SBI Life – Saral Maha Anand ULIP Review

SBI Saral Maha Anand is another Unit linked insurance plan which claims to protect your life as well as save money and build wealth for the long term.

Let us review this plan in detail. I mean let us analyze that weather you should invest in this plan or not?

Key Features -

•No medical examination, Simple joining process

•Liquidity through Partial Withdrawals.

•Guaranteed Additions of up to 30% of one annual premium, for a 20 year policy term, subject to the Policy being in force till the maturity date.

•Option to avail additional rider benefit under SBI Life - Accidental Death Benefit Linked Rider.

•4 Fund options, to enjoy market related returns as per your risk appetite.

•Twin Benefit of Market linked returns & insurance cover.

The Minimum age of entry is 18 years and the maximum age of entry is 55 years. Policy term is 10, 15 and 20 years. Minimum premium is Rs.15,000 (Yearly), 9,500 (Half-yearly), 5500 (Quarterly) and Rs. 2000 (Monthly).

The Sum assured is 10 times the annual premium (AP) means for the annual premium of Rs.15,000 you will get the sum assured Rs.1.5 lakh.

My Opinion -

Term Insurance + Equity Diversified Mutual Funds (2-3) + PPF is the best financial planning solution.

No need to invest in this plan because of the following reasons.

- The amount of life cover it provides is a peanut size means for Rs.15,000 of annual premium, it will give you just Rs.1.5 lakh of life cover which is in comparison to the life cover provided by the term life insurance plans is a peanut size of life cover.

- They have nowhere mentioned in the policy brochure that in which type of stocks they will invest your money and in how much proportion means large, mid or small or mixed? This is really important to know as an investor. Because if your investment time horizon is more than 10 years than this makes a difference.

- They have nowhere mention the various charges associated with the policy means premium allocation charges, fund management charges…etc..

Thus, in my opinion, this is a highly opaque financial product and the investors should avoid this.

What is you have already invested in SBI Saral Maha Anand Plan?

Get out of it.

Because its not Saral (Simple), its not Maha (Big) and its not Anand (Joy) as it claims but you will surely cry after 15 years if you fail to build serious long term wealth.

Equity mutual funds are still the cheapest (Entry and Exit load is 0%) way to build the long term wealth and Term Insurance plans are still the best insurance products to get the adequate life cover. So go for it.