HDFC Crest ULIP – Discontinue or Continue?

In this article, I will explain how you can easily decide whether to discontinue or hold your HDFC Crest ULIP (Unit-linked insurance plan).

There are certain points about HDFC Crest ULIP that are important to know. These have been covered in an excellent article by Deepak Shenoy at Capital Mind. He has explained why the high charges don’t leave too much on the table for the investor. A better option will be to invest in a mutual fund and a term plan separately. Separate your investment and insurance respectively instead of combining it in a ULIP.

What if you have already invested in HDFC Crest ULIP?

I was asked this question by a reader who is around 32 years old. He pays Rs. 50,000/- as premium every year. He gets Rs. 5,00,000/- as death benefit. He started investing 2 years back in the highest NAV guarantee plan. Now his third year premium is due and he is in a fix. He does not know whether to discontinue or continue investing till the fifthyear.

I am sure there are many people in this boat who don’t know what to do with a product with high charges.

What are the discontinuance charges in HDFC Crest ULIP?

There are discontinuance charges that HDFC Standard Life levies if you decide to stop paying premiums before 5 years have passed from the day you start the policy.

Where policy is discontinued during the policy yearDiscontinuance charge
1Lower of 6% of (AP or FV) subject to maximum of Rs. 5,000/-
2Lower of 4% of (AP or FV) subject to maximum of Rs. 5,000/-
3Lower of 3% of (AP or FV) subject to maximum of Rs. 4,000/-
4Lower of 2% of (AP or FV) subject to maximum of Rs. 2,000/-
5 and onwardsNil

AP – Annualized premium

FV – Fund value on date of discontinuance

I have obtained this data from the policy document.

Do I get invested money back today if I discontinue my HDFC Crest ULIP?

An important consideration is that the fund value at time of discontinuance is not paid out to the customer.  Instead, it is held by the insurance company till the end of the 5 year period. This sum earns 3.5% till the end of the 5 year period. This earning is a pittance. In general, it is another reason why I have a gripe with ULIPs. There are simply too many problems in getting out of a ULIP where a customer is made to jump through multiple hoops to reach the exit door.

Please read the Capital Mind article first and then come back to follow up with an Excel that I have created that will help you make a decision.

Should I discontinue or continue HDFC Crest ULIP?

Click here to download the Excel.

  • In this Excel the assumptions are placed at the start. You can modify cells marked in green. I have neglected service taxes in the calculations.
  • I have assumed that premium amounts for first 2 years have been paid because this is the case that the reader is facing. You have a decision to continue with the third year premium or discontinue right here.
  • The first half of the Excel considers that you continue with the policy. Here the various charges eat into your returns. They are relatively high as compared to the charges in mutual funds as you will see in the second half of the Excel. I have also deducted mortality charges that go towards the death benefit of Rs. 5,00,000/-
  • There are three scenarios I have taken in the first half – 5%, 12% and 20% return in the underlying funds.
  • In the second half of the Excel, I have considered a case where you discontinue the policy. For whatever is invested already in HDFC Crest, you earn a 3.5% interest rate as mentioned already.
  • I assume that the amounts for third to fifth year are invested instead in an equity linked tax saving mutual fund.
  • The requisite amount to get a life insurance cover is deducted every year. I have taken LIC Anmol Jeevan policy premium as an assumption for Rs. 5,00,000/- (same as the death benefit under HDFC Crest policy right now for the reader). I tried taking the HDFC Click2Protect term insurance amount but the premium calculator does not deal with premium amounts which are less than a particular limit.
  • The second half of the Excel has comparisons between the two options – continuing and discontinuing respectively.
  • Assume that the Crest fund manager’s deliver returns on their portfolio of 5% (before any charge deduction). Assume that an equity tax saving mutual fund also returns 5%. You will be better off by discontinuing the policy, paying the necessary exit charges and taking a fresh term insurance and investing similar amounts in this equity linked tax saving fund.
  • I have next increased 5% to 12% and again compared the 2 options before us – discontinue or continue. You will be better off even in this case.
  • Finally, if you increase expected return to 20%, you see that it is better to continue the Crest policy.
  • This behavior is because the opportunity lost on the sum that is locked up with HDFC Standard Life, keeps increasing with increasing expected returns.
  • Most importantly, please remember that expected returns cannot be forecast. I don’t know what the market will be 3 years from now nor do I know how Crest or any equity linked tax saving mutual fund will perform. These are assumptions and this is a model that tells you how things will be in different scenarios.
  • Economics tells you to ignore sunk costs. In plain English, it means that you should not cry over spilt milk. In this case, the milk does not fall to the floor. You get it back, albeit after some time. The hitch being that you cannot put the milk to good use today since it is not in your hands.
  • Expected returns of 20% for next three years would mean that for Rs. 100 invested at this rate would grow to Rs. 172. Or, a 72% gain in next three years. Or, consider that the Sensex would have to rise above 33,000 from the closing figure of around 19,242 on 23 December 2012 in the next three years. To me this seems to be on the higher side. But then that’s my opinion.
  • You will also have understood that the lesser money you have locked in the better it is for you. In this case I have assumed that 2 premium payments have been made. If you have made 1 premium payment, the decision to discontinue is easier.


HDFC Crest does not look like a great product. For those who have already gone down the road with this product, discontinuing will make sense for a scenario with market returns that are in line with average figures.

