PNB MetLife Grand Assured Income Plan: Good or Bad? An Insightful Review

Listen to this article

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.

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	100% Annuity is payable as long as both of the annuitants are alive 50% Annuity is payable post-death of one annuitant and while one of the annuitants is alive.

2.) Death benefit

During Deferment Period

Options A, B & C

Higher of the following amounts shall be payable

Total Premiums paid till the date of death plus accrued Guaranteed Additions (if any) till the date of death
105% of total premiums paid till the date of death

Options D & E

On the death of any one of the annuitants, no amount shall be payable
On the death of both the annuitants, the higher of the following amounts shall be payable:

Total Premiums paid till the date of death plus accrued Guaranteed Additions (if any) till the date of death
105% of total premiums paid till the date of death

After Deferment Period

Option A	No Death Benefit shall be payable
Option B	Higher of the following amounts shall be payable Total Premiums paid till the date of death plus accrued Guaranteed Additions (if any) less annuity payouts paid till the date of death 100% of total premiums paid till the date of death
Option C	Post receiving the Survival Benefit, the higher of the following amounts shall be payable 50% of the Total Premiums paid till the date of death plus Accrued Guaranteed Additions (if any) less annuity payouts paid till the date of death 50% of total premiums paid till the date of death Before receiving the Survival Benefit, the higher of the following amounts shall be payable Total Premiums paid till the date of death plus accrued Guaranteed Additions (if any) less annuity payouts paid till the date of death 100% of total premiums paid till the date of death
Options D & E	On the death of any one of the annuitants, no amount shall be payable On the death of both the annuitants, the higher of the following amounts shall be payable: Total Premiums paid till the date of death plus accrued Guaranteed Additions (if any) less annuity payouts paid till the date of death 100% of total premiums paid till the date of death

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.

Do Facebook, Twitter, and Quora have the last word when it comes to financial advice?

Certified Financial Planners can help you develop personalized strategies to reach your FIRE goals effectively.

PNB MetLife Grand Assured Income Plan: Good or Bad? An Insightful Review

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?