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Can the Shriram Life Premier Assured Benefit Plan secure your family’s future while guaranteeing financial stability?
Can the Shriram Life Premier Assured Benefit Plan help you achieve your dreams with assured benefits and flexibility?
Can the Shriram Life Premier Assured Benefit Plan be your trusted partner for creating a legacy of financial security?
In this comprehensive review, we will explore the features, benefits, and drawbacks of the Shriram Life Premier Assured Benefit plan to help you determine its suitability for your financial objectives.
Table of Contents:
What is the Shriram Life Premier Assured Benefit Plan?
What are the features of the Shriram Life Premier Assured Benefit Plan?
Who is eligible for the Shriram Life Premier Assured Benefit Plan?
What are the benefits of the Shriram Life Premier Assured Benefit Plan?
Grace period, Lapsed and Paid-up Policies and Revival of Shriram Life Premier Assured Benefit Plan
Free Look Period for Shriram Life Premier Assured Benefit Plan
Surrendering Shriram Life Premier Assured Benefit Plan
What are the advantages of the Shriram Life Premier Assured Benefit Plan?
What are the disadvantages of the Shriram Life Premier Assured Benefit Plan?
Research Methodology of the Shriram Life Premier Assured Benefit Plan
Benefit Illustration – IRR Analysis of Shriram Life Premier Assured Benefit Plan
Shriram Life Premier Assured Benefit Plan Vs. Other Investments
Shriram Life Premier Assured Benefit Plan Vs. Pure-term + PPF/ELSS
Final Verdict on Shriram Life Premier Assured Benefit Plan
What is the Shriram Life Premier Assured Benefit Plan?
Shriram Life Premier Assured Benefit Plan is a Non-Linked Non-Participating Individual Life Insurance Savings Plan. Shriram Life Premier Assured Benefit Plan offers two life cover options and three ways to receive pay-outs.
Shriram Life Premier Assured Benefit Plan combines life insurance with guaranteed returns. Choose a pay-out option according to your current financial goals and you can change pay-out options, as and when your life goal changes.
What are the features of the Shriram Life Premier Assured Benefit Plan?
- Choose from 2 life cover options: Life and Life Plus.
- Flexible premium payment terms: Single payment or spread over 6, 8, or 10 years.
- Policy term options range from a minimum of 10 years to a maximum of 20 years.
- Enjoy guaranteed benefits coupled with attractive returns.
- Receive benefits in 3 flexible ways: Income, Instalment Settlement, or Lump Sum Settlement.
- Easily switch your pay-out option at any time before the benefit pay-out begins.
Who is eligible for the Shriram Life Premier Assured Benefit Plan?
| Minimum | Maximum | |
| Age at entry | 30 days | 50 years for Life Plus option 60 years for Life option |
| Maturity age | 18 years | 70 years for Life Plus option 75 years for Life option |
| Policy term | 10/12/15 to 20 years | |
| Premium paying term | For Policy Term of 10 years: 6 years and Single Pay For Policy Term of 12 years: 6 years For Policy Term 15 to 20 years: 6,8,10 years |
|
| Premium mode | Single, Yearly, Half-Yearly, Quarterly, Monthly | |
| Premium Range | Yearly: 60,000 Half-yearly: 31,000 Quarterly: 15,500 Monthly: 5,500 Single pay: 3,00,000 |
No Limit |
What are the benefits of the Shriram Life Premier Assured Benefit Plan?
Death benefit
Life Option
The death benefit is paid immediately in a lump sum and the Shriram Life Premier Assured Benefit Plan policy will be terminated
Life plus Option
The death benefit is paid in equal monthly instalments starting from the month of death till the end of the Shriram Life Premier Assured Benefit Plan policy term or subject to a minimum of 36 instalments.
In addition to the above death benefit, any income/settlement/lump sum benefits due from the date of death will continue to be paid as per the chosen pay-out option as if the life assured were alive and the Shriram Life Premier Assured Benefit Plan policy will be terminated on payment of the last payout.
However, the nominee has the option to take all the above benefits in a lump sum.
Survival benefit
Annual payouts, as a percentage of the annualized/single premium (as per the table below) are paid from the policy anniversary after the end of the premium paying term (1st policy anniversary for Single Pay) till the end of the Shriram Life Premier Assured Benefit Plan policy term.
This benefit is not available if the policyholder chooses the settlement option.
| Premium paying term | Payout as % of annualised/single premium |
| 1 | 4.25% |
| 6 | 25% |
| 8 | 45% |
| 10 | 70% |
Maturity benefit
On survival of the life assured up to the end of the policy term, provided the policy is in force, the maturity sum assured is paid as follows
For Income/ Settlement in Lump Sum: Maturity Sum Assured is paid in a lump sum on the date of maturity.