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  1. Raveendra Singh says

    That’s a great piece of analysis. My only doubt is why you wouldn’t consider the tax benefits of the ULIP scheme?
    That is clearly a point winner for the scheme. In your analysis, therefore, even with a 5% return, discontinuing the ULIP becomes beneficial by 12,875 instead of 47135(30% tax on the mf return) and at 12% the ULIP becomes better. Well, this is ofcourse assuming you are in the highest tax bracket.
    Is this tax benefit that ULIP schemes keep claiming (under 10 10 d even if you don’t die and get the amount it is under a life insurance policy) not applicable?

    • says

      Thanks Raveendra, I am glad you found it useful.

      If I have understood your question correctly, this explanation should be ok. I have not considered tax benefit for either HDFC Crest product or the mutual fund. For clarification, I have mentioned in the article that it is a mutual fund under the ELSS category which gives tax benefits.

      So, we are good, if we don’t consider 80 (C) tax benefits in both of these schemes.

      Do let me know if this answers your question.

      • Jacob says


        I have committed to an HDFC Crest Policy for my son and I am paying a premium of one lac a year. I have already paid three premiums, after going through your post i find that i have made a mistake. Do you think that it is wise to continue paying the premium or it is better to discontinue it? If i discontinue, will i get the amount released immediately or will i have to wait for five years?

        • Mayoori says

          Hi kunal I have also completed 5premium of hdfc sl crest from 2013. Now when I analysed that they cheated ……. monthly policy charges are very high . What should I do ,if I continue this plan up to 10 years my fund value may be less then present fund value as they charged around 4000 per yr. should I surrender it pls suggest

      • Mayoori says

        Hi kunal I have also completed 5premium of hdfc sl crest from 2013. Now when I analysed that they cheated ……. monthly policy charges are very high . What should I do ,if I continue this plan up to 10 years my fund value may be less then present fund value as they charged around 4000 per yr. should I surrender it pls suggest

  2. suman kumar says

    in january 2009 i had started ulip plan. hdfc younger star plus 2 ulip plan. but i pay only 14 month as 1500/- per mont …
    and its Five years is going to be completed.. than will you tell me what is my fund value today. and how can i withdraw . please tell the process of withdraw

    • says

      Hi Suman,

      First, Sir is not necessary. Informal is better.

      Your fund value (NAV per unit) can be found out by talking to the HDFC folks. Ask them on the helpline. I have not looked at “Younger Star” plan before. In the initial document that they send over when you sign up for the policy, all the terms and conditions are given. The withdrawal process will be given there. Please don’t take a hasty decision. Find out whether there are any charges applicable on cancellation.

  3. Rohan says

    Hi Kunal,
    This is a great article, but I am unfortunately less savvy when it comes to financial terms. Perhaps you can help me out…
    I’ve invested in Crest since 2011 and made 3 payments of 1 Lakh each…Ive got 2 more payments to go…Ive been told this is the highest guaranteed plan..I am also an NRI, so I dont think the tax benefits apply in any way.

    After reading this article I am not too sure if I should continue or discontinue – I am in no urgent need of the money but I do know that as an NRI I get 8.75% on other Fixed Deposits I do have.

    Could you advice as to what exactly I should be doing? ie continue the policy and keep paying the premium or discontinue the same (Ive asked HDFC what is the net amount I will receive at the end of 5 years but have yet to receive a response from them)

    • Avinash says

      Hey Rohan & Kunal,

      I’m in a similar boat, I’ve made 2 payments so far and the third one is due in October 2014. BSE is at 25K mark and NSE close to 7.3K. So it looks like the equity markets have done extremely well in the last year or so. In the current scheme of things and if I understand Kunal’s analysis correctly, it makes sense to stick with the HDFC SL Crest Guaranteed NAV fund as apposed to canceling today. Kunal – would you agree?

      Rohan – I was wondering what you decided? Are you still invested or decided to cancel it?


  4. Rohan says

    Just as a follow-up to my previous query..what they mentioned is the minimum guaranteed return i will get is 7.5 lakhs and the maximum could be upto 30 – since i have already made 3 payments, it seems as if i should continue with this, though id of course be interested in hearing your opinion.
    One addnl point id like to ask is…what do you suggest as a good plan to invest in?

    • says

      Hi Rohan,

      The more installments one has paid in this scheme makes the stop decision tougher to make. This is because the amount paid already cannot be received immediately. It stays with the insurance company and is returned after at the end of 5 years as per the clause. Till that time it earns a return of 3.5% which is too low in my opinion.

      I have given an example of someone who has paid 2 installments. You have paid 3 installments. You are worse off than the person mentioned for starters. I really cannot predict what the equity market will deliver over the next few years. The stop or continue decision depends a lot on this factor.

      I am not a fan of ULIPs as I have already mentioned in the article. For future financial decisions, please separate your investment and insurance needs.

      First work on understanding your life insurance requirement depending on who you your dependents are and how much you would want to leave behind for them in case of an unfortunate demise. For this a plain vanilla term insurance plan is best. Also look at whether you have adequate medical insurance.

      Second, for investing needs it is always better to choose a mutual fund which has a good track record. Look for periods above 3 years. 5 years is best viewed.

      For example, visit the link below:

      Click on 5 years and sort schemes based on returns. Also look at expense ratios for the scheme. Lower expense ratios are better for you in the long term.

