Categories: Insurance

PNB MetLife Smart Platinum Plus Plan: Good or Bad? A Detailed ULIP Review

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Can the PNB MetLife Smart Platinum Plus Plan offer flexibility and the potential for wealth creation?

Can the PNB MetLife Smart Platinum Plus Plan secure your financial future with protection and growth?

Is the PNB MetLife Smart Platinum Plus Plan the perfect blend of security and investment opportunities?

In this review, we’ll explore its features, benefits, drawbacks, and associated costs. Additionally, we’ll analyse potential returns to help you make an informed decision.

What is the PNB MetLife Smart Platinum Plus?

PNB MetLife Smart Platinum Plus is an Individual, unit-linked, Non-participating, Life Insurance Plan. PNB MetLife Smart Platinum Plus is a whole life protection and savings-oriented unit-linked insurance plan that offers life insurance cover to protect your family in case of your unfortunate demise and provides an opportunity for wealth creation.

What are the features of PNB MetLife Smart Platinum Plus?

Two plan options are available for selection.
Enjoy life coverage till maturity, even with limited premium payments.
Enhance your fund value with Fund Management Charge returns and a Fund Booster.
Protect your financial goals with the Care Benefit.
Customize your wealth plan with a range of portfolio strategies.
Choose from various funds tailored to match your risk profile.

What are the plan options in PNB MetLife Smart Platinum Plus?

Option 1 Wealth Option:

It offers whole-life cover.

Option 2 Wealth + Care Option:

Additional health protection through Care Benefit – The Company pays all future Premiums on diagnosis of any one of the 5 listed critical illnesses

Who is eligible for the PNB MetLife Smart Platinum Plan?

	Wealth Option	Wealth + Care Option
Age at Entry	Minimum – 30 days Maximum – 70 years	Minimum – 18 years Maximum – 65 years
Maturity option	Maturity option 1: 80 years Maturity option 2: 99 years
Minimum Premium paying term	Single premium Regular premium – 10 years Limited premium – 5 years	Limited premium – 6 years
Maximum paying term	Single premium Regular premium – years Limited premium – years	25 (subject to not exceeding 75 years)
Minimum Annualised Premium	Premium payment mode	Annualised premium
	Single	1,50,000
	Annual	48,000
	Semi-annual	60,000
	Monthly	1,20,000
Maximum Annualised premium	As per board
Sum assured Multiple	1.25 (Single premium) 7 (other than single premium)	10 (Single premium) Based on age (other than single premium)
Sum assured	For Single Premium: 1,87,500 For Regular/Limited Premium: 3,36000	Annualised Premium (or Single Premium) Sum Assured covers multiple given above
Premium Payment Mode	Annual, Half-Yearly and Monthly

What are the benefits of the PNB MetLife Smart Platinum Plus?

1.) Maturity benefit

On survival of the Life Assured till the end of the PNB MetLife Smart Platinum Plus policy term, the maturity benefit which is equal to the total fund value as of the maturity date is payable.

2.) Death benefit

If the Life Assured’s death occurs while the PNB MetLife Smart Platinum Plus Policy is in force, the death benefit payable will be higher of

The Fund Value on the date of death;
The Sum Assured after deducting all Partial Withdrawals made during the 2-year period immediately preceding the Life Assured’s death;
105% of the total Premiums paid excluding partial withdrawals made during the 2-year period immediately preceding the date of death of the Life Assured.

3.) Return of charges and Boosters

Return of Fund Management charges

Total FMC charges deducted till the end of the 5^th policy year# will be added back to the fund value at the end of the 6^th policy year.

Fund boosters

Fund Boosters will be allocated to your PNB MetLife Smart Platinum Plus policy at the end of the 10^th policy year.

What are the Investment Strategies and Fund Options in PNB MetLife Smart Platinum Plus?

PNB MetLife Smart Platinum Plus gives you the choice of three fund management strategies to choose from as per your risk appetite & convenience. You need to select any one from the following fund management strategies.

i.) Self-managed strategy

With this strategy, you can allocate your premiums directly amongst the available funds in proportions of your choice.

