Best Life Insurance Corporation of India (LIC) Plans 2018-19

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Life Insurance Corporation of India or LIC is a state-owned life insurance company that was established in the year 1956. The objective of the company is to provide life insurance to citizens all over the country including the rural areas. The focus is on the socially and economically challenged backward classes to receive optimum financial protection against death. The insurer offers a variety of plans such as term insurance plans, ULIPs, money back plans, online plans, etc.

The company has over 2048 branch offices throughout the country which makes it easily accessible for all policyholders and claimants. LIC has had a long-standing reputation for having the highest claim settlement ratio out of all the life insurance companies in the country. In the year 2016-17, the claim settlement ratio was 98.31%. In the same year, the company received a whopping 27 awards.

1. LIC New Jeevan Anand Plan (Endowment plan)

The New Jeevan Anand plan is a non-linked participating endowment plan that offers the double advantage of protection as well as savings. While the plan assures a death benefit in case the life assured passes away during the policy term, a maturity benefit is payable in case the individual survives the complete term.

Eligibility and other details:

Minimum age at entry	18 years
Maximum age at entry	50 years
Maximum maturity age	75 years
Minimum policy term	15 years
Maximum policy term	35 years
Minimum basic sum assured	Rs.1 lakh
Maximum basic sum assured	No limit
Premium payment modes	Monthly, quarterly, half-yearly, yearly

Death benefit: Upon the death of the life assured during the policy term, the death benefit payable is equal to the sum assured on death plus reversionary bonus and final additional bonus, if any. The sum assured on death is essentially the higher amount of 125% of the sum assured or 10 times the annual premium. Upon the death of the individual after the completion of the term, the basic sum assured is paid to the nominee as the death benefit.

Maturity benefit: As the maturity benefit, the basic sum assured plus simple reversionary bonus and final additional bonus, if any, are payable at the end of the policy term.

Surrender benefit: The policyholder can choose to surrender the policy after completion of 3 years. The guaranteed surrender benefit payable will be a certain percentage of the premium amount paid. The percentage depends on the policy term chosen and the year when the policy was surrendered. Additionally, reversionary bonuses, if any, will also be payable along with the guaranteed surrender benefit.

Optional benefit

LIC’s Accidental Death and Disability Benefit Rider: This is a rider that pays an additional lump sum amount along with the death benefit in case the life assured expired due to an accident. Further, if the individual suffers a permanent disability due to an accident, the accident benefit sum assured is paid as monthly instalments for 10 years and all future premiums of the policy are waived off. The rider can be availed by paying an extra premium as mentioned in the policy.

The LIC New Jeevan Anand Plan offers rebates on premiums (yearly/half-yearly modes) and sum assured amounts above Rs.2 lakh. Loans can be availed from the policy if the policy has acquired a surrender value. The policy participates in the profits of the company and the policyholder is eligible to receive reversionary bonuses during the policy term.

2. LIC New Children Money Back Plan (Money Back plan)

This is a non-linked participating money back plan that helps parents/grandparents manage the financial requirements of the child such as educational needs, marriage needs, and so on. The survival benefits offered by the plan on a regular basis will prove to be helpful for such reasons.

Eligibility and other details:

Minimum age at entry	0 years
Maximum age at entry	12 years
Minimum/Maximum maturity age	25 years
Policy term	(25 – age at entry) years
Minimum basic sum assured	Rs.1 lakh
Maximum basic sum assured	No limit
Premium payment modes	Monthly, quarterly, half-yearly, yearly

Death benefit: On the death of the life assured, the sum assured on death plus final additional bonus and simple reversionary bonus, if any, shall be payable to the nominee as the death benefit. The sum assured on death will be the higher amount of absolute sum assured payable on death or 10 times the annual premium. In case the death occurs before commencement of risk, all premiums paid will be returned, excluding extra premium, rider premium, and taxes.

