Equity Growth Fund
60–100% equity; growth-oriented large-cap focus
FMC 1.35%/yr
High risk
Calculators LIC plans ULIP
LIC Protection Plus · Plan 854
ULIP weighted toward protection over wealth-creation.
Unit-linked plan — LIC does not guarantee any maturity amount.
Your fund value at maturity depends entirely on the market performance of the fund(s) you choose.
Past NAV figures are not a predictor of future returns. The scenarios in the calculator below
use IRDAI's mandated 4% and 8% gross return assumptions, plus an illustrative 12% scenario.
What this plan does
LIC Protection Plus (Plan 854) is a ULIP that explicitly prioritises protection over wealth creation — the sum assured multiplier is higher than standard ULIPs (up to 10× for most ages), which means larger mortality charges are deducted from the fund every year. The trade-off is transparent: more insurance cover drag = slower fund growth. At the 8% gross return scenario, net XIRR is typically 0.3–0.8 percentage points lower than Index Plus at the same inputs — that gap is the cost of the extra life cover.
- Entry age
- 18–55 years
- Min premium
- ₹30,000/yr
- Policy term
- 10–20 years
- Lock-in
- 5 years (mandatory)
- FMC range
- 0.75%– 1.35% /yr
- Mortality charge
- Age-based, deducted monthly from units
Protection-weighted — higher SA multiplier means higher mortality charge drag on fund growth.
Fund options
Balanced Fund
Balanced equity-debt mix; dynamic allocation
FMC 1.25%/yr
Moderate risk
Bond Fund
G-Secs and corporate bonds; lower volatility
FMC 0.75%/yr
Low risk
Run the numbers
Three scenarios (4% / 8% / 12% gross return) shown side-by-side — the spread is the honest answer. All projections are net of charges.
Assumptions
- Age at entry
- 35 yrs
- Annual premium
- ₹30,000/yr
- Policy term
- 15 yrs
- Blended FMC
- 1.17% p.a.
- Fund allocation
- Equity Growth Fund 70%, Balanced Fund 0%, Bond Fund 30%
yrs
₹
Policy term
Fund allocation
Total: 100% ✓ Valid
Blended FMC: 1.17% p.a.
4% gross return/yr
Conservative
(IRDAI mandated low)
₹5,35,164
fund value at maturity
2.14% XIRR
8% gross return/yr
Moderate
(IRDAI mandated high)
₹7,48,173
fund value at maturity
6.13% XIRR
12% gross return/yr
Optimistic
(illustrative)
₹10,58,064
fund value at maturity
10.10% XIRR
Returns are net of all charges (PAC, FMC, mortality, admin). Gross return assumptions are per IRDAI illustration guidelines. Actual returns depend on fund performance.
Total premiums paid
₹4,50,000
₹30,000/yr × 15 yrs
Total charges (moderate scenario)
₹84,076
18.7% of total premiums
PAC total
₹3,900
Yr 1: 4% → Yr 5: 2.0%
FMC total (moderate)
₹60,376
At 1.17%/yr blended
Mortality charges total
₹10,800
Age 35→49; rises each year
Admin charges total
₹9,000
₹50/mo × 180 months
Death benefit (while in force)
₹3,00,000 + fund value
Sum assured (approx. 10× premium) paid to nominee in addition to the fund value at the time of death.
Fund Value Projection — 3 Scenarios
Dashed line: cumulative premiums paid (what you've put in). Solid lines: projected fund value net of all charges.
Cumulative premiums Conservative (4%) Moderate (8%) Optimistic (12%)
Year-by-year projection
| Yr | Premium | PAC | Net invested | Mortality | Admin | FMC | Fund val. 4% | Fund val. 8% | Fund val. 12% |
|---|---|---|---|---|---|---|---|---|---|
| 1 | ₹30,000 | ₹1,200 | ₹28,800 | ₹405 | ₹600 | ₹364 | ₹28,597 | ₹29,735 | ₹30,874 |
| 2 | ₹30,000 | ₹900 | ₹29,100 | ₹435 | ₹600 | ₹743 | ₹58,267 | ₹61,763 | ₹65,350 |
| 3 | ₹30,000 | ₹600 | ₹29,400 | ₹465 | ₹600 | ₹1,152 | ₹89,042 | ₹96,240 | ₹1,03,813 |
| 4 | ₹30,000 | ₹600 | ₹29,400 | ₹495 | ₹600 | ₹1,588 | ₹1,20,644 | ₹1,33,008 | ₹1,46,358 |
| 5 | ₹30,000 | ₹600 | ₹29,400 | ₹540 | ₹600 | ₹2,052 | ₹1,53,080 | ₹1,72,209 | ₹1,93,406 |
| 6 | ₹30,000 | ₹0 | ₹30,000 | ₹585 | ₹600 | ₹2,555 | ₹1,86,990 | ₹2,14,645 | ₹2,46,102 |
| 7 | ₹30,000 | ₹0 | ₹30,000 | ₹638 | ₹600 | ₹3,091 | ₹2,21,792 | ₹2,59,888 | ₹3,04,378 |
| 8 | ₹30,000 | ₹0 | ₹30,000 | ₹690 | ₹600 | ₹3,663 | ₹2,57,510 | ₹3,08,126 | ₹3,68,832 |
| 9 | ₹30,000 | ₹0 | ₹30,000 | ₹745 | ₹600 | ₹4,273 | ₹2,94,167 | ₹3,59,559 | ₹4,40,121 |
| 10 | ₹30,000 | ₹0 | ₹30,000 | ₹800 | ₹600 | ₹4,922 | ₹3,31,789 | ₹4,14,401 | ₹5,18,975 |
| 11 | ₹30,000 | ₹0 | ₹30,000 | ₹855 | ₹600 | ₹5,615 | ₹3,70,403 | ₹4,72,882 | ₹6,06,203 |
| 12 | ₹30,000 | ₹0 | ₹30,000 | ₹925 | ₹600 | ₹6,354 | ₹4,10,023 | ₹5,35,234 | ₹7,02,686 |
| 13 | ₹30,000 | ₹0 | ₹30,000 | ₹995 | ₹600 | ₹7,142 | ₹4,50,674 | ₹6,01,715 | ₹8,09,412 |
| 14 | ₹30,000 | ₹0 | ₹30,000 | ₹1,065 | ₹600 | ₹7,982 | ₹4,92,387 | ₹6,72,605 | ₹9,27,476 |
| 15 | ₹30,000 | ₹0 | ₹30,000 | ₹1,163 | ₹600 | ₹8,878 | ₹5,35,164 | ₹7,48,173 | ₹10,58,064 |
Rows 1–5 are shaded — these fall within the mandatory 5-year lock-in period. Fund value is not accessible until after year 5.