You have the option of switching amongst the funds as mentioned below and may choose a premium redirection option for your future premiums depending on your changing risk appetite and market conditions. The details of the various funds are given in the table below:

		Asset Category
S. No	Fund Name	Equities	Debt	Money Market	Risk Profile
1	Mid-cap fund	60-100%	0	0-40%	Very High Risk
2	Premier Multi cap fund	60-100%	0	0-40%	Very High Risk
3	Virtue II fund	60-100%	0	0-40%	Very High Risk
4	Crest (Thematic Fund)	60-100%	0	0-40%	Very High Risk
5	Flexi cap fund	60-100%	0	0-40%	Very High Risk
6	Small cap fund	60-100%	0	0-40%	Very High Risk
7	Multiplier III	60-100%	0	0-40%	Very High Risk
8	Balanced opportunities fund	40-75%	25-60%	0-35%	Medium Risk
9	Balancer II fund	0-60%	Govt & debt Securities -0-60%	0-40%	Medium Risk
10	Protector II fund	0	Govt & debt Securities -0-60%	0-40%	Low Risk
11	Bond opportunities fund	0	80-100%	0-20%	Low Risk
12	Liquid fund	0	0	100%	Low Risk
13	Bharat Manufacturing fund	60-100%	0	0-40%	Very High Risk
14	Bharat Consumption Fund	60-100%	0	0-40%	Very High Risk
15	Nifty 500 Momentum 50 Index Fund	60-100%	0	0-40%	Very High Risk

ii.) Systematic transfer strategy

The Systematic Transfer Strategy helps safeguard your wealth against market volatility and is available only if you have opted for a Regular Pay or Limited Pay policy with annual frequency as the premium payment mode.

This strategy ensures a gradual exposure to equity from debt in a phased manner through equal instalments over 12 months. All instalment premiums will be invested in the Protector II Fund (debt-oriented fund).

This amount will be systematically transferred to the Premier Multi-cap Fund (equity-oriented fund) over the 12-month Policy period.

iii.) Life stage strategy

At policy inception, your premium, net of allocation charge is distributed between two funds, Premier Multi-cap Fund (equity-oriented fund) and Protector II Fund (debt-oriented fund), based on your attained age.

As you move from one age band to another, your funds are re-distributed based on your age. The age-wise portfolio distribution is shown in the table.

AGE OF POLICYHOLDER (YEARS)	PREMIER MULTI-CAP FUND	PROTECTOR II FUND
Up to 30	70%	30%
31 – 40	60%	40%
41 – 50	50%	50%
51 – 60	40%	60%
61 – 70	20%	80%
71+	10%	90%

What are the Charges for the PNB MetLife Smart Platinum Plus?

A. Mortality charges

Mortality charge will be based on the Plan Option, attained the age of the Life Insured, Rate as per the Mortality Charge Table, and the applicable Sum at Risk.

B. Morbidity charges (Wealth + care option only)

The morbidity charge will be based on the attained age of the Life Insured, the Morbidity Rate and the applicable Sum at Risk.

C. Partial withdrawal charges

You can make unlimited Partial Withdrawals in a PNB MetLife Smart Platinum Plus Policy Year free of any charge.

D. Premium allocation charges

These are expressed as a percentage of the premium and are levied through the first 10 years only. It is deducted from the premium amount at the time of premium payment and balance units are allocated in the chosen funds thereafter.

Policy year	Single premium policies	Other than single premium policies
1	3%	12%
2 to 5	NA	4.20%
6 to 10	NA	2.50%
11 onwards	NA	NA

E. Policy administration charges

Policy administration charges of ₹ 420 p.a. will be levied at the beginning of each policy month from the unit fund by cancelling units for an equivalent amount

F. Fund Management charges

S No	Fund Name	Charge per annum
1	Protector II fund	1.00%
2	Bond opportunities fund	1.00%
3	Liquid fund	1.00%
4	Balancer II fund	1.15%
5	Balanced opportunities fund	1.15%
6	Multiplier III	1.25%
7	Premier Multi cap fund	1.25%
8	Mid-cap fund	1.25%
9	Crest (Thematic Fund)	1.25%
10	Flexi cap fund	1.25%
11	Virtue II fund	1.25%
12	Small cap fund	1.25%
13	Bharat Manufacturing fund	1.25%
14	Bharat Consumption Fund	1.25%
15	Nifty 500 Momentum 50 Index Fund	1.25%
	Discontinued Fund	0.50%

G. Discontinuance charges

The Discontinuance Charges are expressed either as a percentage of the fund value (FV) or as a percentage of the annualized premium (AP) or Single Premium. It depends on the premium amount, year of discontinuance and premium paying term.

H. Switching charges

You can make unlimited switches in a Policy Year free of any charge.

Inference from the charges: the above charges are relatively high compared to other market-linked investments. Moreover, there is no transparency in investment when compared to other market-related investments.

