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SBI Life Smart Elite ULIP Review

SBI Life Smart Elite is another unit linked insurance plan offered by SBI Life insurance company. This is one more ULIP which claims to build a long term wealth for you.

Let us review this plan.

Key Features -

•Maximum value addition through excellent allocation rates.

•Pay premiums only for a limited term of 5, 8 or 10 years or a Single Payment, as per your convenience and enjoy benefits throughout the chosen policy term.

•No Premium Allocation Charges from 6th policy year onwards, thereby enhancing your fund value.

•Two protection options available: Gold Option & Platinum Option

•Invest in wide range of funds and manage them as per your convenience.

•Life Insurance coverage with minimum Sum Assured of 10 or 7 times of your Annual Premium (AP), based on your age.

•Switch and redirection facility, to pilot your investments.

•Option to increase/decrease your Sum Assured from 6th policy year onwards.

•Accidental Death and Accidental Total and Permanent Disability (Accidental TPD) benefit automatically comes to you as an integral part of the plan!

•Attractive Tax benefits under the Income Tax Act, 1961, subject to conditions.

Minimum age of entry is 18 years and maximum is 60 years.

The minimum annual premium is Rs.1.5 lakh (Annually), Rs.75,000 half-yearly, Rs.37,500 (Quarterly) and Rs.12,500 (Monthly). The policy term is 5 to 20 years.

The sum assured is 10 times the annual premium. Thus, if your annual premium is Rs.1.5. lakh (which is minimum) than your sum assured is Rs.15 lakhs.

My Opinion -

I personally don’t advise anyone to go for this plan because its the highly opaque insurance cum investment financial product. They have nowhere mentioned in their product brochure available on their website that exactly where they will invest your money?

I mean they will invest your money in equity, debt or both? This is very important to know because you are going to invest for more than 10 years of time horizon.

Suppose if we assume that the scheme invests in equity (Because its ULIP), than also it is very important to know that exactly in which types of stocks this scheme invest – large, mid or small cap scripts?

Another thing I don’t like about the scheme is that, which are the various charges associated with the plan? I mean how much will be premium allocation charges, mortality charges, fund management charges and various other charges?

Also the 10 times life cover than annual premium is also too low in comparison to the term insurance plans cover.

So,

Term Insurance + Equity Diversified Mutual Funds + PPF is still the best combination to build some long term serious wealth for you.

What if you have already invested in SBI Life Smart Elite Plan?

Exit.

Yes, Get out of this plan as early as possible no matter how much money you loss. And start SIP in 2-3 good equity diversified mutual funds for 10-15 years. And also buy an adequate life cover by buying pure term life insurance plan. But get out of this policy as soon as possible if you have already invested in it.