Insurance Plans 198 views May 19, 2020

Every individual doesn’t plan for their retirement and thus they have to face some financial difficulty in their future. So, if you are one of them, then it is high time to make an investment and accumulate some funds for your future. You can take a look at the ABSLI Empower Pension SP Plan in which you’ll only have to pay a single premium. The term SP in the Plan’s name stands for Single Pay. It simply means that you will have to invest the amount of premium only once and a corpus will be generated after the accumulation period. You can use the return in the future after your retirement. So, let’s explore all other details of this plan.

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Key Features of Empower Pension Single Pay Policy

  1. You will get a guaranteed addition in this plan.
  2. The minimum age for taking this plan is 25 years.
  3. The Minimum amount of the Single Pay premium is 1 Lac.
  4. Enjoy the vesting benefits and death benefits in this plan.
  5. Get deductions under Section 80C of the Income Tax Act 1961.

Benefits of the ABSLI Empower Pension SP Plan

Before taking this plan, you must explore all the benefits of this policy and see how they will benefit you once you retire. You will only have to pay a Single Premium in this policy and the return will be given to after the expiry of the policy term.

Guaranteed Additions

  1. After the 6th policy anniversary years and every year thereafter get a Guaranteed Addition of 0.25% of the Average Policy fund Value in the last 12 months.
  2. After the 11th policy anniversary years and every year thereafter get a Guaranteed Addition of 0.35% of the Average Policy fund Value in the last 12 months.
  3. On the 16th policy anniversary years and every year thereafter get a Guaranteed Addition of 0.35% of the Average Policy fund Value in the last 12 months.

Vesting Benefits

You will get the highest of the following as the vesting benefits on the vesting date:-

  1. Guaranteed Vested Benefits
  2. The Policy Fund Value

The vesting date and the risk profile you have chosen will affect the amount of the vesting benefits in the ABLSI Empower Pension SP Plan.

You can see the percentage of a Single Premium paid as the Guaranteed vesting benefit in the following table:-

Years to Vesting Guaranteed Vesting Benefits
ConservativeModerateAggressive
5 Years105%--
6 Years to 10 Years112%106%101%
11 Years to 15 Years119%110%102%
16 Years to 20 Years126%114%103%
21 Years to 25 Years133%118%104%
25 Years to 30 Years140%122%105%

You will have to choose the conservative profile for the first five years.
On the Date of vesting you can choose any option from the following:-

  1. Purchase Annuity or Deferred Annuity at the prevailing rate from Aditya Birla Sun Life Insurance.
  2. Commute up to 60% and then Purchase between Annuity and Deferred Annuity at the prevailing rate from ABSLI.
  3. Either Purchase Annuity or Deferred Annuity at the prevailing rate from ABSLI to the extent of the percentage that is currently 50% of the entire amount of the vesting benefits.

Death Benefits

If in case the Policy Holder Dies then the nominee will receive the highest of the following:-

  1. Guaranteed Death Benefits
  2. Fund Value of the policy as on the date of the death.

Death benefits will be always equal to 105% of all the basic premiums.

Surrender Benefits

You can even surrender the policy and take the funds as calculated by the company in case of an emergency. The ABSLI Empower Pension Single Pay plan will be discontinued once it is surrendered.

ABSLI Empower Pension SP Plan Investment Options

In this pension plan, you have two options for investment. You can invest the amount of your single pay premium in any of the investment options.

Option 1- Assured Option

In this option, the vesting date and the risk profile will help you to manage your portfolio. Your amount of the Single Paid Premium will be invested in the Maximiser Guaranteed and Income Advantage Guaranteed Funds. The Income Advantage Guaranteed Funds are a type of debt funds and the Maximiser Guaranteed Funds are a type of Equity Fund. The company will switch the amount from one fund to another regularly depending upon the risk and it will administer and manage your portfolio.

You can see the percentage of the premium that will be invested in the Maximiser Guaranteed Funds and the Income Advantage Funds depending upon the risk you have chosen.

Years to Vesting   Risk Profiles
ConservativeModerateAggressive
FundsMFIAFMFIAFMFIAF
26 Years to 30 Years50%50%75%25%100%0%
21 Years to 25 Years40%60%60%40%80%20%
16 Years to 20 Years30%70%45%55%60%40%
11 Years to 15 Years20%80%30%70%40%60%
6 Years to 10 Years10%90%15%85%20%80%
5 Years0%100%0%100%0%100%

MF Stands for Maximiser Funds
IAF Stands for Income Advantage Funds

Option 2- Self-Managed Option

In this option of the ABSLI Empower Pension SP Plan, you can invest the amount of the Single Premium in 16 different Segregated funds. You will have to manage your portfolio by yourself and have the full power to switch from one fund to another. The 16 segregated funds will consist of 100% debt options and 100% equity options. So you have multiple choices for making the investment in these funds and maximize your return.

About the ABSLI Empower Pension Single Pay Plan

ParticularsDetails
Minimum Age of Entry25 Years
Maximum Age of Entry70 Years
Accumulation Period5 Years to 30 Years up to a maximum vesting age of 80 years
Premium Paying TermSingle Pay
Minimum Single Pay Premium1 Lac Per Annum
Maximum Single Pay PremiumNo Limit

Charges of the ABLSI Empower Pension Single Pay Policy

  1. 0.25% with a maximum of up to 0.50% as the Investment Guarantee Charge.
  2. Premium Allocation Charge of 3% once it is received by the company.
  3. 1% to 1.35% as the Fund Management Charge.
  4. 50 to 500 as the Switching of Funds Charges.
  5. 20 per month for the first 5 years and it will increase to 25 from the 6th years and inflate by 5% per annum with a maximum of 6000 as the Policy Administration Charge.

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