LIC Wealth Plus (Plan-801) cheated investors

Highest NAV of LIC Wealth plus till date is 15.7585 on is 24/01/2018.

I am feeling cheated with one of the investment plan offered by LIC i.e. Wealth Plus (Plan-801) so must be all of other investors who invested in Wealth Plus.

The unique selling point of Wealth Plus was highest NAV will be considered in policy term of 8 years for which investor pays a one time premium. To illustrate this, Suppose investor buys Wealth Plus plan on March 2010 when recorded NAV was Rs 10 and in 2015 if NAV had gone to Rs 19 and then dropped to Rs 15 in 2018(policy maturity) then the highest NAV will be considered as return on investment made at Rs 10 per unit. This result in effective gain of 90% on your investment. Policy also offered sum assured on Rs 2 Lakh in case of death. This sounds very catchy and attractive but wait let analyze how Nifty 50 performed from March 2010 to March 2018.

How Indian market in general performed in same span as of LIC Wealth Plus?

Nifty 50 recorded on 26/Mar/2010 is 5282 and highest till  date 23/Mar/2018 11130. Which results in effective gain of 110% on you invested wealth.

How LIC Wealth Plus performed?

NAV priced at Rs 10 on 23/Mar/2010 and highest NAV recorded till 23/Mar/2018 is Rs 15.7585. Which results in effective gain of 57.76% on you invested wealth. Which is less than half of Nifty 50.

Wealth Plus
Wealth Plus

Overall its a negative returns on investment

What you just read is shocking, isn’t it? Nifty 50 performed so well over span of 8 year in which you wealth actually was loosing its worth being invested in LIC policy. Now you must be feeling cheated right? But wait, there more to it. I will now show the investment expense levied by LIC after which you will never think of investing LIC again. I have invested Rs 40000(forty thousand) on 23/Mar/2010 at NAV Rs 10, which is 4000 unit of Wealth Plus plan. When I check on the website I saw only 3185 allotted to me. This means they have charged a investment fee of Rs 8150(eight thousand and fifty) i.e. 20.3 % of total invested wealth. This was really a big shock for me as well.

Now lets calculate the maturity amount = 3185 * 15.76 = 50195 (approx)

What’s the effective wealth gain = 25.48% of invested wealth that to over span of 8 years. If we adjust for inflation, this is not actually wealth gain.

Average Yearly Inflation Rate (2010-2018) at 6.60 % results in amount of Rs 40000 in 2010 equivalent to Rs 67000 in 2018.

If return on your investment does not beat inflation adjustments you are less-richer(poorer) than you were at the time of investment. This is nothing but negative returns.

 

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23 thoughts on “LIC Wealth Plus (Plan-801) cheated investors”

  1. Hi Prakash

    I also invested 40k/single premium on 31.03.2010. Units allocated to me were even less than you. I am really disappointed about this high investment fee and bad returns. Such a shame.

    Regards
    Harish

      1. Hi Prakash

        I checked with LIC and got my fund history:

        1. Initially they allocated close to 3800 unit and deducted some units every month. After 8 years fund balance was close to 3100 unit.
        2. For maturity as per LIC it was highest NAV of first 7 years of the policy or NAV at the end of policy term whichever is higher is applicable. That is why people who took this policy in 2010 will not even get the highest NAV of 24/01/2018 which is 15.7585

        Regards
        Harish

  2. LIC has cheated its investors in their “Wealth Plus Plan”. They have not clearly set out their investment strategy… they made a wrong statement giving scenarios of returns of 15% whereas they gave to customers returns of only 5 to 6%. People should file a case in consumer grievance forum

  3. Hello sir,

    My parents invested 20k for 3 years a total of 60k, but the final amount they received is 57k, thus a negative return of 3k. When despite writing complaints to lic I didn’t receive any response, I filed a RTI to know the exact reason, and they came back saying that the charges along with motality charges for senior citizens led to this. Pic is the biggest cheat when it comes to investment.

  4. My father is cheated by lic in wealth plus policy ,he invest rs.1lac and after 8yrs he
    get 94,000 shows that it’s clear cheating dekha jaye to chota Bank bhi 8saal bad do guna deta hai dekhiye itni badi LIC abto scam karti hui dikh rahi hai.

  5. Big Cheating !!!! Cheating !!! Cheating!!! Is there any group where we can file a case against LIC ??? i invested my hard earned money 40k in 3 policy in 2010 and after 8 years what i am getting now is 46k ….. i never trust on LIC any more ..

  6. Even my father had invested 40K in 2010 and received only 43k after 8 years of maturity of this same plan, such a big cheat of a company is this. On what basis do we file a complaint, where and how, shld create a watsapp group ? LIC will now show us all their terms and conditions which were written in small hard to see sizes on the policy papers, our parents never read those. Mr. Prakash seems to be having good knowledge of this, probably he can guide us, the agents lured us and we fell victims, agents raise their hands now saying they can’t do anything about it.

  7. Sir,

    What is Income Tax implications?

    Do investor in this policy qualify for Indexation Benefits at 20% as applicable in MF schemes for long term Investments.

    Slaa appreciate an early reply.

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