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Can the PNB MetLife Grand Assured Income Plan secure your financial future with a guaranteed steady income?
Can the PNB MetLife Grand Assured Income Plan ensure your family’s financial stability with assured returns?
Does the PNB MetLife Grand Assured Income Plan have the ability to manage your long-term financial goals?
In this article, we’ll explore whether the PNB MetLife Grand Assured Income (GAIN) Plan can provide the post-retirement income you need, examining its features, benefits, drawbacks, and returns through an Internal Rate of Return analysis to offer insights for your retirement planning.
Table of Contents:
What is the PNB MetLife Grand Assured Income (GAIN) Plan?
What are the features of the PNB MetLife Grand Assured Income (GAIN) Plan?
What are the Annuity options in the PNB MetLife Grand Assured Income (GAIN) Plan?
Who is eligible for the PNB MetLife Grand Assured Income (GAIN) Plan?
What are the benefits of the PNB MetLife Grand Assures Income (GAIN) Plan?
Grace period, Lapsed & Paid-up policies, Revival of PNB MetLife Grand Assured Income (GAIN) Plan
Free Look period for PNB MetLife Grand Assured Income (GAIN) Plan
Surrendering the PNB MetLife Grand Assured Income (GAIN) Plan
What are the advantages of the PNB MetLife Grand Assured Income (GAIN) Plan?
What are the disadvantages of the PNB MetLife Grand Assured Income (GAIN) Plan?
Research Methodology of PNB MetLife Grand Assured Income (GAIN) Plan
Benefit Illustration – IRR Analysis of PNB MetLife Grand Assured Income (GAIN) Plan
PNB MetLife Grand Assured Income (GAIN) Plan Vs. Other Investments
PNB MetLife Grand Assured Income (GAIN) Plan Vs. Pure-Term + ELSS
Final Verdict on the PNB MetLife Grand Assured Income (GAIN) Plan
What is the PNB MetLife Grand Assured Income (GAIN) Plan?
PNB MetLife Grand Assured Income Plan is an Individual, Non-Linked, Non-Participating, Deferred Annuity Product. PNB MetLife Grand Assured Income Plan helps you systematically save for your retirement and provides lifelong Guaranteed income to ensure you continue living a grand lifestyle throughout your Golden years.
What are the features of the PNB MetLife Grand Assured Income (GAIN) Plan?
- Guaranteed Income for Lifetime
- Multiple Annuity Options to choose from as per your needs
- Choose to pay a single premium or more affordable instalment premiums
- Premium/Annuity amount will vary depending upon the annuity option chosen
- Choose when to receive the annuity payments
- High Purchase price benefit to encourage you to save more
What are the Annuity options in the PNB MetLife Grand Assured Income (GAIN) Plan?
Option A: Life Annuity
Option B: Life Annuity with Return of Purchase Price
Option C: Life Annuity with Return of Purchase Price on Death or Survival
Option D: Joint Life Annuity with Return of Purchase Price (With Single Pay Only)
Option E: Joint Life Annuity with Return of Purchase Price and 50% Annuity to surviving annuitant (With Single Pay Only)
Who is eligible for the PNB MetLife Grand Assured Income (GAIN) Plan?
| Minimum | Maximum | |
| Age at Entry | 40 years | Option C (Life Annuity with Return of Purchase Price on Death or Survival): 65 yearsAll Other Annuity Options: 84 years |
| Minimum Annuity | Annual – ₹ 12,000, Half-yearly – ₹ 6,000, Quarterly – ₹ 3,000 and Monthly ₹ 1,000 | |
| Purchase Price | Single pay: ₹ 1 LakhLimited pay: ₹ 3 Lakh | No Limit |
| Premium paying term and Deferment period | Premium paying term | Deferment period |
| Single pay | 1 to 10 | |
| 5 pay | 5 to 10 | |
| 7 pay | 7 to 10 | |
| 10 pay | 10 | |
What are the benefits of the PNB MetLife Grand Assures Income (GAIN) Plan?
