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Are 300% Returns Possible?

The ICICI Prudential Super Life Plan promises 300 per cent returns. But can it justify such claims?

I am planning to invest in ICICI Prudential Pinnacle Super Life Insurance policy. I am being told that this plan will return at least 300 per cent. I wish to understand if this is possible before I invest. -Santhosh Kumar

ICICI Prudential Super Life Plan is a unit-linked policy with a five year lock-in and a fixed term to maturity of 10 years where you can pay a one-time premium or through five annual payments. Suppose you consider opting for a regular annual premium, a 30-year-old male will be entitled to a minimum life cover of Rs 10 lakh, up to maximum of Rs 65 lakh, by paying an annual premium of Rs 1 lakh for the next five years.

The first year charges on this policy are about 11.50 per cent, which continue for the next four years on a reducing scale. However, the mortality charge, which is the cost of covering your life against risks, increases with each passing year, because it is linked to your age. The complexity with this product does not end here. This policy promises to pay out the highest NAV achieved by its funds within seven years of its launch. This highest NAV is available only to policyholders who stay invested through maturity without opting for any partial withdrawal, surrender or even death. Being a market-linked plan, there is no way it can guarantee you any returns. There is no way this policy will earn you 300 per cent returns, which you should be aware of.
We strongly believe that life insurance and investments should not be mixed and it will be in your best interest to separate the two.

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