DLF Pramerica Sahaj Suraksha

Recommendation

Do not invest in Sahaj Suraksha

Review of Sahaj Suraksha

Sahaj Suraksha from DLF Pramerica Life Insurance is a conventional endowment plan with maturity at the age of 75 years. It combines insurance and savings goals in one plan.

Features of Sahaj Suraksha

Entry age: 18 years to 60 years

Policy term: 75 years of age

Minimum basic sum assured: Rs 1 lakh

Maximum maturity sum assured: No limit (depends on insurance underwriter's valuation)

Minimum premium: Rs 6,144

Premium paying term: 15 years or 20 years

Benefits in Sahaj Suraksha

Maturity benefits include-

Basic sum assured chosen, Accrued reversionary bonuses and Final bonus, if any.

Reversionary bonuses are declared as a percentage of basic sum assured. Though this is not guaranteed usually it is paid regularly. But you cannot expect it to be much. From past experience endowment policies manage to pay out 5-6% annual returns after accounting for all charges involved.

Final bonus may or may not be paid depending on profits made in that particular year.

Death benefit is the maximum of 3 parameters-

  • Basic sum assured
  • 11*annual premium
  • (70- entry age)*0.5* annual premium; if you are 45 years or older then (70- entry age)*0.25* annual premium

Basic calculations will tell you that only those between 18 years and 38 years would be eligible for benefit exceeding basic sum assured. For others the sum assured will not exceed the other parameters.

Here is an illustration of death benefit with minimum sum assured

Age: 25 years

Premium: Rs 6,144

Basic sum assured: Rs 1,00,000

Applicable sum assured: Rs 1,38,200 (which is 45*0.5*6144)

Better alternative

Take a term policy for insurance cover. You will get sum assured of 500 times the annual premium compared to maximum 17 times in Sahaj Suraksha. If you buy an online term policy you are still the better- there sum assured is about 1000 times annual premium!

What about the savings part? Go for core investment products like mutual funds or else simply FDs. You earn much more in an FD than from endowment policies like this one. Also for periods as long as 15 and 20 years savings should be channelized into equity in order for them to grow above inflation. So you can choose one of the best equity mutual funds or balanced funds, depending on your investment goal, time horizon etc.

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