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A Good Insurance Plan

Monday, May 16, 2011
By Manoj Aswani

Adequate risk cover with a guaranteed return of premiums is a good benefit which a customer seeks from an insurance policy. ICICI Prudential Guaranteed Savings Insurance Plan (GSIP) is an endowment policy which guarantees the return of premiums paid at 5% per annum on death of the policy holder. It is a non unit-linked insurance plan which offers limited premium paying option. If the need is clearly a long-term savings policy then ICICI Prudential Guaranteed Savings plan GSIP) is a good insurance plan.  

Key Features

  • Guaranteed Death Benefit (GDB) which is total of all premiums paid at a compounded rate of 5% per annum
  • Limited premium payment term
  • Offers Guaranteed Maturity Benefit (GMP) which is total of all premiums paid and guaranteed regular additions accrued during the policy term along with Maturity Addition.
  • No medical tests required

Death Benefit: In case of death of the Life Insured, the nominee receives the total of all premiums paid till date compounded at the rate of 5% per annum. This is referred to as the Guaranteed Death Benefit (GDB)

Maturity Benefit: At the maturity of the policy, the insured will get his/her Sum Assured (total of all premiums paid). In addition to this, the policy will also offer Guaranteed Regular Additions and Maturity Addition which is calculated as a percentage of the sum assured. 

Income Tax Benefit: Premiums paid under life insurance policy are exempted from tax under Section 80 C and maturity proceeds are exempted from tax under Section 10 (10D)


                                             Minimum      Maximum
Sum Assured (in Rs.)     Premium x    Premium
                                                                    Paying Term
Policy Term (in years)           15            20
Premium Payment Term      7              10
(in years)   
Entry Age of Policyholder     0              60
Age at Maturity                       18            75
Single premium (in Rs.)                 NA

Payment modes          Yearly, Half-yearly or Monthly
Minimum Annual              18,000     12,000
Premium Amount


There are no riders are available with this plan

Discontinuance of Premiums

If premiums are stopped after 3 policy years, the policy acquires a Paid Up Value for a Reduced Sum Assured but the policy would be eligible for any future regular additions.
Paid up Sum     =    GMB x Total number
Assured (PUSA) paid         of premiums
        Total number of
        premiums payable
However, the policy can be revived within 2 years from the first unpaid premium by paying up the due premiums along with interest as calculated.

Surrender the policy
On discontinuing the policy you will be entitled to a surrender value which is the higher of the Guaranteed Surrender Value (GSV) and Non Guaranteed Surrender Value (NGSV).

The GSV    =    35% of Premiums paid -
        First Year’s Premium.
The NGSV    =     Present Value of Paid Up Sum
        Assured, discounted at the Gross
        Redemption Yield at the Review
        Date immediately preceding
        surrender, plus 2% per annum.

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