Where does your premium go? — charges breakdown
Default scenario: age 35, ₹30,000/yr premium, 15-year term. Numbers are computed SSR from the plan brochure — actual charges may vary with age, premium, and fund choice.
| Charge type | When applied | Total over term |
|---|---|---|
| Premium Allocation Charge (PAC) | Deducted upfront from each premium (years 1–5) | ₹3,900 |
| Fund Management Charge (FMC) | Deducted daily from NAV (approximated annually) | ₹60,376 |
| Mortality Charge | Monthly unit cancellation (age-based, rises each year) | ₹10,800 |
| Policy Admin Charge | Fixed ₹50/month, levied monthly | ₹9,000 |
| Total charges over 15 years | ₹84,076 (18.7% of total premiums) | |
Charge drag is the primary reason ULIP net XIRRs are lower than the fund's gross return. At 8% gross return, the moderate scenario above yields approximately 6.1% net XIRR after all charges — compare this with a direct index fund at the same gross return, which would deliver closer to 7.5–8%.
Lock-in, withdrawals & discontinuation
- Mandatory lock-in
- 5 years — premiums are locked in; no surrender value paid out before this.
- If you stop premiums before lock-in
- Policy enters LIC's Discontinued Policy Fund, earning 4% p.a.. Market participation resumes only after the 5-year lock-in expires; you may then revive or surrender.
- Partial withdrawal
- Allowed after 5-year lock-in. Up to 20% of fund value per year.
- Full surrender after lock-in
- Surrender value = fund value at the prevailing NAV on the surrender date. No surrender charges post lock-in for most plans.
Our take
Should you buy Protection Plus?
Protection Plus is the ULIP for the buyer who wants meaningful life cover from the market-linked product, not just the statutory minimum. The higher SA multiplier (up to 10×) means mortality charges are bigger and grow faster as the policyholder ages. The math is clear and honest: higher protection = higher mortality charge = lower fund value at maturity = lower XIRR. If you're buying this for wealth creation, there are better instruments. If you need ₹50L+ death cover and also want partial equity participation — perhaps because traditional term insurance is difficult to obtain — the hybrid makes sense. The three equity/balanced/bond fund options give enough flexibility to dial down market risk as you approach retirement. Like all ULIPs, the 5-year lock-in and front-loaded PAC (4%/3%/2% in years 1–5) apply.
- Higher sum assured multiplier means higher mortality charges — the primary cost of 'protection over wealth'. This drag compounds over long terms.
- Three fund options (equity, balanced, bond). No secured/money-market option — minimum risk exposure is a bond fund (G-Secs + corporate bonds), not cash.
- PAC schedule: 4%/3%/2%/2%/2% in years 1–5, nil from year 6. Front-load is significant but not as severe as SIIP's 8% year-1 charge.
- Best suited for buyers who are declined or rated by term insurers and need cover combined with market participation in a single contract.
- At 8% gross return and age 35, net XIRR over 20 years is roughly 5.7–6.2% — the mortality drag costs approximately 0.5–0.8 points relative to Index Plus at the same premium.
- Do not buy this as a pure investment. The mortality charge is the price of the extra life cover; if you value the cover, the product makes sense — if you don't, the cost is dead money.
Asymmetrica isn't an insurance advisor. The opinions above are editorial; charge figures are computed from the plan's own brochure. Read both, then decide.
Tax treatment
- §80C deduction
- Premiums deductible up to ₹1.5 lakh/yr — only under the old tax regime. Forfeited if you switch to the new regime.
- §10(10D) — death benefit
- Always exempt from income tax regardless of premium amount.
- §10(10D) — maturity proceeds
- Exempt only if your aggregate annual premium across all ULIPs is ≤ ₹2.5 lakh (Finance Act 2021, applicable to policies issued on or after 1 Feb 2021). If the aggregate premium exceeds ₹2.5 lakh, maturity proceeds are taxable as LTCG at 10% without indexation.
- Fund switches
- Switching between funds within the ULIP is not a taxable event — no capital gains on switches.
Same §80C and §10(10D) treatment as other ULIPs: premiums deductible up to ₹1.5L/yr (old regime only); maturity exempt if aggregate annual ULIP premium ≤ ₹2.5L; above this cap, LTCG at 10% without indexation (Finance Act 2021). Death benefits always exempt. Fund switches not taxable. Higher premiums are common in protection-weighted ULIPs — verify aggregate premium against the ₹2.5L threshold before buying.
Deep dives
More on Protection Plus
Asymmetrica isn't an insurance advisor. Charge and projection figures are computed from published LIC brochures using IRDAI-mandated return assumptions. Verify current rates and eligibility with LIC or a licensed advisor before purchasing.
Last updated · site changelog