1.) Annuity Benefit
During Deferment Period
All Options: No Annuity payments shall be made
After Deferment Period
| Options A, B & C | An annuity is payable as long as the annuitant is alive |
| Option D | An annuity is payable as long as one of the annuitants is alive. |
| Option E |
|
2.) Death benefit
During Deferment Period
| Options A, B & C | Higher of the following amounts shall be payable
|
| Options D & E |
|
After Deferment Period
| Option A | No Death Benefit shall be payable |
| Option B | Higher of the following amounts shall be payable
|
| Option C | Post receiving the Survival Benefit, the higher of the following amounts shall be payable
Before receiving the Survival Benefit, the higher of the following amounts shall be payable
|
| Options D & E |
|
3.) Survival benefit
| Options A, B, D & E | No Survival benefit is payable |
| Option C | 50% of total premiums shall be returned to the annuitant on attainment of age 80 years or completion of 25 policy years, whichever is later. |
Grace period, Lapsed & Paid-up policies, Revival of PNB MetLife Grand Assured Income (GAIN) Plan
Grace period
The grace period for payment of the premium is 15 days, where the PNB MetLife Grand Assured Income Plan policyholder pays the premium every month and 30 days in all other cases.
Lapsed Policy
If all the due Premiums for the first two consecutive years are not paid (except for single-pay policies), the PNB MetLife Grand Assured Income Plan Policy shall lapse at the end of the grace period and no benefits shall be payable.
Reduced paid-up policy
If a policy has acquired Guaranteed Surrender Value (if at least 2 full years’ premiums have been paid) and no future instalment premiums are paid, the PNB MetLife Grand Assured Income Plan policy will continue as a paid-up policy with reduced benefits.
Revival
You can revive your lapsed / Paid-up policy within five consecutive years from the due date of the first unpaid premium.
Free Look period for PNB MetLife Grand Assured Income (GAIN) Plan
You would have a period of 15 days (30 days if the policy is purchased through a Distance Marketing channel or Electronic Policies) from the date of receiving your Policy Document to review the terms and conditions and return the policy.
Surrendering the PNB MetLife Grand Assured Income (GAIN) Plan
Before the completion of the Deferment Period
The PNB MetLife Grand Assured Income Plan policy shall acquire a surrender value basis of the premium payment mode as defined below
| Premium Payment | Surrender Value Payable |
| Single Pay | Any time after the commencement of the policy |
| Limited Pay | Provided at least 2 full years’ premiums have been paid |
The surrender value payable shall be higher of the guaranteed surrender value and special surrender value.
After the completion of the Deferment Period
No surrender benefit shall be available for Annuity Option A. For all other Plan Options – B, C, D & E; the surrender value payable shall be the special surrender value.
What are the advantages of the PNB MetLife Grand Assured Income (GAIN) Plan?
- Flexibility to change the annuity payout mode.
- Option to defer annuity/survival benefit payouts and accumulate them.
- Guaranteed Additions of 0.5% of total premiums paid will accumulate monthly until the end of the deferment period.
What are the disadvantages of the PNB MetLife Grand Assured Income (GAIN) Plan?
- There is no specified sum assured on death; instead, the total premiums paid are returned as the death benefit.
- Under Option A, the PNB MetLife Grand Assured Income Plan policy cannot be surrendered after the deferment period.
- The annuity amount remains fixed for life.
- The annuity is fully taxable.
Research Methodology of PNB MetLife Grand Assured Income (GAIN) Plan
The PNB MetLife Grand Assured Income Plan offers a way to save for retirement by providing lifetime annuities after the premium payment term and deferment period.
Upon the policyholder’s death, the annuity continues for the spouse or the total premiums paid are returned to the nominee, depending on the chosen annuity option. Let’s evaluate the plan’s cash flow in terms of return percentage to compare its effectiveness.
Benefit Illustration – IRR Analysis of PNB MetLife Grand Assured Income (GAIN) Plan
Consider a 50-year-old male who selects the PNB MetLife Grand Assured Income (GAIN) Plan with annuity Option B: Life Annuity with Return of Purchase Price. He pays an annual premium of ₹1 Lakh for 10 years, and at the end of the term, begins receiving an annual annuity of ₹79,950 for life.
| Male | 50 years |
| Sum Assured | ₹ 10,00,000 |
| Policy Term | 60 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 1,00,000 |
Assuming a life expectancy of 85 years, the IRR for this cash flow is 5.35% as per the PNB MetLife Grand Assured Income Plan maturity calculator.
