Compare ICICI Prudential Wealth Builder II Plan

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ICICI Prudential Wealth Builder II Plan

As the name suggests, Wealth Builder II is a wealth maximizing unit linked plan offered by ICICI Prudential Life Insurance Company. The plan offers dual investment strategies. The policyholder can choose a strategy for his funds to be managed by the company or he can manage his investments himself. There are three choices of premium payments – single, regular or limited. Loyalty benefits are also added to the plan and the policyholder can also choose the level of protection as per his requirement.

Key features of the plan

  • The plan has two investment portfolio strategies of Fixed Portfolio Strategy and LifeCycle based Portfolio Strategy. The former allows the policyholder the freedom to manage his own investments while the latter manages the investments automatically in a pre-defined proportion.
  • Premiums can be paid once, for the entire plan tenure or for a limited tenure.
  • Loyalty Additions, additional Loyalty Additions and Wealth Boosters are also added to the plan for an increased Fund Value.
  • 7 funds are available for investment in the fixed portfolio strategy
  • An additional Unit Linked Accidental Death Rider is available with the plan.

How does the plan work?

Step 1 – the policyholder chooses the premium amount, plan term and the premium paying term. The minimum and maximum Sum Assured is then calculated using the age of the insured and the plan term. The policyholder can choose any Sum Assured from the minimum and maximum range.

Step 2 – the policyholder also chooses the investment strategy. There are 2 strategies which are as follows:

  • Fixed Portfolio Strategy – under this strategy, the policyholder can choose to invest the allocated premium in any of the available fund options. There are seven funds to choose from which are – Maximizer V, Multi Cap Growth Fund, Opportunities Fund, Blue chip Fund, Multi Cap Balanced Fund, Income Fund and Money Market Fund. The policyholder can also choose Automatic Transfer Strategy (ATS) to invest partly or fully in Income Fund or Money Market Fund. Then the money is automatically transferred in monthly instalments to any of the other equity-oriented funds.
  • Lifecycle Based Portfolio Strategy – this strategy works on the ‘Years to Maturity’ principle. Initially, the allocated premium is invested in equity oriented funds in a pre-defined ratio depending on the age band of the insured. As the plan approaches maturity, the funds are reallocated to debt-oriented funds in a pre-defined proportion when the insured’s age band changes. Under this strategy, the funds are reallocated from equity exposure to debt exposure to protect returns generated from market volatility.

Step 3 – the policyholder can make partial withdrawals or switch his investments if Fixed Portfolio Strategy is chosen.

Step 4 – top-ups can be done to increase the investment in a chosen fund.

Step 5- in case of death during the plan term, the death benefit is paid.

Step 6 – if the insured survives the plan tenure, the maturity benefit is paid.

Example

Rahim, a 40-year old salried employee, buys Wealth Builder II with a premium of Rs.50, 000 and a Sum Assured of Rs.5 lakhs. He pays regular premiums for his policies.

Option 1 – He opts for Fixed Portfolio Strategy and allocates 100% of the premiums in Blue Chip Fund. In case of death during the tenure, the death benefit would be paid to the nominee which would be the Sum Assured and the Fund Value since Rahim was below 50 years of age when he bought the policy. If, however, Rahim survives the plan tenure, the Fund Value is paid on maturity which Rahim can take in lump sum or instalments over 5 years.

Option 2 – He chooses Life cycle Based Portfolio Strategy. The allocated premium is invested in Multi-Cap Growth Fund and Income Fund in the ratio 65%: 35% depending on Rahim’s age. Every time Rahim’s age band changes the fund moves from equity-oriented funds to Income Fund. On death, the Sum Assured plus Fund Value is paid. If, however, Rahim survives the plan tenure, the Fund Value is paid on maturity which Rahim can take in lump sum or instalments over 5 years.

Rahim can make partial withdrawals, switch between funds and also pay top-up premiums during the plan tenure.

