Life insurance is an arrangement between the insurance company and the person who has taken insurance. As per the agreement, the corporation givs a lump sum to the nominee who has been chosen by the insured person should the insured person meet an untimely death.
This policy protects the family and the loved ones who are financially dependent on the insured. The insured has to pay a small amount for a specific period of time which is known as premium and the company pays the lump sum amount to the family of the insured person in case there is a mishap. This payment includes the sum assured- this is the amount spent to purchase the policy and the minimum amount of money that the company will pay before adding bonuses.
A life insurance policy provides maturity benefits in the form of pay-outs should the policyholder survive the entire term of the policy apart from death benefit. Life insurance policy provides tax benefits as well.
The insurance provider decides the amount that has to be paid as premium. The customer can choose the sum assured and the term of the policy. The sum assured determines the premium that needs to be paid.
Life Insurance Corporation of India has many policies and the customer can choose amongst those as per individual requirements. One of them is the LIC Jeevan Lakshya Endowment Plan.
LICs Jeevan Lakshya Endowment Plan
This plan of LIC- Jeevan Lakshya was introduced in March 2015 and is a limited paying premium conventional plan classified as the with-profit assurance endowment plans. It gives annual income benefit to fulfil the needs of the family if the insurer passes away during the term of the plan. This plan is great for minors. A lump sum amount is paid at the time of maturity regardless of survival of the policyholder. This plan looks after liquidity needs through its loan facility.
Highlights of LICs Jeevan Lakshya
- The minimum sum assured is Rs 1, 00,000 and there is no maximum limit.
- The term of the policy is 13 to 25 years
- Premium can be paid monthly, quarterly, half yearly or on yearly basis. The premium can be paid through ECS or Electronic Clearing Service.
- The premium paying term is 3 years regardless of the tenure of the policy.
- The minimum eligibility age for the policy is 18 years and the maximum eligibility age is 50 years
- The maximum age of maturity of the policyholder is sixty-five years.
- This is a with profit assurance endowment plan, so this policy acquires profits achieved by the Life Insurance Corporation of India through Reversionary Simple Bonus and Additional Final bonus and these are waged out at the conclusion of the period of maturity.
- There are two optional riders in this policy
- LIC’s Disability and Accidental Death Benefit Rider
- LIC’s New Term Assurance Rider
Rider Sum Assured cannot be more than the basic sum assured.
Advantages of the LIC Jeevan Lakshya Policy
Some of the advantages of this policy include
If the policy holder has paid all the premiums and has lived till the end of the policy term then the maturity benefit will include the sum assured on maturity plus along with the Simple Reversionary Benefits and the Final Additional bonus if there is any. The sum assured on maturity is same as the basic sum assured.
If the policy holder dies within the term of the policy, a sum assured along with Simple Reversionary Bonuses and the Final Additional Bonus (if applicable) will be provided.
The premium paid under this plan can get concession on annual income tax. According to section 10 D the maturity amount is not taxed.
LIC’s Jeevan Lakshya policy is based on simple regulations and rules and there are no exclusions if all the criteria have been met.
There is a suicide clause for Jeevan Lakshya policy. If the life assured commits suicide in the year from the date of the commencement/risk then 80% of the single paid premium (taxes excluding) and extra premium (if any) will be returned.
Other Information about LIC Jeevan Lakshya
Paid Up Value
The policy gets a Paid-up value if premiums have been paid for at least three successive years and further premiums haven’t been given. The Maturity Assured Sum and Death Assured Sum will be a multiple of a fraction of the number of premiums paid and the number of premiums payable.
Surrender Value of LIC Jeevan Lakshya
If the policy is surrendered after paying premiums for at least three years then it gets a guaranteed surrender value. It is a percentage of the total premiums paid till that date.
Reviving the Policy
The LIC Jeevan Lakshya can be reinstated if lapsed. The condition is that it should be less than two consecutive years since the date of the last unpaid premium.
Loan on the Policy
A loan can be sought on the policy, if three years of premiums have been paid.