      Start of with exposure to the equity market with large caps preferably. Later, you may add some exposure to mid caps. Don’t delve into sector equity funds unless you have a grasp on the outlook of the particular sector.

  5. manoj says

    I’ve invested in hdfc youngstar plus of 1 Lakh and creast 60,000 this year.yet to pay 4 installment. whats is yoyr suggesion

    • says

      Hi Manoj,

      I have not looked at HDFC Young Star. Can’t comment on it. About Crest, my study says that it is easier to exit if you have paid less installments. This is because if you stop in a particular year they don’t return the money paid till that point. They keep it with them where it earns a measly return for the next few years till they return it to you.

  6. Paul says

    Hello Kunal,

    Thank you for your great insight details…I am also struck in this HDFC ULIP policy or whatever they are saying !!!
    I have made three investments amounting 50K for the past three years since 2009. However i thought they are cheating me so i stopped paying them since 2012. The agent told me i should not withdraw but should keep the amount till maturity ie. till 2019.
    1) If i withdrew all or terminate my policy would the HDFC consider my policy termination after 4 years or three years?
    2) should they pay me the amount as mentioned in your first chart? they could always use excuse saying that my policy was old and would not fall under the new termination scheme…!!!??

    Help me ..thank you inadvance..
    God Bless you…regards..

    • says

      Hi Paul,

      It seems you are in the same boat as the person that I wrote about in this article. Since you have made three investments these will be withheld as per the clause. There is no question of a fourth one.

      I did not understand the new termination scheme question. Please elaborate. Are the clauses in your policy different from what I have written?


  7. Paul says

    Hello Kunal,
    Thank you fro your swift/ kind response, my policy reads..Schedule charges for HDFC Unit Linked Endowment Plus II….further down it reads,
    Surrender charges…..
    No. of original annualised Regular premiuns not paid in 5 years.. Surrender charge
    4 95% of the fund value
    3 35% of the fund value
    2 15% of the fund value
    1 5% of the fund value
    0 NIL

    so here i am confused whether while surrendering my policy do i have to pay the charge 15% of the fund value or the 5% since i am now in my fourth year since the inception of the so called great HDFC policy !!!
    I hope i am clear on this..

    please guide me whether i should keep the remaining fund as it is or surrender …the current fund value is only 100500…less 45000 of my principal amount !!
    Thank you sir…
    best regards….Paul

  8. Paul says

    Hello Kunal,
    Sorry i had to re-post it…especially the table one since it got mixed up….
    No. of original annualised Regular premiuns not paid in 5 years.. Surrender charge
    4th year 95% of the fund value
    3th year 35% of the fund value
    2th year 15% of the fund value
    1th year 5% of the fund value
    0 NIL

    so here i am confused whether while surrendering my policy do i have to pay the charge 15% of the fund value or the 5% since i am now in my fourth year since the inception of the so called great HDFC policy !!!
    I hope i am clear on this..

    please guide me whether i should keep the remaining fund as it is or surrender …the current fund value is only 100500…approx..less 45000 of my principal amount !!
    Thank you sir…
    best regards….Paul

    • sweta says

      Hello Paul,

      I am also stuck in this HDFC plan . I have already paid 4 installments. Were you able to get back your money from them, and if you were, how much money did u get back.


      • says

        I think, Shweta, if you have paid 4 years worth, you are already at the boundary point after which you can stop paying. Correct me if am wrong. In your case there is relatively less to salvage. Still, try speaking with the company folks.

      • ABBEY PHILIP says

        I also got stuck with this policy but I realized at least before I was to pay my first year premium on 22nd Nov 2016 to the tune of Rs 90,000.00. Now amount available as per NAV (3,65,000.00 ) as on 22nd Nov 2016 is in the dis-continued fund. Since I paid premium for 4 years already on the expiry of fifth year they will give back the money with 4% interest. There is no point in keeping money in this fund. Mortality and other 3 charges are so high.

  9. Paul says

    Dear Kunal,

    is there a difference between HDFC Crest ULIP and market linked ULIP, mine one is market linked !!

    thank you and regards..and happy weekend, regards, Paul

      • Senthil says

        Hi Kunal,

        I am one among you ! I paid 2 years 50K (100,000) and from third year I felt that , I have been cheated so stopped , as they said if I discontinue , I will be getting my money (100,000) in 5th year with interest after deducting fine and other charges , today one executive calls me and says my fund value is 51678 ! I am shocked ! can you pl tell me how to go further , hope on 5th year they are not going to ask me another 100,000 as fine to withdraw from their bloody policy

        pl help me as I am in serious mental trauma !

        God Bless You

  10. says

    Today only i invested for this plan HDFC Crest plan. I don’t know what to do now. I could not read this article on time :( After reading this article i about regret my decision now. Is there any way to cancel this plan and get back my money ? As i started today only . Is there any time limit so that i cancel this plan ?

  11. Paul says

    Thank you Kunnal that means if i discontinue or surrender my policy. my penalty would be Lower of 3% of (AP or FV) subject to maximum of Rs. 4,000/-. I will then discontinue it and have it invested somewhere else..
    you have been a great assistance, appreciate your response, thank you in advance, God Bless You

  12. sameer joshi says

    Hi Kunal,

    I’ve read your article regarding crest found it very useful, still I require you guidance. Let me explain my queries.
    1) I’ve invested in crest for Rs.50,000/- highest guaranteed NAV plan and have paid two premiums for 50K. My FV is 94,000/-
    2) I’ve invested another Rs.50,000/- in Market linked Crest Plan and have paid two premiums for 50K and my FV is 84,000/-

    I would like to discontinue both the plans and I’m in no requirement of money wouldn’t want to surrender either. I’m planning to invest the same Amount in SIP’s for the rest of the tenure. Is it a wise decision. I request you to please advise me your advise would be of immense help for me.

    and at last I would like to thank you for bringing in lot of valuable information. I’ll be waiting for your advise and take a decision.

