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The New Bima Bachat Plan from Life Insurance Corporation of India (LIC) is a participating, protection cum savings, non-linked, money-back life insurance policy. This is an affordable policy that provides a host of benefits including a death benefit/maturity benefit, survival benefits that are payable at specified policy years, and loyalty additions. In addition to the policy benefits, one can also avail a loan against the policy if there is a need for emergency liquidity.
The premium payable is linked to several factors, such as the sum assured opted for, the policy buyer’s age at entry, policy tenure, etc. Thus, the premium payable will vary from person to person and also time to time. The policyholder can also claim tax benefits under Section 80C and Section 10(10D) of the Income Tax Act, 1961.
Insurance providers usually set eligibility criteria which need to be met by the policyholder in order to purchase the insurance policy.
|Parameters||Criteria for eligibility|
|Minimum age at entry||15 Years|
|Maximum age at entry||
|Maximum age at maturity||75 Years|
The sum assured is a certain amount of money that is guaranteed to the nominee if the life assured meets with an untimely death during the policy term. The sum assured amount and premium amount are inter-linked. Opting for a high sum assured will require you to pay a high premium, and vice versa.
|Minimum Sum Assured||
|Maximum Sum Assured||No limit|
The premium is a sum of money that you will need to pay in order to avail the protection that is accorded by the policy. There are several factors that the insurer will take into consideration before determining your premium. Listed below are the policy tenure options and the premium payment mode.
|Premium Payment Mode||Single Premium|
*Premiums vary based on age, location, plan term, GST, and other factors.
|Death Benefit||If the life assured passes away within the first 5 years of purchasing the policy, the entire sum assured will be paid to the nominee. If the life assured passes away after the first 5 policy years, the sum assured along with loyalty additions will be paid.|
|Survival Benefit||Survival benefits payable will vary as per the policy tenure.
|Maturity Benefit||The single premium paid while purchasing the policy and loyalty additions will be paid as the maturity benefit, if the life assured survives till the end of the policy term.|
No additional riders can be purchased by the policyholder in order to increase the protection accorded by the base policy.
The New Bima Bachat Plan has a suicide exclusion. If the life assured commits suicide within 1 year of buying the policy, the insurer will return 90% of the premium paid to the nominee. No other benefits will be payable and the risk cover will cease.
|Cooling-Off/Free-Look Period||If the policy buyer is not satisfied with the terms and conditions that are mentioned in the policy document, he/she can return the policy within 15 days of purchasing it. The single premium paid while purchasing the policy will be returned to the policy buyer.|
|Surrender Value||The insurer will pay the life assured the higher of the Guaranteed Surrender Value or the Special Surrender Value, if the policyholder surrenders the policy. The Guaranteed Surrender Value payable during the first policy year is 70% of the Single Premium amount. Thereafter, the Guaranteed Surrender Value will be 90% of the Single Premium amount.|
|Policy Loan||Policyholders can avail a loan after the completion of a minimum of 1 policy year. The maximum loan amount permissible is 60% of the surrender value of the policy.|
|Rebate||Individuals who choose a high sum assured may be eligible to receive a rebate from the insurer.
|Loyalty Additions||Loyalty Additions will be based on the company’s experience, and will be paid with the death benefit (after completion of 5 years) or with the maturity benefit.|
Policyholders are eligible to receive tax rebates under Section 80C and Section 10(10D) of the Income Tax Act, 1961, for the premiums that pay and the benefits received by them. However, one must consult a tax advisor, since tax laws are subject to change without prior notice.
The New Bima Bachat Plan from LIC provides policyholders a comprehensive cover against death. The death benefit payable in case of the life assured’s death can protect one’s dependents from going through financial hardships. In addition, this plan also guarantees survival benefits at certain pre-defined intervals and a maturity benefit with the addition of loyalty additions at the end of the policy tenure. These payouts can go a long way in helping you secure your dependents.
LIC of India is one of largest and most preferred life insurance firms in the country. The company was established in the year 1956 to make insurance products accessible across India, and to rural India in particular. The company has been a market leader in the segment over the past years. With regards to the claim settlement ratio, the insurer reported a claim settlement ratio of 98.33% for FY15-16. The company has also been felicitated with several awards through the years.
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