha Plan policy term. This lump sum amount is equal to the Sum Assured on the Death.
OPTION 2 – LIFE PARTNER
Both the PNB MetLife Aajeevan Suraksha Plan Policyholder (the first life) and his/her spouse (the second life) are covered. At inception, you have to choose the lump sum payable immediately on the first occurrence of Death or diagnosis of Terminal Illness of the first life during the policy term.
The cover to the Second life shall be less than or equal to 50% of the lump sum amount chosen for the first life, subject to a minimum of Rs.25 lakhs and a maximum of Rs. 1 Crore. The lump sum amount payable in respect of each life is equal to the Sum Assured on Death in respect of each life.
OPTION 3 – FIXED INCOME
At inception, you have to choose the Monthly Income amount. On the first occurrence of Death or diagnosis of Terminal Illness, Sum Assured on Death shall be payable.
Sum Assured on Death is equal to a lump sum amount (equal to 100 times of Monthly Income chosen at the time of inception) payable immediately plus fixed Monthly Income payable over 10 years (120 months) in instalments.
OPTION 4 – INCREASING INCOME
At inception, you have to choose the Monthly Income amount. On the first occurrence of Death or diagnosis of Terminal Illness, Sum Assured on Death shall be payable.
Sum Assured on Death is equal to a lump sum amount (equal to 100 times of Monthly Income chosen at the time of inception) payable immediately plus increasing Monthly Income payable over 10 years (120 months) in instalments increasing at 10% simple per annum.
Maturity benefits will be zero if the ‘Without Return of Premiums’ option is chosen under the PNB MetLife Aajeevan Suraksha Plan Policy.
Maturity benefit is payable only if the ‘With Return of Premiums’ option is chosen. The maturity benefit is equal to the Guaranteed sum assured on maturity.
For Option 1 – Lump Sum, Option 3 – Fixed Income, and Option 4 – Increasing Income, Guaranteed Sum Assured on Maturity is 100% of total premiums paid.
For Option 2 – Life partner, the Guaranteed Sum Assured on Maturity varies based on the survival of the partners.
The grace period for payment of the premium is 15 days, where the PNB MetLife Aajeevan Suraksha Plan policyholder pays the premium on a monthly basis and 30 days in all other cases.
If all due premiums for the first two consecutive years are not paid, the PNB MetLife Aajeevan Suraksha Plan policy shall lapse at the end of the grace period and the risk cover and rider benefits, if any, will cease immediately
If a policy has acquired a surrender value/Unexpired Risk Premium Value and future due instalment premiums are not paid, the PNB MetLife Aajeevan Suraksha Plan policy will continue as a paid-up policy with reduced benefits. However, the policyholder shall have the option to surrender the policy.
You can revive your lapsed / Paid-up policy and the riders for its full coverage within five consecutive years from the due date of the first unpaid premium but before PNB MetLife Aajeevan Suraksha Plan policy maturity.
If you have any objections to the terms and conditions of your PNB MetLife Aajeevan Suraksha Plan Policy, you may cancel the Policy within 15 days (30 days in case of distance marketing channel or electronic policies) from the date of receiving your Policy.
For Single Pay: The PNB MetLife Aajeevan Suraksha Plan policy will acquire a guaranteed surrender value or an unexpired risk premium value, as applicable, immediately after the payment of Single premium.
For Limited Pay: If all due premiums have been paid for at least two consecutive policy years, the PNB MetLife Aajeevan Suraksha Plan policy shall acquire a guaranteed surrender value or an unexpired risk premium value, as applicable.
For Regular Pay: If the ‘Without Return of Premiums’ option is chosen – Being a pure protection regular paying policy, there is no surrender value.
For Regular Pay: If the ‘With Return of Premiums’ option is chosen – If all due premiums have been paid for at least two consecutive years, the PNB MetLife Aajeevan Suraksha Plan policy shall acquire a guaranteed surrender value.
The PNB MetLife Aajeevan Suraksha Plan provides life coverage for a fixed term or up to 99 years of age. If the policyholder survives and has selected the ‘Return of Premium’ option, they receive a lump sum as a maturity benefit.
However, there is no maturity benefit under the ‘Without Return of Premium’ option. The premiums paid are simply returned at maturity without any value additions, resulting in a zero return on investment. Let’s illustrate this with an example from the policy brochure.
A 30-year-old male chooses the PNB MetLife Aajeevan Suraksha Plan with a sum assured of ₹1 crore. He selects a policy term of 30 years with a 15-year premium payment term and opts for the ‘With Return of Premium’ benefit. The annual premium is ₹28,600.
| Male | 30 years |
| Sum Assured | ₹ 1,00,00,000 |
| Policy Term | 30 years |
| Premium Paying Term | 15 years |
| Annualised Premium | ₹ 28,600 |
At the end of the policy term, he receives a maturity benefit of ₹4.29 lakhs as per the PNB MetLife Aajeevan Suraksha Plan maturity calculator. However, the internal rate of return (IRR) for this cash flow is zero.