Premium allocation charges, policy administration fees, and discontinuance charges serve as overhead costs for investors. In the long run, this added cost can significantly diminish your returns.

Grace Period, Discontinuance and Revival of PNB MetLife Smart Platinum Plus

Grace period

A grace period of 30 days (15 days for monthly mode) from the due date of unpaid Premium will be allowed to pay all your due Premiums.

Discontinuance

For other than single-pay policies

In case of discontinuance of policy during the lock-in period: the policy will move to the Discontinued Status. The Fund Value as of the date of discontinuance shall be transferred to the Discontinued Policy Fund after deducting the applicable discontinuance charge and all risk cover(s) under the Policy, shall cease.

At the end of the lock-in period, the proceeds of the discontinuance fund shall be paid to the policyholder and the policy shall terminate.

In case of discontinuance of policy after the lock-in period: the policy shall attain reduced Paid-up Status with reduced Paid-up Sum Assured.

The Paid-up sum assured is given the original sum assured multiplied by the total number of premiums paid to the original number of premiums payable as per the terms and conditions of the policy.

For single-pay policies

In case of surrender during the first five policy years (lock-in period), the Total Fund Value under the said Policy, after the deduction of Discontinuance Charges, will be transferred to the Discontinued Policy Fund. The proceeds from the discontinuance fund shall be paid at the end of the lock-in period.

In case of surrender after the first five policy years (lock-in period), the policyholder has the option to surrender the policy at any time. Upon receipt of a request for surrender after the first five years, the fund value as of the date of surrender shall be payable

Revival

The PNB MetLife Smart Platinum Plus Policyholder has the option to revive the policy, within a revival period of three years from the date of discontinuance of the policy.

Free Look period for PNB MetLife Smart Platinum Plus

If You have any objections to the terms and conditions of Your Policy, you may cancel the policy within 30 days from the date of receipt of the Policy Document, whether received electronically or otherwise.

Surrendering PNB MetLife Smart Platinum Plus

During the first five policy years, on receipt of surrender intimation, the Fund Value after deduction of applicable Discontinuance Charge, shall be transferred to the Discontinued Policy Fund.

The proceeds of the discontinued policy shall be paid at the end of the lock-in period. Only fund management charges will be deducted from this fund during this period.

After Completion of the first five years, on receipt of surrender intimation, you will be entitled to the total Fund Value under the policy.

What are the advantages of PNB MetLife Smart Platinum Plus?

You have the flexibility to increase or decrease your Sum Assured as needed.
The premium redirection option allows you to change the allocation of future premiums at no additional cost.
You can switch partially or fully between available segregated fund options
Partial withdrawals are permitted only after the Lock-in Period (5 policy anniversaries) has ended, or when the Life Assured turns 18, whichever occurs later.

What are the disadvantages of PNB MetLife Smart Platinum Plus?

Policy loans are not permitted under this plan.
Top-up premium is not allowed.
The PNB MetLife Smart Platinum Plus policy has a lock-in period of five years.
Only the net premium, after deducting charges, is invested.
The life cover provided is insufficient.

Research methodology of PNB MetLife Smart Platinum Plus

Estimating potential returns is crucial when evaluating the PNB MetLife Smart Platinum Plus, as it allows for comparison with other investment options, helping you make informed decisions. Below is an Internal Rate of Return (IRR) calculation based on the figures provided in the policy brochure.

Benefit Illustration – IRR Analysis of PNB MetLife Smart Platinum Plus

Consider a 40-year-old male who purchases the PNB MetLife Smart Platinum Plus with a sum assured of ₹15 Lakhs. The policy term is 60 years, and the premium payment term is 10 years, with an annual premium of ₹1 Lakh. He opts for Plan Option 1: Wealth.

Male	40 years
Sum Assured	₹ 15,00,000
Policy Term	60 years
Premium Paying Term	10 years
Annualised Premium	₹ 1,00,000

Under the Wealth option, the fund value is accessible at the end of the policy term, assuming all premiums are paid on time. The policy brochure provides illustrations of potential returns based on assumed investment rates of 4% and 8%.

It’s important to note that these returns are not guaranteed and do not represent the upper or lower limits of what you might earn with this policy. The maturity benefit will depend on various factors, including the policy’s future performance.

