The Whole Life Policy – Limited Payment from Life Insurance Corporation of India (LIC) is a “with-profit”, limited premium payment, whole life insurance plan. Under this policy, you can pay the due premium for a limited period of time and continue to enjoy the risk cover and benefits accorded by the policy throughout the policy tenure. Policyholders can also opt for additional covers or add-ons at the time of purchasing the policy by paying an extra premium. The life assured will be eligible to claim tax rebates under Section 80C and Section 10(10D) of the Income Tax Act, 1961.
Insurers usually set an eligibility criteria which will have to be met by any individual looking to purchase an insurance policy.
|Parameters||Criteria for eligibility|
|Minimum age at entry||12 years|
|Maximum age at entry||60 years|
The sum assured amount is a pre-decided amount of money that the insurance company is liable to pay to the policyholder/nominee, when the eventuality occurs. This is the minimum guaranteed amount, before the inclusion of any additions or bonuses.
|Minimum Sum Assured||Rs.50,000|
|Maximum Sum Assured||No limit|
The premium is the amount of money that you will have to pay to the insurance firm for the policy. Policyholders must ensure to pay the premiums regularly as per the premium payment mode to keep the policy running.
|Minimum term of the policy||5 years|
|Maximum term of the policy||55 years|
|Maximum Premium Paying Period||Premium Payment Term of 40 years or 80 years of age, based on whichever occurs later|
|Premium Payment Mode||
|Premium Amount||Will vary on the basis of the sum assured, policy tenure, age at entry, riders opted for, etc.|
*Premiums vary based on age, location, plan term, GST, and other factors.
|Death Benefit||If the life assured passes away during the policy term, the insurer will pay the guaranteed sum assured and all bonuses as a lump sum amount to the nominee.|
|Maturity Benefit||This policy does not have an exact date of maturity. However, the life assured has the option of availing the sum assured amount and all payable bonuses at any time after the 40th policy year, provided they have attained the age of 80 years.|
At the time of purchasing the policy, the policy buyer can opt for additional riders or add-ons to customise this policy. The policy buyer will have to pay an additional premium to avail the benefits provided by the rider/add-on.
Other Key Features – Loan, Surrender Value, etc.
|Surrender Value||Policies that have been running for a minimum of 3 years can be surrendered to the insurer. The insurer will pay the policyholder the Guaranteed Surrender Value, after the policy is surrendered. The insurer may decide to pay the Special Surrender Value instead, if it is higher or equal to the Guaranteed Surrender Value amount.|
|Paid-Up Benefits||If the policyholder has paid all due premiums for a period of 3 years and has missed the following premium payment, the policy will be converted into a paid-up policy with the corresponding benefits. No bonus will be paid for paid-up policies.|
|Loan||Policyholder have the option of availing a loan against this policy.|
Life insurance policies serve as an effective tax saving instrument, in addition to the many benefits they provide. Policyholders/nominees can claim tax benefits, up to the predefined limits, under Section 80C and Section 10(10D) of the Income Tax Act, 1961. Since the prevailing tax laws can change from time to time, it is best to consult a tax advisor.
As the name suggests, LIC’s Whole Life Policy – Limited Payment offers the policyholder a risk cover for an extended period of time, thus providing you and your dependents financial security, regardless of what may happen in the future. Since the policyholder is also given the option to avail a loan against this policy, it can also be of help in case one is in need of emergency liquidity.
Life Insurance Corporation of India (LIC) is one of the oldest insurance firms in the country. They are well-established, having been nationalised in the year 1956. Since their inception, the insurer has won several awards for their revolutionary services. They have set many milestones in the life insurance sector. The insurer has reported a high claim settlement ratio of 98.33% for FY15-16 and a Grievance Resolved Ratio of 100% for the same period. LIC offers a diverse range of plans, thus catering to the needs of their customers.
Note: This plan has been withdrawn by LIC.