    Sameer Joshi

    • says

      Hi Sameer,

      Why don’t you speak to your insurance company representative and confirm with them too? Ask them how much you stand to get paid out if you want to cease payments? How much do they keep with them for a few more years? What does it earn?

      The broad logic, is that if you have paid for less number of years, the decision to stop is better. This is my understanding of this product. I will be happy if you achieve a better return on your money going ahead. Best of luck.

  13. Saravanan says

    Hi Kunal,

    I have invested in HDFC Crest Plan Last November , but now i want to discontinue this Plan, what will be the return fund value after considering all the charges . Can you please tell what are the charges ( hidden and open) . so that we can calculate

    • says

      Hi Saravanan,

      I have described all the charges that I saw in this policy as per the document given when you sign up. I don’t have the document with me now. It belonged to someone.

      Please speak to your insurance company representative and ask them the exact value if you discontinue right now? Ask them to give a breakup of all charges / deductions / fees. They have to tell you that. That is the best source. Then run a comparison of all they say against your policy document and confirm.


  14. Jarnail Singh says

    I would like to ask regarding my policies which I did with HDFC standard life insurance policy (Sar Utha Key Jiyo). ). I have started 2 policies (Myself and for My Mother) in 2009 through my Bank. I have paid 5 premiums for my policy. 2 premiums are due for my mother policy. The amounts of both policies are down. Now my bank representative was telling me that don’t pay the premium and wait till share market will be down. Now I am confused when is good time for pay the both premium amount for my mother policy? Please advise

    Thank you in advance

    • says

      Hi Jarnail,

      Is is the same HDFC Crest policy? If it is some other policy, I am not sure whether the terms and conditions are same.

      It usually is not a simple matter of not paying the premium and being able to pay later. There are deadlines usually for payment. If they don’t receive the money the policy might lapse.

      You have to check this with the company.


  15. Husna says


    I have bought HDFC SL Crest policy and date of commencement of policy was 20-11-2010 where i pay yearly premium of 50,000 per year for a period of 5 years and policy term is 10 years.

    I have paid 3 premium installments for a period of 3 years which is a sum of 1,50,000 and 4 th year premium 50,000 is due for payment this 20-11-2013.

    I have few loans to be cleared off now and don’t want to continue HDFC SL crest policy and pay this premium amount of 50,000 for this year.

    Please suggest what should i be doing at this point of time, is it worth to continue this for period of 5 years which i do not want to and if i plan to close it at this moment how much would i get back in hand?


    • says

      Hi Husna,

      You would have seen in this article that the longer you wait it is counter-productive to stop the installments. That said, if you have outstanding liabilities repaying the loans is higher in priority than making these investments. You are paying a rate of interest that has a greater chance of being higher than what you can earn possibly through the policy.

      In general, it is good to reduce expensive loans first.

      Please speak to your company representative to understand how much amount you can get back if you stop today and the balance that stays with them for the next few years after which they can give it back too.


  16. Bipin Vayalu says


    Thanks for analysis and sharing with us.

    I am 25 years old, I bought HDFC SL Crest in November 2010, I had paid 3 premium and 4th one in this (November 2013) month, I am in confusion since last 6 month.

    1) can you please suggest me should i continue and discontinue plan?
    2) if i discontinue, how much charge should i need to pay for surrender?

    Thanks in advance!

    • says

      Hi Bipin,

      The way this works is that the more payments you have made you are closer to the limit of 5 years beyond which you can cease payments. The answer to your problem is tougher. You would have seen that in the Excel that I have provided, the answer to whether you should discontinue is dependent on expected returns. Now this is something that neither you nor I can forecast about the market. I know my answer might seem confusing but I really don’t want to stick my neck out on what the market will return. I focus on individual stocks. My returns are different from that of a mutual fund or an insurance company. They tend to hug the benchmark. I don’t.

      Please speak to your company rep. and ask him what are the charges etc. for surrender. How much will they keep with themselves? When does the amount get released?

      At least for ahead, you can stick to basic term plans and mutual funds to take care of insurance and investment needs respectively. I wish you the best ahead Bipin!


      • Bipin Vayalu says

        Hi Kunal,

        Thank you so much for your quick response.

        Today i talked with company rep., They told me you cannot surrender because of locking period of 5 years but discontinue can be possible, and Discontinue charges is 3% (as 3rd year) on Fund Value and remaining fund will be moved in “Discontinue fund” will provide 4.5% simple interest (same as saving account). Fund value+Earned Interest will be released after 2 years (i.e. Nov 2015).

        Bipin Vayalu

        • says

          Yes, there is that discontinuation charge which I have covered in the article too. Overall, I find that products like this one are too complicated. They make you jump through hoops. Compare that with a mutual fund. An exit load and you can get out if you wish. None of these onerous clauses.