Maturity benefit: If the life assured survives the complete term of the policy, the sum assured on maturity i.e. 40% of the basic sum assured will be payable along with simple reversionary bonus and final additional bonus, if any.

Survival benefit: Provided the policy is in full force, if the policy anniversary coincides or follows the completion of 18 years, 20 years, and 22 years of the individual, 20% of the basic sum assured is payable on each of the above-mentioned years.

Optional benefit

• Option to defer survival benefits: The policyholder can choose to receive the survival benefit any time on or after the due date. In a case where the survival benefit has been deferred, the company will pay an increased survival benefit.
• LIC‘s Premium Waiver Benefit Rider: In case the proposer of the policy passes away, the premiums payable for the rest of the policy term will be waived off. This rider can be added on to the basic plan by paying an additional premium.

Rebates are offered on the yearly and half-yearly modes of premium and for sum assured amounts equal and above Rs.2 lakh. The policyholder has the option to borrow a loan from the policy, provided the policy has acquired a surrender value. The policy participates in the profits of the company and the policyholder is eligible to receive reversionary bonuses during the policy term.

3. LIC e-Term (Term plan)

LIC e-Term is a non-participating term insurance plan that offers financial protection to the life assured’s family against his/her risk of death. The specialty of this plan is that it can be bought online with just a few simple clicks. Differential premium rates are offered for smokers and non-smokers.

Eligibility and other details:

Minimum age at entry	18 years
Maximum age at entry	60 years
Maximum maturity age	75 years
Minimum policy term	10 years
Maximum policy term	35 years
Minimum basic sum assured	Rs.25 lakh for aggregate category; Rs.50 lakh for non-smoker category
Maximum basic sum assured	No limit
Premium payment modes	Yearly

Death benefit: If the life assured individual expires during the policy term, the sum assured is paid to the nominee as a death benefit.

Maturity benefit: No maturity benefit is payable under this policy type.

In a motion to incentivise digital payments in public sector insurers, the government has offered certain discounts on the premium amounts payable for the first five policy years. The discounts offered on the premiums are as follows:

• First year premium - 8%
• Second year premium - 6%
• Third year premium - 4%
• Fourth year premium - 2%
• Fifth year premium - 2%

The amount of discount offered is limited to Rs.3,000 per year.

4. LIC’s Jeevan Labh (Endowment plan)

This is a non-linked, participating, limited premium paying endowment plan that offers the benefit of savings along with the basic function of protection. The policyholder’s family is promised a lump sum amount in case the individual passes away during the policy term. In the event that the life assured survives the term, he/she is provided with a benefit.

Eligibility and other details:

Minimum age at entry	8 years
Maximum age at entry	59 years for 16-year policy term 54 years for 21-year policy term 50 years for 25-year policy term
Maximum maturity age	75 years
Minimum policy term	16 years
Maximum policy term	25 years
Minimum basic sum assured	Rs.2 lakh
Maximum basic sum assured	No limit
Premium payment modes	Monthly, quarterly, half-yearly, yearly

Death benefit: As mentioned earlier, if the life assured individual faces death during the tenure of the policy, the nominee of the policy is provided with a death benefit along with reversionary and final additional bonuses, if any. The death benefit or the sum assured on death is the higher amount - 10 times the annual premium or the total sum assured payable on death. The benefit cannot be less than 105% of the total premium amount paid.

Maturity benefit: On survival till the date of maturity, the policyholder is provided with the basic sum assured plus final additional bonus and simple reversionary bonus, if any, provided all premiums have been duly paid.

Surrender benefit: If the policyholder chooses to surrender the policy, he/she is given a surrender benefit. The surrender benefit is equal to the guaranteed surrender value which is a certain percentage of the total premium amount paid. In addition to the guaranteed surrender value, simple reversionary bonuses, if any, are payable. Further, the company may pay a special surrender value to the policyholder if that is found to be more favourable to him/her. Hence the higher amount - guaranteed surrender value or special surrender value is provided to the policyholder on surrender of the policy.