Plan benefits

  • Death benefit – if the insured dies during the term of the plan, the death benefit paid depends on the premium paying mode and is as follows:
    • For single pay plans the death benefit is higher of the Sum Assured including any top-up Sum Assured, Fund Value including any top-up Fund Value or Minimum Death Benefit which is 105% of premiums paid till death.
    • For limited and regular pay plans the death benefit is Sum Assured including any top-up Sum Assured plus Fund Value including any top-up Fund Value or Minimum Death Benefit whichever is higher if the entry age is below 50 years. if the entry age is 50 years and above, death benefit is higher of the Sum Assured including any top-up Sum Assured, Fund Value including any top-up Fund Value or Minimum Death Benefit.
    • The Minimum Death Benefit is 105% of premiums paid till death.

  • Maturity Benefit – when the plan matures, the available Fund Value including top-up Fund Value is paid to the policyholder. The policyholder can take the maturity benefit in lump sum or in instalments in 5 years through Settlement Option.
  • Loyalty Additions – from the end of the 6th policy year loyalty additions @0.25% of the Fund Value are added every year of the plan. Moreover, an additional Loyalty Addition would be added @ 0.25% of the Fund Value.
  • Wealth Boosters – wealth boosters are added to the Fund Value from the 10th policy year and every 5 years thereafter. The rate of the booster is 3.25% of the Fund Value if regular premiums are paid and 1.5% of the Fund Value for single premium plans.
  • Partial withdrawals – the policyholder can make four free partial withdrawals after the first 5 years. The maximum amount of withdrawal allowed is Rs.20% of the Fund Value in one policy year.
  • Switching –the policyholder can change the choice of funds and reallocate the Fund Value among different funds through switching in case of Fixed Portfolio Strategy. The minimum amount of switching is Rs.2000. Moreover, the policyholder can also change his investment strategy portfolio from one to another.
  • Premium redirection – If the policyholder wants, he can choose to redirect future premiums to another fund different from the one in which the premium is currently being allocated to if the money is invested in Fixed Portfolio Strategy.
  • Top-up – additional premiums can be invested in the plan through top-up facility. The minimum top-up is Rs.2000 and it can be done anytime except in the last 5 policy years.

Eligibility

  Minimum Maximum
Age at entry (in completed years) 0 year Single premium – 69 years
Limited premium – 55 years
Regular premium – 65 years
Age at maturity (in completed years) 18 years Single premium – 79 years
Limited premium –69 years
Regular premium – 75 years
Term of the plan Regular or limited premium:
Ages 0-39 years – 10,15,20,25 years
Ages 40-54 years – 10,15 years
Ages 55 years and above – 10 years
Single premium – 10 years
 
Premium paying options Regular pay, limited pay or Single Pay  
Premium Paying term Regular premium - Equal to plan term
Single premium – once
Limited premium – 5,7,10 years
 
Annual premium amount Regular or limited premiums:
Rs.24,000
Single premium:
Rs.48,000
No limit
Sum Assured Regular or Limited Premium:
If age is below 45 years – higher of 10 times the annual premium or 0.5*term*annual premium
If age is 45 years and above – higher of 7 times the annual premium or 0.25*term*annual premium
Single Premium – 1.25 times the single premium
Regular Premium:
As per age related multiples
Single premium:
If age is up to 33 years – 10 times the single premium
If age is 34 years and above – 1.25 times the single premium

What is not covered in the policy?

In case of suicide committed within 12 months of inception or revival of the plan, the available Fund Value and any top-up premium Fund Value is paid.

FAQs

When are funds rebalanced in LifeCycle Based Portfolio Strategy?

Funds are rebalanced every quarter.

When is premium redirection available?

Premium redirection is available only if Fixed Portfolio Strategy is selected by the policyholder

Can top-ups be withdrawn?

Withdrawal from top-ups is allowed only after a period of 5 years from the date when the top-up was made.

What features can be altered during the plan tenure?

The Sum Insured, policy term and premium paying term can be decreased or increased under the plan.

When is surrender value available?

Surrender Value is available only after the lock-in period of 5 years.


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