This return is relatively low, and the plan provides a fixed annuity throughout the PNB MetLife Grand Assured Income Plan policyholder’s lifetime without access to the accumulated corpus.
| Age | Year | Annualised premium / Maturity benefit | Death benefit |
| 50 | 1 | -1,00,000 | 10,00,000 |
| 51 | 2 | -1,00,000 | 10,00,000 |
| 52 | 3 | -1,00,000 | 10,00,000 |
| 53 | 4 | -1,00,000 | 10,00,000 |
| 54 | 5 | -1,00,000 | 10,00,000 |
| 55 | 6 | -1,00,000 | 10,00,000 |
| 56 | 7 | -1,00,000 | 10,00,000 |
| 57 | 8 | -1,00,000 | 10,00,000 |
| 58 | 9 | -1,00,000 | 10,00,000 |
| 59 | 10 | -1,00,000 | 10,00,000 |
| 60 | 11 | 0 | 10,00,000 |
| 61 | 12 | 79,950 | 10,00,000 |
| 62 | 13 | 79,950 | 10,00,000 |
| 63 | 14 | 79,950 | 10,00,000 |
| 64 | 15 | 79,950 | 10,00,000 |
| 65 | 16 | 79,950 | 10,00,000 |
| 66 | 17 | 79,950 | 10,00,000 |
| 67 | 18 | 79,950 | 10,00,000 |
| 68 | 19 | 79,950 | 10,00,000 |
| 69 | 20 | 79,950 | 10,00,000 |
| 70 | 21 | 79,950 | 10,00,000 |
| 71 | 22 | 79,950 | 10,00,000 |
| 72 | 23 | 79,950 | 10,00,000 |
| 73 | 24 | 79,950 | 10,00,000 |
| 74 | 25 | 79,950 | 10,00,000 |
| 75 | 26 | 79,950 | 10,00,000 |
| 76 | 27 | 79,950 | 10,00,000 |
| 77 | 28 | 79,950 | 10,00,000 |
| 78 | 29 | 79,950 | 10,00,000 |
| 79 | 30 | 79,950 | 10,00,000 |
| 80 | 31 | 79,950 | 10,00,000 |
| 81 | 32 | 79,950 | 10,00,000 |
| 82 | 33 | 79,950 | 10,00,000 |
| 83 | 34 | 79,950 | 10,00,000 |
| 84 | 35 | 79,950 | 10,00,000 |
| 85 | 36 | 79,950 | 10,00,000 |
| 10,00,000 | |||
| IRR | 5.35% |
By contrast, if the same savings were placed in a bank or post office recurring deposit, a substantial corpus could be accumulated with better liquidity. The low returns and lack of access to the corpus are significant drawbacks of the PNB MetLife Grand Assured Income (GAIN) Plan.
PNB MetLife Grand Assured Income (GAIN) Plan Vs. Other Investments
In this section, we’ll explore better alternatives for channelling your retirement savings. To address the lack of access to the accumulated corpus in the PNB MetLife Grand Assured Income (GAIN) Plan, we can consider investing in financial assets that offer higher returns and greater liquidity.
Using the same scenario as before, let’s compare the potential returns.
PNB MetLife Grand Assured Income (GAIN) Plan Vs. Pure-Term + ELSS
The PNB MetLife Grand Assured Income Plan does not provide a specified death benefit; instead, the premiums paid are returned as the death benefit either during or after the deferment period.
To compensate for this, imagine taking a pure-term life insurance policy with a sum assured of ₹10 Lakhs, costing an annual premium of ₹13,300. This leaves ₹86,700 annually from the ₹1 Lakh premium, which can be directed towards retirement planning.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 10,00,000 |
| Policy Term | 10 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 13,300 |
| Investment | ₹ 86,700 |
Depending on your risk tolerance, you can select suitable investments. High-risk investors might opt for equity investments, while those with lower risk tolerance may prefer debt instruments.
