Aviva i-Shield Online return of premium term plan – Review

Aviva i-shield

Aviva Life Insurance has launched an online term plan with return of premium. Return of premium term Insurance products, as the name suggests, gives back a certain return on the premium paid if the policyholder survives the policy term. Name of plan is Aviva i-Shield. Aviva i-Shield, provides life cover with a provision of return of 110% of paid premium if the policyholder survives the policy term.

Key Features:-

  • 110% of the premiums paid back as survival benefits, guaranteed
  • Premium rebate on choosing Sum Assured of Rs. 20 Lacs and above.
  • Free Medical examination at inception of the policy
  • Quick and hassle free buying through internet

Eligibility:-

Entry   Age (last birthday) 18   years – 55 years
Maximum   Maturity Age (last birthday) 65   years
Policy   Terms 10   years to 25 years
Premium   Payment Term (PPT) Equal   to Policy Term
Allowed   Premium Payment Frequencies and Modal Factor Yearly:1.0000Half   Yearly: 0.5108Monthly:   0.0871
Sum   Assured Allowed Rs.   15 lakhs to Rs. 5 crores (in multiples of Rs.25000), subject to underwriting

Benefits:-

Death Benefit: In an unfortunate event of your death (if you are the Life Insured) within the policy term chosen by you, your nominee will receive an assured amount. The assured amount depends upon the year of death.

Policy   Year When Life Insured Dies Assured   Death Benefit
1st   – 10th 100%   of Sum Assured
11th   – 20th 110%   of Sum Assured
21st   – 25th 120%   of Sum Assured

 

The policy will terminate after the payment of death benefit.

Maturity Benefit: If you survive till maturity and pay all due regular premiums, you will receive 110% of all premiums paid, excluding taxes and extra premium, if any.

Premium:-

For a person with age of 25 years the premium for Aviva I-Shield works to around Rs 16400 for a 50 lakh cover, 20 year.

For a person with age of 35 years the premium for Aviva I-Shield works to around Rs 26150 for a 50 lakh cover, 20 year.

Our Opinion:-

This plan is nothing but option to combine investment with insurance. Which one should avoid.

If risk cover is only objective one should purchase term plan, where once can find 50 lac cover in approximate Rs.5000.

Remember these plans come at an additional premium cost of as much as five times of that of any regular term plan.

At the end of term company will return premium paid by you. The insurance company would invest your premium amount in low-yielding instruments such as government securities, bond, fix deposit and other approved securities to return the premium amount at maturity

So, if insurance company can invest your money in low risk component why you can’t.

I advise instead of buying this plan you can park surplus funds in high-growth instruments such as equity-linked savings schemes (ELSS) or PPF, ELSS of FD which can earn you better returns along with tax benefit.

Article by Raviraj

Hi, I am Raviraj. I am passionate about money matters and finance. I have 10 years of rich experience in the field of financial planning, Investments & Insurance. I have written 850+ article on this blog. If you like my efforts kindly subscribe to this blog and also let your friends know about this website by sharing.

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