About ICICI Prudential Lifetime Classic Plan

The ICICI Prudential Lifetime Classic plan is a non-participating unit-linked insurance plan (ULIP). The plan ideally works as a savings-cum-protection plan. The plan provides you with two unique features – one being an investment option in nine different funds that suit your risk-to-return profile and the second being a choice between four different portfolio strategies. The plan provides maturity benefits + death benefits + loyalty additions + wealth boosters along with many other benefits.

Let’s understand this plan in brief before getting into its details.

How Does the Plan Work?

Firstly, the individual decides the premium amount and premium paying term (PPT). Then, as per their needs, the sum assured is decided. Next, the individual has to choose any one portfolios strategy out of the four available.

Let’s understand the benefits offered with this plan:

• Guaranteed Maturity Benefits: On survival of the life insured till the end of the policy term, the total fund value, including the top-up fund value, is payable at maturity. You can receive this benefit as a lump sum or as periodic installments by using the settlement option.

• Death Benefits: In case of the unexpected death of the insured individual, the legal heir or the nominee will receive the following:
  • In case of single-premium policies: A or B or C, whichever is the highest
  • In case of limited pay and regular pay policies (for age entry less than 50): (A+B) or C, whichever is the highest
  • In case of limited pay and regular pay policies (for age entry equal to or more than 50): A or B or C, whichever is the highest

Here,

A = Sum assured, including top-up sum assured, if any (reduced by applicable partial withdrawals, if any)

       B = Fund value, including top-up fund value, if any

  C= Minimum death benefit, which is 105% of the total premiums paid including top-up premiums, if any

• Loyalty Additions: The following are the loyalty additions that come with this plan:

• For single pay policies with a policy term of 5 years, a loyalty addition of 0.25% of the average of daily fund values, including top-up fund value, if any, in that same policy year, will be payable at the end of the fifth policy year.
• Each loyalty addition will be a percentage of the average of daily fund values including top-up fund value, if any, in that same policy year as mentioned in the following table:

• Wealth Boosters: Here are some more details about the wealth boosters that come with this plan:

• Wealth boosters will be a percentage of the average fund value including the top-up fund value, if any, in the same policy year. The aforementioned table will guide the reader further.
• Wealth boosters will be a percentage of the average fund value including top-up fund value, if any, on the last business day of the last eight policy quarters.

Why Should I Buy This Plan?

Along with the benefits mentioned already, here are some more reasons to opt for the ICICI Prudential Lifetime Classic plan:

i) Tax Benefits: Premiums paid under the plan would be exempt from tax under Section 80(C) and the received benefits will be treated as per Section 10(10D).

ii) Free-look Period: The individual is advised to go through the policy thoroughly. If s/he finds any objections to the terms and conditions of the policy, s/he can cancel the policy within 15 days (free-look period) by giving a signed written notice to the insurance company stating the reasons for objection of the policy along with the original policy document. Only then will the individual will be entitled to a refund of the premium paid, excluding charges like stamp duty charges.

iii) Non-Negative Claw-Back Additions: After the policy completes 5 years, non-negative claw-back additions are applicable in order to comply with the reduction yield.

iv) Flexibility: This plan provides flexibility so that you can control and make changes to your investment with ease.

• Fund switch: If you choose the fixed portfolio strategy, you can switch units from one fund to another. Four switches are free in a policy year. The minimum switch amount is INR 2,000.
• Withdrawals as per your needs: You can make unlimited number of partial withdrawals from the 6^th year onwards, as long as the total amount you withdraw in a year does not exceed 20% of the fund value in a policy year. Partial withdrawals are free of cost.

v) Change in Portfolio Strategy: You can change your portfolio strategy up to four times in a policy year free of cost.

Riders

The Accidental Death Benefit rider can be opted for with this plan, on payment of additional premium.

Who Should Buy This Plan?

The minimum entry age for this plan is 0 years. The maximum entry age for the single-premium option is 75 years. For the limited pay / regular pay option, the maximum entry age is 65 years. The plan is a perfect combo of protection and savings and proves to be of great support in fulfilling your goals. It gives you the opportunity to strengthen your financial portfolio.