Reliance Nippon Life Super Bachat Plus Suraksha Plan: Good or Bad? An Insightful Review

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Can the Reliance Nippon Life Super Bachat Plus Suraksha Plan maximize your savings to secure your future?

Can the Reliance Nippon Life Super Bachat Plus Suraksha Plan offer security and financial growth?

Can the Reliance Nippon Life Super Bachat Plus Suraksha Plan provide lifelong protection and guaranteed returns?

In this article, we will review the RNL Super Bachat Plus Suraksha Plan’s features, benefits, drawbacks, and potential returns to offer a comprehensive understanding of whether it’s the right choice for safeguarding your family’s future.

What is the RNL Super Bachat Plus Suraksha Plan?

Reliance Nippon Life Super Bachat Plus Suraksha Plan is a Non-Linked, Non-Participating, Individual Savings Life Insurance Plan. In this plan, the life cover increases every year to give you financial protection against life uncertainties, as well as help you to save for a financially secure future by creating a corpus for your different financial goals through systematic savings over a period of time.

What are the features of the RNL Super Bachat Plus Suraksha Plan?

Choose between two Plan Options at the inception of the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy
The Death Cover at the inception of the policy would be equal to 2 times or 1.5 times the Base Sum Assured and will increase thereafter throughout the policy term.
Guaranteed Maturity Addition is payable at maturity
Guaranteed Loyalty Additions as a percentage of Annualized Premium accrues at the end of every 5^th policy year to enhance your policy’s benefits.
The maturity benefit and Death Benefit are guaranteed.

	Minimum	Maximum
Age at Entry	18 years	50 years
Age at Maturity	28 years	70 years
Base Sum assured	Minimum Base Sum Assured is dependent on the Life Assured’s entry age, policy term, Premium Payment Term and annualized premium	No Limit
Premium	₹ 30,000	No Limit
Premium paying frequency	Yearly, Half-yearly, Quarterly and Monthly
Premium paying term & Policy term	Premium paying term	Policy term
	7	10
	10	10/15/20
	15	15/20
	20	20
Premium Payment option	Regular & Limited pay

What are the plan options in the RNL Super Bachat Plus Suraksha Plan?

Plan Option A: The Death Cover is equal to 2 times the Base Sum Assured and increases at a simple rate of 5% each year from the beginning of 2^nd policy year throughout the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy term.

Plan Option B: The Death Cover is equal to 1.5 times the Base Sum Assured and increases at a simple rate of 5% each year from the beginning of 2^nd policy year throughout the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy term.

What are the benefits of the RNL Super Bachat Plus Suraksha Plan?

1.) Death Benefit

In case of unfortunate demise of the Life Assured during the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy term, the nominee(s) shall receive the following benefits, based on the Plan Option chosen at inception

Higher of

Sum Assured on death plus accrued Guaranteed Loyalty Additions and
105% of Total Premiums Paid, as of the date of death of the Life Assured

Sum Assured on death is defined as a higher of

11 times the Annualized Premium and
Death Cover as per the Plan Option chosen by the policyholder at the inception of the policy.

The Death Cover is equal to

Plan option A

2 times the Base Sum Assured and increases at a simple rate of 5% each year from the beginning of the 2^nd policy year throughout the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy term.

Plan Option B

1.5 times the Base Sum Assured and increases at a simple rate of 5% each year from the beginning of 2nd policy year throughout the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy term

2.) Maturity Benefit

On survival of the Life Assured till the end of the policy term, the following benefits will be paid. Sum Assured on Maturity; plus Accrued Guaranteed Loyalty Additions.

Where the Sum Assured on Maturity is equal to the Base Sum Assured chosen at the inception of the policy plus Guaranteed Maturity Addition.

3.) Guaranteed Additions

Guaranteed Maturity Addition

Guaranteed Maturity Addition is expressed as a percentage of the Base Sum Assured and will depend on the age at entry of the Life Assured and the Plan Option, premium payment term, and policy term chosen by the policyholder at the inception of the policy.

Guaranteed Loyalty Addition

Guaranteed Loyalty Additions will accrue at the end of every 5^th Policy year and will be payable on maturity or earlier death, provided the policy is in force.

It is expressed as a percentage of the Annualized Premium and will depend on the Plan Option, premium payment term, and policy term chosen by the Reliance Nippon Life Super Bachat Plus Suraksha Plan policyholder.