  17. Vidyadhar Muley says

    I have HDFC young start ULIP from last 6 years.
    Premium 30 K per year, approx. 2 lakh premium deposited till last month.
    Now, the HDFC persons requested me to transfer some money to some other fund as the current value of units is same as deposited.
    Please guide me ,is it OK to transfer ? will that affect initial benefits associated with the policy? why are they asking to transfer money now ?
    Awaiting reply, Thanks.

    • says

      Hi Vidyadhar,

      I have not seen the Young Star policy so I cannot comment whether it is good. Nor have I seen the other one that they are suggesting to say whether it is good or bad.

      Please ask more questions of them. Start with expenses. Mutual funds don’t have as high expenses as ULIPs usually. The expenses and charges in ULIPs hurt your investment.

      I prefer to separate investment and insurance. Term plans for life cover and mutual funds for investments respectively are better than a single ULIP. Break it down.

      Please read through your ULIP policy wordings. Find out the charges. If you are paying anything more than 2-3% it is not a good option for you. MFs are less expensive.

  18. Rameshwar says

    Thanks for great post. Is there any option to get back instant amount through this policy.

    I wants to withdraw if no matter how much charges will be taken by company.

    Please help me I need argent money.

  19. Bulu says

    I had purchased HDFC SL Crest in Nov-2010 and already paid 15000 till now @ 50000 per year. The next premium is due on 30-11-2013 i.e tomorrow.
    Kindly advise me wheather to continued or not. HDFC representative intimated that the present growth is 8-10 % as per present market trend. My question is how the growth is determined.The present fund value is less than the total premium paid so far.Present fund value is Rs.142000 and the maturaty value will be arround Rs. 395000 after completion 10 years term as inimated by HDFC representative. I dot find any growth as the fund value is less than the total premium paid so far.

    Kindly advise



    • says

      Hi Bulu,

      I think you meant that you have paid 3 premium amounts over the last 3 years adding up to 150,000. My views are clear. I don’t find this to be a great product. My personal view is that I would go for a regular mutual fund with much lower charges and easy entry/exit clauses. This product is simply too complicated.


  20. Aviral says

    Hi sir i have bought hdfc crest 9 month back of 50000 annual premium .can i break it after taking tax benefit in month of april & how much i will get back after breaking the policy

  21. Praveen says


    Thanks for your valuable feedback. Since a lot of people have paid 3-4 premiums and the money is stuck can we approach say IRDA since the number of people disatisfied with the returns is large ? Is there any other way out or one has to simply pay for 5 years?


    • says

      Praveen, in the first place, any insurance company can launch a plan only after IRDA approval. Taking this to the IRDA is pointless. They passed it in the first place.

      I find mutual funds better regulated and clearly less expensive.

      You have no way out of the clauses once you sign up.

  22. Jayavardhan says

    Dear Kunal,

    Appreciate your analysis on the HDFC SL Crest. Impressive Analysis. I am one of the fish fallen in the trap of this product and doesn’t seems to be a right one for an individual. Coming to my case, could you please suggest me whether i can quit now or not ?

    Started in 2010, every year i am paying 50,000 as a premium. So far done with 3 premiums and 1 pending for coming month. Could you please suggest me whether quit or continue ? If i quit, how much amount i am going to get or quit after 5 years, how much it would be ? (definitely i dont want to wait for 10 years though). Just thinking to quit 4th year or 5th year is the dilemma ? please suggest me. thanks in advance,

  23. Suresh says

    Dear Kunal,

    Thank for your analysis on this plan.
    I am also in the same list of the trapped fish for HDFC CREST. I paid premium of 1Lac around six months ago.

    I just wanted to check, instead of opting out, isn’t there a way to switch to another product. Is that worth a look?

    Thanks in advance

  24. Rayudu says

    Hi Kunal,

    Your article is very useful to me, i am a NRI, working in UK. I have a dilemma either to continue or stop paying further premiums in my ULIP policy. Here are my policy details

    Policy : HDFC endowment unit linked plus ii
    Start date : 09/09/2009
    Amount paid : 53(months) * 3000 (SIP) = Rs 159000
    current fund value : 1,35,500 ( Loss of nearly Rs 23,500)

    Below are various charges

    FMC – 1.25%
    Policy Administration Charge: Rs. 60 per month
    Premium allocation charges are
    1st year – 60%
    2nd year – 7%
    3rd year onwards – 2%

    Till now i have paid premium for 4 years 5months, is it a good idea to pay for another 7 months and with draw after 5 years to avoid surrender charges? I won’t be visiting India until end of this year.

    Also I am investing 15k in 3 Mutual funds through SIP, now i want to redirect this 3k into existing MFs.

    Your suggestions are most helpful in deciding my next steps.


    • says

      Hi Raydu,

      It will be unfair for me to comment without properly reading the policy. If FMC is fund management charge, I see that FMC plus premium allocation charge adds up to 3.5%.

      This still is at least 1.5% higher than most good mutual funds.

      I am not going into damage done already (if you compare this to a typical mutual fund since the start of the period). But even if I look ahead it does not look good as compared to a mutual fund based on this limited information. I

      There are multiple things here. I do not know the cover this gives you and what the premium cost would be like if you purchased a decent term plan for life cover.

      You will have to factor that. Because if you pay 2% management fees in an MF, you still have to pay term insurance premium to take care of life over which is over the 2%.