| Age | Year | Annualised premium / Maturity benefit | Death benefit |
| 30 | 1 | -28,600 | 1,00,00,000 |
| 31 | 2 | -28,600 | 1,00,00,000 |
| 32 | 3 | -28,600 | 1,00,00,000 |
| 33 | 4 | -28,600 | 1,00,00,000 |
| 34 | 5 | -28,600 | 1,00,00,000 |
| 35 | 6 | -28,600 | 1,00,00,000 |
| 36 | 7 | -28,600 | 1,00,00,000 |
| 37 | 8 | -28,600 | 1,00,00,000 |
| 38 | 9 | -28,600 | 1,00,00,000 |
| 39 | 10 | -28,600 | 1,00,00,000 |
| 40 | 11 | -28,600 | 1,00,00,000 |
| 41 | 12 | -28,600 | 1,00,00,000 |
| 42 | 13 | -28,600 | 1,00,00,000 |
| 43 | 14 | -28,600 | 1,00,00,000 |
| 44 | 15 | -28,600 | 1,00,00,000 |
| 45 | 16 | 0 | 1,00,00,000 |
| 46 | 17 | 0 | 1,00,00,000 |
| 47 | 18 | 0 | 1,00,00,000 |
| 48 | 19 | 0 | 1,00,00,000 |
| 49 | 20 | 0 | 1,00,00,000 |
| 50 | 21 | 0 | 1,00,00,000 |
| 51 | 22 | 0 | 1,00,00,000 |
| 52 | 23 | 0 | 1,00,00,000 |
| 53 | 24 | 0 | 1,00,00,000 |
| 54 | 25 | 0 | 1,00,00,000 |
| 55 | 26 | 0 | 1,00,00,000 |
| 56 | 27 | 0 | 1,00,00,000 |
| 57 | 28 | 0 | 1,00,00,000 |
| 58 | 29 | 0 | 1,00,00,000 |
| 59 | 30 | 0 | 1,00,00,000 |
| 60 | 4,29,000 | ||
| IRR | 0.00% |
While the ‘Return of Premium’ feature is promoted as an advantage, in reality, it offers no real benefit to the policyholder. In fact, policies with a return of premium typically have higher premiums compared to those without this feature. We’ll explore this further in the next section.
Opting for a pure-term life insurance policy, without profit or return of premium options, is the most effective way to protect your family from uncertainties. These policies offer substantial life coverage at an affordable premium.
For achieving life goals, it’s advisable to invest separately based on your risk tolerance, enabling you to build the necessary corpus over time.
Let’s consider the same scenario with a life cover of ₹1 crore. The premium for a pure-term policy is ₹21,300, with a policy term of 30 years and a premium payment term of 15 years. By choosing a pure-term policy, you save ₹7,300 annually, which can be invested separately.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 1,00,00,000 |
| Policy Term | 30 years |
| Premium Paying Term | 15 years |
| Annualised Premium | ₹ 21,300 |
| Investment | ₹ 7,300 |
High-risk investors might lean towards equity investments, while those with lower risk tolerance may prefer debt instruments. We’ve analyzed both options: a PPF account for debt and an ELSS fund for equity.
| Term Insurance + PPF | Term insurance + ELSS | ||||
| Age | Year | Term Insurance premium + PPF | Death benefit | Term Insurance premium + ELSS | Death benefit |
| 30 | 1 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 31 | 2 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 32 | 3 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 33 | 4 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 34 | 5 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 35 | 6 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 36 | 7 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 37 | 8 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 38 | 9 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 39 | 10 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 40 | 11 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 41 | 12 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 42 | 13 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 43 | 14 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 44 | 15 | -28,600 | 1,00,00,000 | -28,600 | 1,00,00,000 |
| 45 | 16 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 46 | 17 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 47 | 18 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 48 | 19 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 49 | 20 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 50 | 21 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 51 | 22 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 52 | 23 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 53 | 24 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 54 | 25 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 55 | 26 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 56 | 27 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 57 | 28 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 58 | 29 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 59 | 30 | 0 | 1,00,00,000 | 0 | 1,00,00,000 |
| 60 | 5,53,958 | 14,89,107 | |||
| IRR | 1.11% | 5.44% | |||
In the PPF account, the final value would be ₹5.53 lakhs, with an IRR of 1.11%. While this return might seem modest, it highlights that return of premium policies charge a higher premium only to repay it at the end of the term without real growth.
On the other hand, the final pre-tax value in the ELSS fund would be ₹16.68 lakhs, with a post-tax value of ₹14.89 lakhs. The combined IRR for the ELSS investment and pure-term policy is 5.44% (post-tax return).
| ELSS Tax Calculation | |
| Maturity value after 30 years | 16,68,337 |
| Purchase price | 1,09,500 |
| Long-Term Capital Gains | 15,58,837 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 14,33,837 |
| Tax paid on LTCG | 1,79,230 |
| Maturity value after tax | 14,89,107 |
This calculation illustrates that by saving on premiums through pure-term policies, you create an opportunity to invest and grow your savings, thereby building the necessary corpus for your life goals.
Securing your family from uncertainties is a fundamental step in financial planning. Before embarking on your investment journey, it’s essential to ensure you have adequate life insurance, health coverage, and an emergency fund in place.
The PNB MetLife Aajeevan Suraksha Plan is a life insurance policy that offers coverage for a fixed term or for your entire life. If you survive the policy term, it returns the premiums paid.
There are two key aspects to consider with the PNB MetLife Aajeevan Suraksha Plan. First, a whole life cover that extends beyond your working years may not be necessary and only serves to increase your premiums and also it has a high agent commission.
Second, the return of premium option, while appealing, comes at the cost of higher premiums.
These factors make the PNB MetLife Aajeevan Suraksha Plan less suitable for your insurance needs. Instead, a pure-term life insurance policy and separate investments for your life goals is a more effective strategy for your insurance and investment needs.
When it comes to financial advice, are Quora, Facebook, and Twitter the final word?
For a well-rounded financial plan that includes insurance, investment, and tax planning, it’s wise to consult a Certified Financial Planner. Their expertise can help you choose the best options tailored to your personal financial goals, risk tolerance, and time horizon.
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