Grace period, Discontinuance and Revival of RNL Super Bachat Plus Suraksha Plan

Grace period

A grace period of 30 days (15 days for monthly mode) will be given to pay your premium.

Discontinuance

If all due premiums have not been paid for the first two consecutive policy years in full, the Reliance Nippon Life Super Bachat Plus Suraksha Plan policy shall lapse at the end of the grace period.

Once a policy has acquired a surrender value (all due premiums have been paid for the first two consecutive policy years), and if the policyholder chooses to discontinue the premium payment, the policy will continue as a paid-up (or reduced paid-up) policy with reduced benefits.

Revival

A policy in lapsed or paid-up condition may be revived by the policyholder during the revival period of 5 years from the due date of the first unpaid due premium or date of maturity of the base policy whichever is earlier.

Free Look Period for RNL Super Bachat Plus Suraksha Plan

In the event you disagree with any of the policy terms or conditions, you shall have the option to return the policy to the company for cancellation within 15 days of its receipt where the policy has been obtained through other than distance marketing (30 days of receipt where the policy has been obtained through Distance Marketing mode).

Surrendering RNL Super Bachat Plus Suraksha Plan

The policy shall acquire a Surrender Value if all due premiums have been paid for the first two consecutive policy years in full.

The total Surrender Value payable during the Policy Term is higher than Guaranteed Surrender Value (GSV) and Special Surrender Value (SSV)] plus the outstanding balance in Flexi Wallet, if any.

What are the advantages of the RNL Super Bachat Plus Suraksha Plan?

A loan facility is available under the policy, up to 70% of the surrender value.
Riders can be added to boost your coverage.
Tax Benefits as per the prevailing tax laws
A High premium discount is offered for a Higher Sum Assured

What are the disadvantages of the RNL Super Bachat Plus Suraksha Plan?

The annual increase in the sum assured offers little added value to the policyholder.
While the maturity benefit is guaranteed, the returns are relatively low.

Research Methodology of RNL Super Bachat Plus Suraksha Plan

The RNL Super Bachat Plus Suraksha Plan offers regular loyalty additions and guaranteed benefits. However, the policyholder can only claim these benefits either at the time of death or upon maturity. Despite the guaranteed benefits, the cash flow pattern remains rigid.

Before considering an investment in this plan, it is essential to evaluate the returns in percentage terms.

Benefit illustration – IRR Analysis of RNL Super Bachat Plus Suraksha Plan

Here’s an illustration based on the policy brochure: A 35-year-old male chooses Plan Option A under the RNL Super Bachat Plus Suraksha Plan.

The base sum assured is ₹5,55,124, with a death cover starting at ₹11,10,248, which increases by ₹55,512 each year from the second policy year onward throughout the 15-year policy term. He pays an annual premium of ₹50,000.

Male	35 years
Sum Assured	₹ 5,55,124
Policy Term	15 years
Premium Paying Term	15 years
Annualised Premium	₹ 50,000

At the end of the policy term, he receives a maturity benefit of ₹9.43 lakhs, including guaranteed additions. The internal rate of return (IRR) for this cash flow is 2.81% as per the Reliance Nippon Life Super Bachat Plus Suraksha Plan maturity calculator.

Given the low returns, the amount could perform similarly if left in a savings bank account.

Age	Year	Annualised premium / Maturity benefit	Death benefit
35	1	-50,000	11,10,248
36	2	-50,000	11,65,760
37	3	-50,000	12,21,273
38	4	-50,000	12,76,785
39	5	-50,000	13,32,298
40	6	-50,000	13,87,810
41	7	-50,000	14,43,322
42	8	-50,000	14,98,835
43	9	-50,000	15,54,347
44	10	-50,000	16,09,860
45	11	-50,000	16,65,372
46	12	-50,000	17,20,884
47	13	-50,000	17,76,397
48	14	-50,000	18,31,909
49	15	-50,000	18,87,422
50		9,43,004

	IRR	2.81%

The returns are modest because a significant portion of the premium is allocated toward the increasing death cover, leaving little for the investment component to generate higher returns.

RNL Super Bachat Plus Suraksha Plan Vs. Other investment

The rigid cash flow, increasing death cover, and low returns make policyholders hesitant to invest in the RNL Super Bachat Plus Suraksha Plan.

Comparing its returns with alternative investments can help make the decision process clearer. Using the same metrics as the previous illustration, let’s examine the comparison.