For Settlement in instalments: Maturity Sum Assured is paid in four equal annual instalments. The first instalment payment starts on the date of maturity
Maturity Sum assured = Maturity Benefit factor X Premium Paying Term X (Annualised premium / Single Premium)
Grace period, Lapsed and Paid-up Policies and Revival of Shriram Life Premier Assured Benefit Plan
Grace Period
A grace period of 30 days for payment of premium for non-monthly modes and 15 days for monthly modes is allowed.
Lapsed Policy
If at least one full-year premium has not been paid and the premium due is not paid till the end of the grace period, the Shriram Life Premier Assured Benefit Plan policy will lapse and no benefits will be payable under the policy.
Paid-up Policy
Policies that have acquired surrender value (at least one full-year premium has been paid) will become paid up if no further premiums have been paid.
Revival
A lapsed or paid-up policy can be revived within a revival period of five years from the date of the first unpaid premium.
Free Look Period for Shriram Life Premier Assured Benefit Plan
In the event a policyholder disagrees with any of the policy terms or conditions, or otherwise and has not made any claim, he shall have the option to return the policy within a period of 30 days beginning from the date of receipt of the policy document, whether received electronically or otherwise.
Surrendering Shriram Life Premier Assured Benefit Plan
To get the surrender value, you must have paid at least the first full policy year’s premium(s) and completed the first policy year. On surrendering the policy, you will receive a Surrender Value, which is higher of the Guaranteed Surrender Value (GSV) or Special Surrender Value (SSV)
What are the advantages of the Shriram Life Premier Assured Benefit Plan?
- Avail loans of up to 80% of the surrender value under the Shriram Life Premier Assured Benefit plan.
- The Life Plus option includes an inbuilt waiver of premium feature, ensuring income or maturity benefits are paid even in the absence of the policyholder.
- Enjoy higher benefits by opting for a higher premium.
- The Single Pay Option provides a guaranteed cash pay-out starting from the first policy anniversary.
- Enhance your coverage with 4 optional rider options.
What are the disadvantages of the Shriram Life Premier Assured Benefit Plan?
- Survival benefits are not applicable if the settlement option is chosen.
- The life cover provided under Shriram Life Premier Assured Benefit Plan is insufficient.
- Opting for annual income benefits may encourage unnecessary expenses.
- Shriram Life Premier Assured Benefit Plan offers comparatively low returns.
- Early withdrawals can hinder the compounding growth of your investments.
Research Methodology of the Shriram Life Premier Assured Benefit Plan
The Shriram Life Premier Assured Benefit Plan provides fixed cash payouts during the final four years of the policy term or annual income payouts starting after the premium payment term, along with a lump sum benefit at maturity. To evaluate its suitability, let’s analyse the cash flow pattern and calculate the Internal Rate of Return (IRR).
Benefit Illustration – IRR Analysis of Shriram Life Premier Assured Benefit Plan
Consider a 30-year-old male opting for the Life Option under Shriram Life Premier Assured Benefit plan with a 15-year policy term and a base sum assured of ₹16,50,000. He pays an annual premium of ₹1,50,000 for 10 years.
Starting from the 16th policy year, he receives ₹7,03,547 annually for four years. The calculated IRR for this cash flow is 5.30%.
| Male | 30 years |
| Sum Assured | ₹ 16,50,000 |
| Policy Term | 15 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 1,50,000 |
| Age | Year | Annualised premium / Maturity benefit | Death benefit |
| 30 | 1 | -1,50,000 | 16,50,000 |
| 31 | 2 | -1,50,000 | 16,50,000 |
| 32 | 3 | -1,50,000 | 16,50,000 |
| 33 | 4 | -1,50,000 | 16,50,000 |
| 34 | 5 | -1,50,000 | 16,50,000 |
| 35 | 6 | -1,50,000 | 16,50,000 |
| 36 | 7 | -1,50,000 | 16,50,000 |
| 37 | 8 | -1,50,000 | 16,50,000 |
| 38 | 9 | -1,50,000 | 16,50,000 |
| 39 | 10 | -1,50,000 | 16,50,000 |
| 40 | 11 | 0 | 16,50,000 |
| 41 | 12 | 0 | 16,50,000 |
| 42 | 13 | 0 | 16,50,000 |
| 43 | 14 | 0 | 16,50,000 |
| 44 | 15 | 0 | 16,50,000 |
| 45 | 16 | 7,03,547 | 16,50,000 |
| 46 | 17 | 7,03,547 | 16,50,000 |
| 47 | 18 | 7,03,547 | 16,50,000 |
| 48 | 19 | 7,03,547 | 16,50,000 |
| 49 | |||
| IRR | 5.30% |
While Shriram Life Premier Assured Benefit Plan offers guaranteed and regular payouts, the returns are relatively low and may not meet the expectations of most investors.
Additionally, the periodic payouts may be insufficient for substantial financial needs and could lead to unnecessary expenses. The life cover provided is also inadequate to ensure the family’s long-term financial security.
Given its low returns, rigid cash flow structure, and limited life cover, the Shriram Life Premier Assured Benefit Plan falls short as a viable investment option.