		At 4% p.a.		At 8% p.a.
Age	Year	Annualised premium / Maturity benefit	Death benefit	Annualised premium / Maturity benefit	Death benefit
40	1	-1,00,000	15,00,000	-1,00,000	15,00,000
41	2	-1,00,000	15,00,000	-1,00,000	15,00,000
42	3	-1,00,000	15,00,000	-1,00,000	15,00,000
43	4	-1,00,000	15,00,000	-1,00,000	15,00,000
44	5	-1,00,000	15,00,000	-1,00,000	15,00,000
45	6	-1,00,000	15,00,000	-1,00,000	15,00,000
46	7	-1,00,000	15,00,000	-1,00,000	15,00,000
47	8	-1,00,000	15,00,000	-1,00,000	15,00,000
48	9	-1,00,000	15,00,000	-1,00,000	15,00,000
49	10	-1,00,000	15,00,000	-1,00,000	15,00,000
50	11	0	15,00,000	0	15,00,000
51	12	0	15,00,000	0	15,00,000
52	13	0	15,00,000	0	15,00,000
53	14	0	15,00,000	0	15,00,000
54	15	0	15,00,000	0	15,00,000
55	16	0	15,00,000	0	15,00,000
56	17	0	15,00,000	0	15,00,000
57	18	0	15,00,000	0	15,00,000
58	19	0	15,00,000	0	15,00,000
59	20	0	15,00,000	0	15,00,000
60	21	0	15,00,000	0	15,00,000
61	22	0	15,00,000	0	15,00,000
62	23	0	15,00,000	0	15,00,000
63	24	0	15,00,000	0	15,00,000
64	25	0	15,00,000	0	15,00,000
65	26	0	15,00,000	0	15,00,000
66	27	0	15,00,000	0	15,00,000
67	28	0	15,00,000	0	15,00,000
68	29	0	15,00,000	0	15,00,000
69	30	0	15,00,000	0	15,00,000
70	31	0	15,00,000	0	15,00,000
71	32	0	15,00,000	0	15,00,000
72	33	0	15,00,000	0	15,00,000
73	34	0	15,00,000	0	15,00,000
74	35	0	15,00,000	0	15,00,000
75	36	0	15,00,000	0	15,00,000
76	37	0	15,00,000	0	15,00,000
77	38	0	15,00,000	0	15,00,000
78	39	0	15,00,000	0	15,00,000
79	40	0	15,00,000	0	15,00,000
80	41	0	15,00,000	0	15,00,000
81	42	0	15,00,000	0	15,00,000
82	43	0	15,00,000	0	15,00,000
83	44	0	15,00,000	0	15,00,000
84	45	0	15,00,000	0	15,00,000
85	46	0	15,00,000	0	15,00,000
86	47	0	15,00,000	0	15,00,000
87	48	0	15,00,000	0	15,00,000
88	49	0	15,00,000	0	15,00,000
89	50	0	15,00,000	0	15,00,000
90	51	0	15,00,000	0	15,00,000
91	52	0	15,00,000	0	15,00,000
92	53	0	15,00,000	0	15,00,000
93	54	0	15,00,000	0	15,00,000
94	55	0	15,00,000	0	15,00,000
95	56	0	15,00,000	0	15,00,000
96	57	0	15,00,000	0	15,00,000
97	58	0	15,00,000	0	15,00,000
98	59	0	15,00,000	0	15,00,000
99	60	0	15,00,000	0	15,00,000
100		34,80,421		2,84,25,519

	IRR	2.27%		6.19%

At a 4% return, the estimated fund value is ₹34.80 Lakhs, resulting in an IRR of 2.27% as per the PNB MetLife Smart Platinum Plus Plan maturity calculator, which is lower than the interest rate offered by a typical savings account.

At an 8% return, the fund value is projected to be ₹2.84 Crores, yielding an IRR of 6.19% as per the PNB MetLife Smart Platinum Plus Plan maturity calculator, which is comparable to or sometimes lower than the interest rates on bank fixed deposits.

Given the long wait until the fund value becomes available at age 99, the return on investment may not be worthwhile. The sum assured is relatively low, and extending life cover until age 99 is generally not recommended.

The fund value is accessible to the PNB MetLife Smart Platinum Plus Plan policyholder either upon death or at age 99, raising concerns about the practical utility of the savings. These factors make the PNB MetLife Smart Platinum Plus a less attractive option.

PNB MetLife Smart Platinum Plus Vs. Other Investments

Comparing different products simplifies the decision-making process. Let’s apply the same metric as in the previous example to create an alternative scenario, but this time we’ll separate the insurance and investment components for a clearer comparison with PNB MetLife Smart Platinum Plus.