      • Rayudu says

        Thanks for the reply, here is the link to the policy

        Insurance cover for this policy is 3,00,000, i don’t think this is enough cover for me. I am planning to take 1 crore on line term plan when i visit India.

        When i checked the policy statement, below are the expenses

        Monthly Policy charges Rs110 ( I think this is PAC (70) +Mortality charges(28) + Taxes (12))
        Service tax Rs7.20
        Premium allocation charges Rs 60

        Total – Rs 177.20 -> Approx 6% of Rs 3000 ( Monthly Premium).

        3 Mutual funds i am holding have a maximum expense ratio of 1.5%. Other than the expense ratio is there any other charges for Mutual funds?

        • says

          Ok. So the bulk of the premium is going towards investments and not insurance. You are better off in a mutual fund after you stop deploying more in this ULIP.

          You are rightly thinking of a separate term insurance policy.

        • says

          Also after 5 years I see absence of surrender charge. So you are almost there now. Please do your bit and educate others. There is a lack of awareness which we can bring down.

          • Rayudu says

            Thanks for the quick responses, certainly i will educate my friends, relatives and colleagues.

          • John says

            Hi Kumal,

            I have paid the HDFC life crest premium for 5 years. Last premium paid was in the Jan 2015. What next..? How much amount am I eligible to get..?

  25. Arun says

    Hi Kunal,

    I wish I read this before I got trapped into this HDFC SL Crest. I have two questions. 1) I have been remitting 3.0 L into this policy and already paid 3 premiums. Two to go. In my policy they mentioned that current sum assured as 3000000 and the maturity date is 2021. Does that mean I will get this much at 2021, if I completed my payments. The policy also mentions an additional benefits of same amount as death benefit.

    2) Can you please suggest me a safe plan which will ensure me at least a 10% returns post taxation. I can afford to wait 3 – 5 years for the returns.



  26. Siva says

    Hi Kunal,

    Your article is very useful to me, I also got trapped into this HDFC SL Crest, I have started last year with the yearly premium of 2 Lac, The next premium is due on next month.
    Kindly advise me weather to continued or not.
    Yesterday only I saw my statement in HDFC web site it was surprising to me about the charges,HDFC representative never informed me about the this.
    After seeing your excel sheet, my mind change to not to continue.

    Kindly advice


    • says

      Hi Siva,

      The working of this product is pretty clear. I believe that there are better alternatives. And like I explained, the earlier one sees this, the easier is the decision to get out.

      Please pay it forward :)

      • John says

        Hi Kunal,

        I am also in the same situation. I have paid the HDFC life crest premium for 5 years. Last premium paid was in the Jan 2015. What next..? How much amount am I eligible to get..? Please share your valuable thoughts..

  27. Jayaram says

    Hello Kunal,
    I am in a fix.

    a) I had invested 1 Lakh per year in HDFC SL Crest and i have paid 3 premiums so far. I have also invested Rs

    b) I had invested 1.5 lakh per year in Kotak Life Dynamic Flore fund and i have paid 3 premiums so far.

    But with the returns and their benefits, after some financial wisdom, i am quite convinced that both these are worthless investments.

    So my question is if i stop paying the premiums from this year ( 2014), when will i be getting back the money.

    For this 7.5 lakh invested in total, what can i expect to get back and when?
    Pls help me decoding this.

  28. Siva says

    Hi Kunal,

    I had asked HDFC representative about the charges ,below message received from him.
    Kindly advice.



    Dear Sir,

    I have checked your investment there are some charges has been getting detected from invested amount on monthly basis, that’s a Policy administration charges nothing to worry sir Crest investment plan is a good investment plan and also it has guaranteed returns whether market is performing good or not minimum guarantee of Rs 15/- NAV is guaranteed or Higest NAV recorded in first & 7yrs or Fund value whichever is higher at maturity, Even though if they are detecting charges the total charges will be very less 10 yrs approxmetly 2.5% and the net yield will be 7.5, over a 10 yrs time it will give you good returns with tax free and please find the key feature of crest plan.

    Key Feature of HDFC SL CREST:

    * Pay premiums for a limited term.

    * Valuable financial protection for your lovable ones .

    * Flexible additional benefit opportunity.

    * Benefit of Highest NAV at maturity.

    * Benefit of minimum guarantee of Rs 15/- at maturity.

    * An outstanding investment opportunity.

    * In case of unfortunate event of the LA during the policy term

    We will pay sum assured or fund value whichever is higher.

    * Liquidity option.

    * Partial withdrawal.

    * Tax Benefit

    U/S 80 C tax exemption
    U/S 10 10 D Complete tax free returns

    Thanks & Regards

    Kadhiravan R | Sr. CAM | Bancassurance | HDFC Life

  29. George says

    HDFC personnel bankers slam SL CREST on their customers and I am a victim. I reviewed this article after investing ONE Lakh per year ! Fortunately, I could exit from this ULIP plan during its free look period. However, HDFC life levied Rs. 7000/- from my ONE lakh initial deposit. I discontinued my banking with HDFC thereafter. DON’T let them keep a SL CREST on your head !!

  30. stephen says

    I have invested in HDFC crest as well and am looking to get out of the fund.
    I have one doubt regarding your excel sheet though in row number 62 , the start amount must be 89000 assuming a return of 5% return. Correct me if iam wrong

  31. Sukanto says

    Hi Kunal,

    First of all THANKS A TON for bringing a detailed analysis about such a misleading product to all our notice. I have made my decision and am definitely going to surrender the policy but want to know when and how ?