Optional benefit:

• LIC’s Accidental Death and Disability Benefit Rider - A policy that has this rider attached to it will be required to pay an additional predetermined amount to the beneficiary of the policy if the death of the life assured was caused by an accident. On the other hand, if an accident caused disability of the insured individual, equal monthly payouts are payable to him/her for a period of 10 years and all future premiums are waived off. A policyholder who opts for this rider will be required to pay a nominal additional premium.
• LIC’s New Term Assurance Rider - The Term Assurance Rider is required to pay the Term Assurance Rider Sum Assured to the nominee if the individual passes away during the term of the rider. An additional amount is to be paid if an individual wishes to enjoy benefits under this rider. This particular rider can be attached only to non-linked policies.

Persons who purchase the LIC Jeevan Labh policy enjoy a 2% rebate on the yearly premium and 1% rebate on the half-yearly premium. Also, high sum assured amounts i.e. amounts above Rs.5 lakh are given rebates. Through the loan facility, the policy helps manage one’s liquidity needs. Loans can be borrowed from the policy only if the policy has acquired a surrender value. The policy participates in the profits of the company and the policyholder is eligible to receive reversionary bonuses during the policy term.

5. LIC’s New Money Back Plan - 25 years (Money Back plan)

LIC’s New Money Back Plan - 25 years is a non-linked participating plan that provides protection against death and also provides periodic payments in case he/she survives the term. This unique combination is beneficial to the policyholder as well as his/her family.

Eligibility and other details:

Minimum age at entry	13 years
Maximum age at entry	45 years
Maximum maturity age	70 years
Policy term	25 years
Minimum basic sum assured	Rs.1 lakh
Maximum basic sum assured	No limit
Premium payment modes	Monthly, quarterly, half-yearly, yearly

Death benefit: Upon death of the life assured person, an amount known as the sum assured on death is paid to the nominee of the policy. This amount is defined as the higher amount of - 125% of the basic sum assured or 10 times the annual premium. The death benefit so calculated cannot be less than 105% of the total premium amount paid.

Survival benefit: If the individual survives the 5th policy year, 10th policy year, 15th policy year, and the 20th policy year, 15% of basic sum assured is provided at the end of each of the above-mentioned policy years.

Maturity benefit: If the life assured survives the complete policy term i.e. until the end of the 25th policy year, 40% of the basic sum assured along with final additional bonus or simple reversionary bonus, if any, is payable as the maturity benefit.

Surrender benefit: If the policy is surrendered to the insurer, a surrender benefit which is the higher of the guaranteed surrender value and the special surrender value is payable to the individual. The guaranteed surrender value is a certain percentage of the total premium amount paid. The percentage depends on which policy year the policy is surrendered. In addition to the guaranteed surrender value, a simple reversionary bonus, if any, is payable. The special surrender value, on the other hand, is an amount decided by the insurer that is more favourable to the policyholder.

Optional benefit:

• LIC’s Accidental Death and Disability Benefit Rider - In case of accidental death of the life assured, an additional sum under this rider is paid along with the death benefit of the base plan. In case of accidental disability, equal monthly instalments are provided to the policyholder for a period of 10 years. This rider can be availed by paying an additional premium.

Policyholders enjoy premium rebates on certain premium payment modes. A 2% rebate is offered on the yearly mode and 1% is offered on the half-yearly premium payment mode. Policies with sum assured amounts more than Rs.2 lakh qualify for certain rebates too. Individuals are permitted to borrow loans from the policy after it has acquired a surrender value. The policy participates in the profits of the company and the policyholder is eligible to receive reversionary bonuses during the policy term.

Note - The above list was created keeping in mind the benefits offered. Each of the products offered by LIC has been designed for specific purposes. Prospective policy buyers are requested to pick the policy that best suits his/her requirement.