There is no escape from incurring losses from a unit linked pension product, but it is better to curb your losses now
17-Sep-2015 •Research Desk
I purchased ICICI Pru Lifestage Pension Ad (Dynamic P/E fund) (premium is ₹36,000) on 26th May 2010. I have completed 5 years and am planning to withdraw the amount as it is giving me very poor returns. I have been wrongly sold this plan by the agent. What do you suggest.
- Harikiran Mugi
Your policy is a deferred unit linked pension product. The policy claims zero premium allocation charges. However, it has kept its policy administration charge as high as approx 13.1% p.a. Apart from this, it deducts fund management charge which in your case is 1.35% p.a.
You have already borne major expenses. However, we recommend you to surrender the policy. This is because the initial loss due to expenses will generate relatively lower returns in future. If you surrender now, you will receive fund value as surrender value which will be added to your income and taxed as per your tax slab and you will have to pay back the tax exemptions you would have availed on the premiums paid until now. There is no escape from incurring losses now. It is better to curb your losses here itself and invest wisely in future.