Compare ICICI Prudential Cash Advantage Plan

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ICICI Prudential Cash Advantage Plan

ICICI Prudential Cash Advantage Plan is a traditional savings plan which provides monthly incomes after the premium payment term is over. The plan, thus, provides easy liquidity and availability of funds even during the plan tenure. It is a participating plan which means that bonuses are added to the plan benefits which increase the corpus payable.

Key features of the plan

  • Guaranteed monthly payouts are provided under the plan for 10 years after the completion of the premium paying term.
  • Limited premiums are paid under the plan.
  • On maturity, a Guaranteed Maturity Benefit is paid.
  • A full death benefit is paid in case of death irrespective of the monthly cash benefits already received.
  • The plan allows the monthly benefits to be taken annually too.
  • Reversionary bonus, interim bonus and terminal bonus enhance the corpus payable under the plan.
  • Loans are also available under the plan for financial emergencies.

How does the plan work?

Step 1 – the policyholder chooses the Sum Assured, the premium amount, the premium paying term and frequency and the cash benefit mode. Based on the insured’s age and the above factors, the Guaranteed Cash Benefit and the Guaranteed Maturity Benefit are calculated.

Step 2- after the premium paying term is over Guaranteed Cash Benefit is paid monthly or annually as chosen by the policyholder till the term is over. On maturity, the Guaranteed Maturity Benefit is paid with accrued bonuses.

Step 3 – if the insured dies during the plan tenure, the death benefit is paid irrespective of the Guaranteed Cash Benefits already paid.

Example

Karim, a 35 year old male, buys the plan with a premium of Rs.50, 000. The tern selected is 15 years and premiums are paid for 5 years.

Option 1 – After the premium paying term is over Karim gets 1% of the Guaranteed Maturity Benefit for the remaining term of 10 years. On maturity, the Guaranteed Maturity Benefit is paid with accrued bonuses.

Option 2 – Karim dies in the 10th year of the policy. Irrespective of the cash benefits received for 5 years, the death benefit is paid along with bonuses.

Plan benefits

  • Death benefit – if the life insured dies during the term of the plan, and all premiums have been paid, the death benefit is paid. The death benefit is higher of the Sum Assured or Guaranteed Maturity Benefit or 105% of all premiums paid till death. The accrued bonuses are also paid on death.
  • Maturity Benefit – when the premium paying term is over, Guaranteed Cash Benefit is paid either monthly or annually for 10 years. On plan maturity, the Maturity Benefit is paid which is higher of Guaranteed Maturity Benefit with accrued bonuses or 100.1% of total premiums paid after deducting the cash benefits already received.
  • Guaranteed Cash Benefit– after the completion of the premium payment term, Guaranteed Cash Benefits are paid monthly or annually for 10 years. Guaranteed Cash Benefit is calculated as a percentage of the Guaranteed Maturity Benefit depending on the mode of receiving cash benefits. If benefits are received monthly, 1% of the Guaranteed Maturity Benefit is paid every month. If the mode is annual, 11.5% of the Guaranteed Maturity Benefit is paid every year.
  • Bonus – reversionary bonuses are added to the plan every year if due premiums are paid every year. The rate of bonus depends on profit experience of the company in a year and bonuses are non-guaranteed. On maturity or earlier death during the plan term, an interim bonus might be paid. Similarly, a terminal bonus might also be paid on maturity or pre-mature death.
  • Loan – up to 80% of the acquired Surrender Value can be availed as loan under the policy.

Eligibility

  Minimum Maximum
Age at entry (in completed years) Policy term 15 years – 3 years
Policy term 17 years – 1 year
Policy term 20 years – 0 years
60 years
Age at maturity (in completed years) 18 years 80 years
Term of the plan 15,17 or 20 years
Premium paying options Limited pay
Premium Paying term 5,7,10 years
Premium amount Policy term 15 years – Rs.30,000
Policy term 17 years – Rs.18,000
Policy term 20 years – Rs.12,000
No limit
Guaranteed Maturity Benefit Policy term 15 years – Rs.74,451
Policy term 17 years – Rs.65,364
Policy term 20 years – Rs.63,881
No limit
Sum Assured on Death Age less than 45 years – 10 times the annual premium
Age 45-54 years – 7 or 10 times the annual premium
Age more than 54 years – 7 times the annual premium

What is not covered in the policy?

  • In case of suicide committed within 12 months of inception, 80% of the premiums paid are refunded.
  • If suicide is committed within 12 months of revival, higher of 80% of the premiums paid or the surrender value under the plan is paid.

Premium Illustration

Below is a sample illustration showing the Guaranteed Cash Benefit, Guaranteed Maturity Benefit and Sum Assured under the plan for various combinations of premium amount and policy term. The premium payment term is 10 years less than the plan term.  

ICICI-Prudential-Cash-Advantage-Plan

FAQs

What are the premium paying frequencies?

The premium paying frequencies are annual, half-yearly and monthly.

What is the minimum Guaranteed Maturity Benefit?

The minimum Guaranteed Maturity Benefit is 100.1% of the total premiums paid during the plan term. However, any extra premium paid would be deducted from the total premium amount for computing the minimum Guaranteed Maturity Benefit.

What is the grace period of the loan?

The grace period is 15 days if monthly premium is paid otherwise the period is 30 days.

What are the types of bonus payable by the plan?

The plan might pay three types of bonuses. These are reversionary bonuses added every year and interim bonus and terminal bonus added on plan maturity or on earlier death during the plan term. Bonuses are added to a policy in which due premiums are regularly paid.

When does the plan acquire a Surrender Value?

If the premium payment term is 5 years or 7 years, the plan acquires a Surrender Value only if the first 2 years’ premiums have been paid. However, if the plan tenure is 10 years, Surrender Value is available if premiums for the first 3 years have been paid.


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