    I am in the same situation(3rd yr premium is due), my premium(50k) due date is 17/04/2014 and my current value of Fund is 97k, as suggested by you to many others in my situation I called the company representatives and got to know that if I surrender my policy before 17th the surrender charges will be A+B (ie. A. Lower of 4% of (AP or FV) subject to maximum of Rs. 5,000/- & B. 0.5% every year till 5th yr for fund management) and if I surrender after 17th it will be C+B (i.e. C. Lower of 3% of (AP or FV) subject to maximum of Rs. 4,000/-).

    Now that I want to surrender the policy should I do it ASAP or wait till 17th, what am worried is about there monthly charges which i guess will add for 1 additional month if i wait till 17th & also want to know if you considered surrender charges in B and mentioned the interest rate of 3.5% instead of 4% on the remained fund that get’s locked till 5th yr.

    Just an info to help other readers:
    Apart from that he also mentioned about the 30 days + 35 days grace period after the premium due date in which i can rethink and make the payment in case I have not done the payment by due date and the policy will continue else lapse automatically and surrender charges (C+B) will deducted and the remaining fund will be locked till 5th yr and I will get 4% interest as per SBI saving account rate

    • Jayaram says

      Hi Sukanto,
      My question has been not unanswered, but from your query i understand that since i’ve paid three premiums and the policy is in the 4th year, i would lose 4000 or lowest of 3% of the AP or FV and thats it.
      So the current value – 4000 would be invested at 4% savings bank interest year or year. Is this right, or am i missing something?


  32. says

    dear sir unfortunately I have deposited in hdfc crust policy. . I suppose to open a fixed deposit but my personal banker converted it tooo crust plan. . now I am unable to pay second year term for my policy and what I invested I need refund that amonut. but bank people saying its impossible what I have to do sir. ..

  33. Gauri says

    My investment policy HDFC SL Crest started on Nov 10. 2010. I paid the premium of Rs.50,000 for 3 years. (Nov 2010; Nov 2011, Nov 2012) I wanted to withdraw the amount. Will I be able to withdraw it after Nov 10, 2014 or will I be able to withdraw it only after Nov 10, 2015? Can you please let me know.

  34. Mahesh Singh says

    I have invested in HDFC Simple Life Crest highest NAV Plan in the year 2010 for a premium of Rs-10000/- yearly and have paid four premiums. Can you calculate for me if I discontinued for the fifth premium, what will be my return at the end of 5 years.

  35. Preeti says

    Hi Kunal,

    like Rohan above I too am an NRI and in my 4th year of HDFC Life SL Crest ULIP paying Rs 2 lakh annually). Am not very investment savvy so invested in this one as my HDFC relationship manager assured me its a very good option for me.
    Given that I have only 2 more payments to go, I guess discontinuing makes less sense.
    So could you please help me figure what exactly I should be asking HDFC at this point as to what I can expect at end of 5 years ? Can I withdraw all amount @NAV) at end of 5 years and reinvest in better options (eg MFs as suggested by you). Thanks for helping me with some insight about what my best options are.

    Thanks and Regards

  36. Deepak says


    Thanks for through analysis and sharing with us.

    I bought HDFC SL Crest in June 2012, I had already paid 3 premium (Rs 75000). Now I don’t want to make any other payments. Is it the right time to quit or should I pay for the whole 5 years. Please help me on this.

    Thanks & Regards,

  37. BEN says

    Hi, I was reading through all comments in this article.

    To day i had a meeting with HDFC life Service Department Manager.

    I have a policy with them 2LAKH/Year, I only paid once, after that i realize that this is very bad investment option so i discontinued from this after 1st payment.

    My fund value as per closing is around 195125 i paid 20000. So running below -5000 now.

    Is there discontinues charges in each Year?
    They did’nt clear it. They tell me there are mortality charges and administration charges in each year is that true? (What to administrate in discontinued funds!!!!)

    My lock in period end on : 23/7/2017

    My last statement is as per below:

    FUND VALUE as per 27/9/2013 : 187776
    Discontinues Charge : 5618
    Amount Move in to discontinues policy fund : 182158

    Value of discontinues Policy as on 23/7/2014 : 195125

    How much money i will get after my lock-in period (23/7/2017). The interest of 3.5% Year for 195125 ?

    Can i take My 195125 now and make it into another investment like Mutual fund or FD? They told not possible.

    If there Discontinues Charge : 5618 in each year i will end up with amount on 23/7/2017 that will be less than my invested amount 200000.
    If i put that 20000 in a FD of 5Years i may get more that this…….

    During the meetup they have give me another option that is:

    I start another Guaranteed investment plan (not HL CREST) That plan will provide 12-15% Guaranteed return per year. They told me the fund will be purely on Government and others bonds. Not depends on stock or stock market so it guaranteed on paper.

    So first i pay first 3 Years 50K and after 3year, last 4 years payment can be made using the my existing policy value 200000 so my total investment in 7 years will be 350000 which having rate of 12% so i get a good return. That the only option they can provide to cover my risk.

    What a hell policy…….