Shriram Life Premier Assured Benefit Plan Vs. Other Investments
The Shriram Life Premier Assured Benefit Plan combines life cover and investment, resulting in suboptimal returns. A more effective strategy is to separate these components into distinct products.
Let’s explore better alternatives that can achieve the same cash payouts and life cover as offered by the Shriram Life Premier Assured Benefit Plan.
Shriram Life Premier Assured Benefit Plan Vs. Pure-term + PPF/ELSS
Using the same parameters as the previous example, a pure-term life insurance policy with a sum assured of ₹16.50 lakhs requires an annual premium of ₹8,000 for a 15-year term with a 10-year premium payment period.
This leaves ₹1,42,000 annually, which can be invested based on your risk appetite.
| Pure Term Life Insurance Policy | |
| Sum Assured | ₹ 16,50,000 |
| Policy Term | 15 years |
| Premium Paying Term | 10 years |
| Annualised Premium | ₹ 8,000 |
| Investment | ₹ 1,42,000 |
For low-risk investors, debt instruments like the Public Provident Fund (PPF) are a suitable option, while higher-risk investors may prefer equity-based options such as Equity-Linked Savings Schemes (ELSS). For this analysis, both scenarios are considered.
| Term Insurance + PPF | Term insurance + ELSS | ||||
| Age | Year | Term Insurance premium + PPF | Death benefit | Term Insurance premium + ELSS | Death benefit |
| 30 | 1 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 31 | 2 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 32 | 3 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 33 | 4 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 34 | 5 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 35 | 6 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 36 | 7 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 37 | 8 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 38 | 9 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 39 | 10 | -1,50,000 | 16,50,000 | -1,50,000 | 16,50,000 |
| 40 | 11 | 0 | 16,50,000 | 0 | 16,50,000 |
| 41 | 12 | 0 | 16,50,000 | 0 | 16,50,000 |
| 42 | 13 | 0 | 16,50,000 | 0 | 16,50,000 |
| 43 | 14 | 0 | 16,50,000 | 0 | 16,50,000 |
| 44 | 15 | 0 | 16,50,000 | 0 | 16,50,000 |
| 45 | 16 | 7,03,547 | 16,50,000 | 7,03,547 | 16,50,000 |
| 46 | 17 | 7,03,547 | 16,50,000 | 7,03,547 | 16,50,000 |
| 47 | 18 | 7,03,547 | 16,50,000 | 7,03,547 | 16,50,000 |
| 48 | 19 | 12,23,386 | 16,50,000 | 30,88,744 | 16,50,000 |
| 49 | |||||
| IRR | 6.62% | 10.02% | |||
PPF Scenario: A minimum annual contribution of ₹500 is required for 15 years. Since the premium payment term is 10 years, adjustments are made for the last five years’ contributions to meet this requirement. The PPF matures at ₹29.74 lakhs.
With annual withdrawals, the IRR is 6.62% as per the Shriram Life Premier Assured Benefit Plan’s Maturity Calculator.
ELSS Scenario: The pre-tax value of the ELSS fund grows to ₹49.18 lakhs. After accounting for capital gains tax, the post-tax value is ₹44.96 lakhs. With annual withdrawals, the IRR is 10.02% as per the Shriram Life Premier Assured Benefit Plan’s Maturity Calculator.
| ELSS Tax Calculation | |
| Maturity value after 15 years | 49,18,609 |
| Purchase price | 14,20,000 |
| Long-Term Capital Gains | 34,98,609 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 33,73,609 |
| Tax paid on LTCG | 4,21,701 |
| Maturity value after tax | 44,96,908 |
Both alternatives mirror the cash flow patterns of the Shriram Life Premier Assured Benefit Plan while offering better returns. Additionally, if withdrawals are deferred, returns can be even higher.
When planning for life goals, separating life insurance from investments proves to be a more effective approach, as Shriram Life Premier Assured Benefit Plan provides flexibility, better returns, and a clear focus on financial objectives compared to money-back plans.
Final Verdict on Shriram Life Premier Assured Benefit Plan
The Shriram Life Premier Assured Benefit Plan provides regular income or maturity benefits in instalments during the final four years of the policy term, along with life cover throughout the policy duration.
While the cash payouts are guaranteed, they may not align with actual financial needs and could encourage discretionary spending.
An evaluation of the returns reveals that the Shriram Life Premier Assured Benefit Plan delivers subpar performance, with returns falling below the inflation rate. Its lack of flexibility in payout options and low returns make it an unattractive choice for investors and it also has a high agent commission.
Additionally, the sum assured under this plan is inadequate to meet a family’s essential financial requirements. Pure-term life insurance policies offer significantly higher coverage at much lower premiums.
Traditional plans, like this one, tend to provide insufficient life coverage and rigid payout structures, limiting their effectiveness in addressing real financial goals.
A better approach is to separate investments from life insurance. By doing so, you can build a diversified investment portfolio aligned with your risk tolerance, life objectives, and time horizon.
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