RNL Super Bachat Plus Suraksha Plan Vs. Pure-term + PPF / ELSS

In the RNL Super Bachat Plus Suraksha Plan, the sum assured increases each year, whereas a pure-term life insurance policy offers a fixed life cover.

For example, a pure-term plan with a ₹19 lakhs Sum assured costs ₹9,000 annually for a 15-year term. This leaves you with an additional ₹41,000 per year, which can be invested according to your risk tolerance.

Pure Term Life Insurance Policy
Sum Assured	₹ 19,00,000
Policy Term	15 years
Premium Paying Term	15 years
Annualised Premium	₹ 9,000
Investment	₹ 41,000

Low-risk investors may prefer debt instruments like the Public Provident Fund (PPF), while high-risk investors might choose equity-based options like Equity-Linked Savings Schemes (ELSS). For this comparison, we’ll consider both options.

		Term Insurance + PPF		Term insurance + ELSS
Age	Year	Term Insurance premium + PPF	Death benefit	Term Insurance premium + ELSS	Death benefit
35	1	-50,000	19,00,000	-50,000	19,00,000
36	2	-50,000	19,00,000	-50,000	19,00,000
37	3	-50,000	19,00,000	-50,000	19,00,000
38	4	-50,000	19,00,000	-50,000	19,00,000
39	5	-50,000	19,00,000	-50,000	19,00,000
40	6	-50,000	19,00,000	-50,000	19,00,000
41	7	-50,000	19,00,000	-50,000	19,00,000
42	8	-50,000	19,00,000	-50,000	19,00,000
43	9	-50,000	19,00,000	-50,000	19,00,000
44	10	-50,000	19,00,000	-50,000	19,00,000
45	11	-50,000	19,00,000	-50,000	19,00,000
46	12	-50,000	19,00,000	-50,000	19,00,000
47	13	-50,000	19,00,000	-50,000	19,00,000
48	14	-50,000	19,00,000	-50,000	19,00,000
49	15	-50,000	19,00,000	-50,000	19,00,000
50		11,11,977	19,00,000	15,90,399	19,00,000

	IRR	4.78%		8.93%

At the end of the 15-year term, the PPF account is projected to grow to ₹11.11 lakhs, with an IRR of 4.78%. Meanwhile, the pre-tax maturity value of the ELSS fund could reach ₹17.11 lakhs, and after capital gains tax, the post-tax maturity value would be ₹15.90 lakhs, yielding a post-tax IRR of 8.93%.

ELSS Tax Calculation
Maturity value after 15 years	17,11,884
Purchase price	6,15,000
Long-Term Capital Gains	10,96,884
Exemption limit	1,25,000
Taxable LTCG	9,71,884
Tax paid on LTCG	1,21,486
Maturity value after tax	15,90,399

In both cases, the rate of return far exceeds that of the RNL Super Bachat Plus Suraksha Plan. Separating insurance and investment is a more effective strategy for wealth accumulation, accelerating your investment journey.

Final Verdict on RNL Super Bachat Plus Suraksha Plan

The death cover in the RNL Super Bachat Plus Suraksha Plan increases annually at a rate of 5% (simple interest) throughout the policy term.

While this is a unique feature of the plan, in personal finance, having a sum assured that covers future needs, goals, and liabilities is typically sufficient. Additional coverage is only necessary in specific situations, not on a yearly basis.

This feature adds little value to the policyholder and mainly increases the cost in terms of premiums. The return analysis shows that it is a low-yielding product and also has a high agent commission.

Despite the guaranteed benefits, the rigid cash flow and low returns make this plan less appealing to investors.

Opting for a pure-term life insurance policy with an adequate sum assured is essential. This amount should account for all future goals, needs, and liabilities.

When significant life events such as marriage, childbirth, or additional responsibilities arise, increasing the life cover becomes necessary. To achieve long-term financial goals, it is important to invest in a well-diversified portfolio.

When it comes to financial advice, are Quora, Facebook, and Twitter the final word?

Before starting your investment journey, assess your risk tolerance carefully. For a personalized financial plan, it’s advisable to consult a Certified Financial Planner who can help you choose the right products based on your unique financial situation.

Reliance Nippon Life Super Bachat Plus Suraksha Plan: Good or Bad? An Insightful Review

Table of Contents:

What is the RNL Super Bachat Plus Suraksha Plan?

What are the features of the RNL Super Bachat Plus Suraksha Plan?

What are the plan options in the RNL Super Bachat Plus Suraksha Plan?