In this example, we’ve chosen an Equity Linked Savings Scheme (ELSS), an equity-based investment.
| Age | Year | Term Insurance premium + ELSS | Death benefit |
| 50 | 1 | -1,00,000 | 10,00,000 |
| 51 | 2 | -1,00,000 | 10,00,000 |
| 52 | 3 | -1,00,000 | 10,00,000 |
| 53 | 4 | -1,00,000 | 10,00,000 |
| 54 | 5 | -1,00,000 | 10,00,000 |
| 55 | 6 | -1,00,000 | 10,00,000 |
| 56 | 7 | -1,00,000 | 10,00,000 |
| 57 | 8 | -1,00,000 | 10,00,000 |
| 58 | 9 | -1,00,000 | 10,00,000 |
| 59 | 10 | -1,00,000 | 10,00,000 |
| 60 | 11 | 0 | 10,00,000 |
| 61 | 12 | 79,950 | 10,00,000 |
| 62 | 13 | 79,950 | 10,00,000 |
| 63 | 14 | 79,950 | 10,00,000 |
| 64 | 15 | 79,950 | 10,00,000 |
| 65 | 16 | 79,950 | 10,00,000 |
| 66 | 17 | 79,950 | 10,00,000 |
| 67 | 18 | 79,950 | 10,00,000 |
| 68 | 19 | 79,950 | 10,00,000 |
| 69 | 20 | 79,950 | 10,00,000 |
| 70 | 21 | 79,950 | 10,00,000 |
| 71 | 22 | 79,950 | 10,00,000 |
| 72 | 23 | 79,950 | 10,00,000 |
| 73 | 24 | 79,950 | 10,00,000 |
| 74 | 25 | 79,950 | 10,00,000 |
| 75 | 26 | 79,950 | 10,00,000 |
| 76 | 27 | 79,950 | 10,00,000 |
| 77 | 28 | 79,950 | 10,00,000 |
| 78 | 29 | 79,950 | 10,00,000 |
| 79 | 30 | 79,950 | 10,00,000 |
| 80 | 31 | 79,950 | 10,00,000 |
| 81 | 32 | 79,950 | 10,00,000 |
| 82 | 33 | 79,950 | 10,00,000 |
| 83 | 34 | 79,950 | 10,00,000 |
| 84 | 35 | 79,950 | 10,00,000 |
| 85 | 36 | 79,950 | 10,00,000 |
| 39,68,407 | |||
| IRR | 7.42% |
To match the income payout of the PNB MetLife Grand Assured Income (GAIN) Plan, the ELSS units are redeemed after 10 years and reinvested in an instrument yielding a 7% return. From this, ₹79,950 is withdrawn annually to match the annuity amount.
| ELSS Tax Calculation | |
| Maturity value after 10 years | 17,04,052 |
| Purchase price | 8,67,000 |
| Long-Term Capital Gains | 8,37,052 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 7,12,052 |
| Tax paid on LTCG | 89,007 |
| Maturity value after tax | 16,15,046 |
At maturity, the ELSS investment grows to a pre-tax value of ₹17.04 lakhs. After accounting for capital gains tax, the post-tax value is ₹16.15 lakhs, which is then invested for annual withdrawals.
Finally, at age 85, the remaining investment (₹ 39.68 Lakhs) is fully withdrawn to match the return of premium under the PNB MetLife GAIN Plan.
The combined Internal Rate of Return (IRR) for this strategy, including the ELSS investment and pure-term life insurance, is 7.42% (post-tax). This alternative investment approach offers superior returns and greater access to funds compared to the PNB MetLife Grand Assured Income (GAIN) Plan.
Final Verdict on the PNB MetLife Grand Assured Income (GAIN) Plan
Retirement planning involves two key phases: the accumulation phase and the distribution phase. In the PNB MetLife Grand Assured Income (GAIN) Plan, after completing the accumulation phase and deferment period, you begin receiving a fixed annuity.
You can select from various annuity options based on your needs, with payments continuing throughout your lifetime or to your spouse after your passing. Some plan options also include a return of premium as a death benefit.
The main drawback of the PNB MetLife Grand Assured Income Plan is the lack of flexibility after the accumulation phase; you cannot freely access the corpus, as it is locked into the chosen annuity. Additionally, the plan offers low returns, which may not keep pace with inflation and also it has a high agent commission.
Due to these limitations—low returns and poor liquidity—the PNB MetLife Grand Assured Income (GAIN) Plan may not be the best choice.
By accumulating your retirement savings through alternative means, you maintain full control over your corpus, allowing you to use it for other goals, and emergencies, or invest in higher-yielding products. It’s also crucial to ensure you have sufficient life insurance coverage until retirement.
In today’s demanding work environment, particularly in India where job security can be uncertain, achieving FIRE (Financial Independence and Retire Early) is essential. Starting early allows you to harness the power of compounding and build a substantial retirement fund.
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