PNB MetLife Smart Platinum Plus Vs. Pure-Term + ELSS

For the life insurance component, we’ll use a pure term life insurance policy with a sum assured of ₹15 Lakhs. The policy term is 30 years, with a 10-year premium payment period at an annual premium of ₹27,200.

This leaves you with ₹72,800 per year, which can be invested according to your risk preference.

Pure Term Life Insurance Policy
Sum Assured	₹ 15,00,000
Policy Term	30 years
Premium Paying Term	10 years
Annualised Premium	₹ 27,200
Investment	₹ 72,800

Low-risk investors might opt for debt instruments like the Public Provident Fund (PPF), while high-risk investors may lean towards equity instruments such as Equity-Linked Savings Schemes (ELSS) funds. In this scenario, we’ve chosen an ELSS fund for investment, which is also a market-linked product.

		Term insurance + ELSS
Age	Year	Term Insurance premium + ELSS	Death benefit
40	1	-1,00,000	15,00,000
41	2	-1,00,000	15,00,000
42	3	-1,00,000	15,00,000
43	4	-1,00,000	15,00,000
44	5	-1,00,000	15,00,000
45	6	-1,00,000	15,00,000
46	7	-1,00,000	15,00,000
47	8	-1,00,000	15,00,000
48	9	-1,00,000	15,00,000
49	10	-1,00,000	15,00,000
50	11	0	15,00,000
51	12	0	15,00,000
52	13	0	15,00,000
53	14	0	15,00,000
54	15	0	15,00,000
55	16	0	15,00,000
56	17	0	15,00,000
57	18	0	15,00,000
58	19	0	15,00,000
59	20	0	15,00,000
60	21	0	15,00,000
61	22	0	15,00,000
62	23	0	15,00,000
63	24	0	15,00,000
64	25	0	15,00,000
65	26	0	15,00,000
66	27	0	15,00,000
67	28	0	15,00,000
68	29	0	15,00,000
69	30	0	15,00,000
70	31	0	15,00,000
71	32	0	15,00,000
72	33	0	15,00,000
73	34	0	15,00,000
74	35	0	15,00,000
75	36	0	15,00,000
76	37	0	15,00,000
77	38	0	15,00,000
78	39	0	15,00,000
79	40	0	15,00,000
80	41	0	15,00,000
81	42	0	15,00,000
82	43	0	15,00,000
83	44	0	15,00,000
84	45	0	15,00,000
85	46	0	15,00,000
86	47	0	15,00,000
87	48	0	15,00,000
88	49	0	15,00,000
89	50	0	15,00,000
90	51	0	15,00,000
91	52	0	15,00,000
92	53	0	15,00,000
93	54	0	15,00,000
94	55	0	15,00,000
95	56	0	15,00,000
96	57	0	15,00,000
97	58	0	15,00,000
98	59	0	15,00,000
99	60	0	15,00,000
100		36,19,36,487

	IRR	11.11%

For the ELSS fund, the pre-tax maturity value is ₹41.35 Crores. After accounting for capital gains tax, the final maturity amount is ₹36.19 Crores, resulting in a post-tax IRR of 11.11%.

For comparison, we’ve assumed redemption at the age of 99, but the ELSS fund offers the flexibility to withdraw funds as needed, without restrictions.

ELSS Tax Calculation
Maturity value after 60 years	41,35,19,842
Purchase price	7,28,000
Long-Term Capital Gains	41,27,91,842
Exemption limit	1,25,000
Taxable LTCG	41,26,66,842
Tax paid on LTCG	5,15,83,355
Maturity value after tax	36,19,36,487

Given the whole life cover and the availability of the fund value only at age 99, the PNB MetLife Smart Platinum Plus may not be the most practical or advantageous investment option.

Final Verdict on PNB MetLife Smart Platinum Plus

The PNB MetLife Smart Platinum Plus offers whole-life coverage paired with equity investment opportunities. However, in personal finance, it’s generally advised to have life coverage only until your working years, as your retirement savings should support your post-retirement needs.

This makes the whole-life coverage feature less relevant. Additionally, the sum assured under this plan is insufficient.

When analysing returns, it becomes evident that the market-linked investments offered by this plan yield returns comparable to debt instruments over the long term and also have a high agent commission. This makes it a poor choice for those looking to build wealth.

It’s crucial to ensure you have adequate life coverage during your working years, which can be effectively achieved with a pure-term life policy, available at an affordable premium. Focus on building an investment portfolio that aligns with your life goals and risk tolerance.

Always assess the potential returns of any financial product before investing. If you need guidance, consider consulting a Certified Financial Planner who can offer expert advice on the various products available in the market.