ICICI Pru Easy Retirement Plan, a unit linked pension plan with life insuranceLife Insurance companies offer pensions through what are known as ULPPs or Unit Linked Pension Plans. These plans are very similar to ULIPs (Unit Linked Insurance Plans) but do not have a life cover. Instead, ULPPs offer you a pension at the completion of the ULPP term.

ICICI Pru Easy Retirement is one such ULPP. You can sign up for a pension either through a single premium or through regular premiums. There is a lock-in of five years. If you either surrender the plan or stop paying premiums in this time period, your money is moved to the Pension Discontinued Policy Fund after deducting discontinuance charges, where it earns 4% per year. It remains in the fund for a period of five years and is thereafter paid out to you.

How your money is invested

You can either allocate your money to the Easy Retirement Balanced Fund or the Easy Retirement Secure Fund. The balanced fund can invest 0-50% of its assets in equities and the rest in debt and money market instruments. The secure fund must entirely be invested in debt and money market instruments. You can also switch your money between the two funds.

The Easy Retirement Balanced Fund delivered a return of 8.52% CAGR in the four years ending on 31st May 2018. The fund commenced in September 2013. The single premium variant of this fund returned 8.98%. The secure fund returned 8.01% over the same period.

How long it’s invested for

You can choose terms of 10, 15, 20, 25 or 30 years for both single and regular premiums. In case of regular premiums, you can choose a premium payment term of five years, 10 years or equal to the policy term itself. Your money is locked in for the first five years. Thereafter you will get the fund value, even if you terminate before maturity.

On maturity or termination after five years you can ‘commute’ up to one-third of the fund value. Commute means take as a lump sum. This commuted amount will also be tax-free. The balance two-thirds must be used to buy an annuity from ICICI Prudential Life Insurance. The annuity will be taxable.

Any guarantees?

At maturity, you will get at least 101% of the sum of all the premiums that you have invested. In other words, you will get your money back (100%) and a little more (1%). Note that this guarantee is at maturity and not on premature surrender or termination. Also, note that the value of money decreases with inflation and your money back at maturity is likely to have a lower real value.

Any bonuses?  

For the single premium option, you get a loyalty bonus at the end of the 6th year and at the completion of every subsequent year equal to 0.25% of the fund NAV. This effectively reduces the fund management charge from 1.35% to 1.1%. For both options, you get a booster of 2% of the fund NAV at the completion of the 10th year and at the completion of every 5 years thereafter.


Premium Allocation Charge: Nil for the single premium. For the regular premium, it ranges from 2-3% for premiums less than Rs 10 lakh for the first three years.

Policy Administration Charge: 0.12% to 1.68% for single premium less than Rs 10 lakh. 0.6-3% per annum for multiple premiums.

Fund Management Charge: 1.35% per annum. Additional charge for investment guarantee of 0.1% to 0.2% for the secure fund and balanced fund respectively for the single premium. Additional charge for investment guarantee of 0.1% to 0.5% for the secure fund and balanced fund respectively for multiple premiums.  

What happens if you die during the policy term

Your nominee gets the death benefit which is the higher of the fund value or 105% of all the premiums paid. In other words, he/she gets your money back (100%) and a little more (5%).

RupeeIQ Take

The NPS offers a much lower cost pension than ULPPs. It also allows you to withdraw 40% of your maturity amount tax-free instead of 33% with ULPPs and allows you a lot more choice in terms of fund managers and funds. However, if you are set on ULPPs you can consider the ICICI Pru Easy Retirement Plan. Within this particular plan, charges are much lower on the single premium option.

Neil Borate

Neil Borate is Deputy Editor, RupeeIQ. He can be contacted at neil@rupeeiq.com.