    Thank You

  38. Niraj says

    If I’m not getting you wrong, there is one overlook in excel sheet prepared by you.
    If you look to cell# C62, C84 & C105; there is discontinuance charges on policy.
    Which isn’t taken into account, while calculating End Amount i.e. cell# I62, I84 & I105 respectively.
    As per me, discontinuance charges should be deducted from the start amount before further end amount calculation.
    Pls correct me, if I’m wrong.
    Further, I also don’t find any basis for Start Amount, cell# B62, B84 & B105. Pls. clarify.

  39. shamnavas says

    sir,i finished my crest this i completed 5 years.i wnt to withdraw this amount it possible?and what is the procedure?pls reply

    • John says

      Hi Shamnavas, I am also in the same situation. I have paied the HDFC life crest premium for 5 years. Last premium paid was in the Jan 2015. What next..? How much amount am I eligible to get..?

    • John says

      Hi Shamnavas, I am also in the same situation. I have paid the HDFC life crest premium for 5 years. Last premium paid was in the Jan 2015. What next..? How much amount am I eligible to get..?

  40. Mahesh Singh says

    Hi Suman,
    I have invested in HDFC SLC highest NAV Guaranteed Fund Scheme of premium Rs. 50,000/- and i have paid four premium, but now i want to discontinue the plan. Can u calculate what will be the sum i can get at the end of 05 year @ of present NAV value.

  41. Rajesh says

    I ended up investing in the plan on on Jan-2013. The NAV was 10.54 Rupees at that time and today its 13.30 Rupees. The fund since Jan 2013 has grown by more than 25%. Worst case, We have a guaranteed return of 15 Rs per NAV for sure. why would you all discontinue while its growing ? I am not a big financial planner. I approached the bank for a fixed deposit, but they canvased me and made to invest in this.

    I Google this every now and then and understand what is happening. For now the plan is going well. Please verify the below link to check, how your fund is growing.

    This is a 5 year lock-in scheme and your true maturity will be available with all your growth only at 7th to 10th Year. If you want to withdraw after 5 years, you get what you paid + small interest only.

    The NAV is growing and I’d be waiting for a day for the NAV to grow beyond what HDFC promises.

    Best wishes to you all my friends.


  42. jaipal says

    I have investment policy HDFC SL Crest started on Nov 21. 2010. I paid the premium of Rs.50,000 for 5 years. (Nov 2010, Nov 2011, Nov 2012,Nov 2013, Nov 2013) I wanted to withdraw the amount. Will I be able to withdraw it after Nov 21, 2014 or will I be able to withdraw it only after Nov 21, 2015? Can you please let me know.

  43. sunny says

    Hi kunal,

    I am new to these things although I have been investing in this ULIP policy for last 4 years. I have been paying a premium of 1lac for last 4 years. 2015 is going to be my last year. I chose this policy to save tax. As I market is likely to hit 33k with stable and business friendly govt. at the center, what will be the best option for me? Should I withdraw the amount after 6th or 7th year , or I should wait for full term i.e. 10 years. During this period I do have a plan for pursuing masters in management. How could be the ROI after 7th year and after @10ty year.


  44. Rahul H Shah says


    I have paid 3 premiums and now there are 2 premiums to be paid amounting to Rs. 50000/- each. Current HDFC crest highest NAV guaranteed value is 13.226/-. Can u suggest me whether i should continue or discontinue and also what will i get if i discontinue and the charges which will get deducted.

  45. subhasis says

    HI Kunal
    I am a HDFC Crest policy holder.I have paid all 5 premiums till date( annual premium- Rs 50000). I am on the 6th year of the policy and my present Fund value is Rs 278,404.86 should I continue with the the policy? If I surrender my policy today then how much I will be the amount I will get

  46. Kiran.S says

    Dear Sir,
    I have taken this plan 4 years before and going to complete 5th year in another 4-5 months, As described by many writers. This is not doing any good to me in terms of returns and I am not happy.
    Do you suggest me to exit at the completion of 5th year and invest the funds somewhere else.

  47. Bala. S. says

    Dear Kunal,

    Could see the article recently only; your comments on the last two posts would clarify our concerns also about this policy. (Mr. Deepak’s article detailed the scheme but could not reach to that in correct time.)


    i took with this SL life crest plan in jan 2011 and paid annual premium of Rs . 1,00,000 …i paid yearly premium for 3 years…but since i did not paid after that , the policy was discontinued … now i want to know what is the expected return i get after 5 years i.e. in 2016…???

  49. M K Das says

    Dear Sir,
    This year I have completed 5 yrs. premium @50000 for HDFC SL Crest. My question is shall I withdrawal the amount on 6/ 7 yrs or wait for maturity on 10th yrs.
    How much return expected on 6th yrs and 10 yrs.

    Thanks & regards,

  50. Sanjay says

    Dear Sir,
    I am a customer of HDFC SL Crest, I bought policy in Oct 2011. Till date I paid Rs 7,50,000 (Rs 1,50,000 x 5); Now I want to understand to whether to withdrawn the policy or not ?
    As of date total fund value is about Rs 8,04,000.
    So I dont feel its doing good and beneficial.

    Please advise.
    Best Regards
    Sanjay Sinha

  51. Senthil says

    Hi Kunal,

    I took HDFC SL Crest plan in 2013 and paid only one Annual premium of Rs. 60,000 after I discontinued due to my HDFC Life RM commitment misguidance. I open other policy in HDFC SL Sampoorn Samridhi now I completed 3 years. kindly suggest me can I continue the Sampoorn plan and what is the procedure for withdrawal HDFC SL Crest amount? how much I’ll get it?


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