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LIC Jeevan Labh Plan ( Table number: 836)
Jeevan Labh is one of the bestselling endowment insurance plans offered by LIC (Life Insurance Corporation of India). Rated alongside some of the best endowment insurance plans available for Indian insurance seekers, this non-market linked, with profit plan comes packed with a host of benefits for the policy holders. Available to anyone, in the age group of 8-59 years, this limited premium paying endowment policy ensures both death and maturity benefits for the policyholders and their nominees. The benefits are paid out, to the policyholders or nominees, in the form of sum assured and vested bonuses, if any, upon death of maturity.
LIC Jeevan Labh Plan - Key Features
Let’s check out some of the key features of this limited premium paying plan.
- The limited premium paying feature of this plan ensures that the policyholder pays lesser premium, for policy term than maturity.
- This plan is available for a policy term of 16, 21 and 25 years making goal-based investment easier for investors.
- This non-linked, with profit plan ensures both comprehensive protection plus assured returns for the investors in the form of death and maturity benefits.
- Policyholders can avail loan facility on this plan, after paying regular premium for three years.
- The pan comes packed with helpful add-on riders for policy holders. These riders are disability benefit rider and term assurance rider and are subject to extra premium payment.
- Tax benefits, under the Section 80C of the Indian income tax act, are available for the premiums paid by the policyholders.
- In addition to the premium payments, policyholders get to enjoy tax benefits on the maturity amount under the section 10(10D) of the Indian income tax act.
LIC Jeevan Labh Plan – Benefits
As discussed above, LIC Jeevan Labh plan offers both death and maturity benefits. Now, let’s discuss these benefits in details.
- Maturity Benefit: If a policyholder survives the term of the policy, then he/she is paid out the maturity benefit in the form of sum assured plus simple revisionary bonuses and final additional bonuses, if any.
- Death Benefit: In the event of the death of the policyholder during the term of the policy, his/her nominees are paid the death benefit in the form of sum assured on death plus simple revisionary bonuses plus final additional bonuses, if any. Remember, these benefits are paid out only if all the premiums are paid-up.
LIC Jeevan Labh – Coverage
Now that we know the benefits offered by Jeevan Labh plan, let’s discuss the extent of coverage provided by this brilliant endowment plan from LIC.
Death Benefit – Upon the death of the life insured, his/her nominees are paid out:
- Sum Assured. Death Sum Assured is not less than 105% of all premiums paid.
- Vested Simple Reversionary Bonus. This bonus is the higher of 10 times the annualized premium, or Basic Sum Assured. And,
- Final Additional bonus (if any)
Maturity Benefit – Upon maturity of the plan (if the life insured survives the policy term), the life insured is paid out:
- Sum Assured on Maturity. This amount is equal to the basic sum assured. Plus,
- Vested Simple Reversionary Bonus. And,
- Final Additional Bonus (if any).
LIC Jeevan Labh - Eligibility Criteria
Let’s check out the eligibility criteria of LIC Jeevan Labh Endowment plan.
|
Entry Age (in years) |
Minimum: 8 (Completed) |
|
Sum Assured (in rs.) |
Minimum - 2,00,000 |
|
Maturity Age (in years) |
Minimum – NA Maximum - 75 |
|
Policy Term (in years) |
16/21/25 |
|
Premium Paying Term (in years) |
10 (for 16 years PT) 15 (for 21 years PT) 16 (for 25 years PT) |
LIC Jeevan Labh –Riders
There are two main add-on riders available with LIC Jeevan Labh. These riders are:
- Disability Benefit Rider: LIc Jeevan Labh policy offers comprehensive protection against accidental death and disability to the policyholders and their nominees in the form of disability benefit rider. This add-on cover is available at an additional premium payment. This rider is only available to those over 18 years of age.
- New Term Assurance Rider: This is yet another brilliant add-on cover that has been carefully conceptualized and introduced by LIC to ensure comprehensive financial protection for the nominees of the life insured. Upon the death of the policyholder, during the term of the policy, an additional amount equivalent to term assurance rider sum assured is paid out to the nominees. However, the term assurance rider sum assured is only paid out if the rider cover is in effect. Also, the maximum coverage amount provided under term assurance rider is Rs.25 lakhs.
LIC Jeevan Labh - Surrender Value
LIC Jeevan Labh Plan acquires a surrender value if the premiums are paid for three full policy years and the policy stays in effect for these 3 years. Here’s what paid out as the surrender value:
- Guaranteed Surrender Value: The guaranteed surrender value is equal to the percentage of the total premium payments. The percentage of total premium is calculated excluding the net of taxes, extra premiums paid and any extra rider premiums paid. This percentage depends upon the policy term selected by the policyholder and the policy year when the plan is being surrendered.
Guaranteed surrender value also includes the surrender value of the simple revisionary bonuses, if any. Here the surrender value is equal to the vested bonuses multiplied by the related surrender value factors.
- Special Surrender Value: Special surrender value is paid out to the life insured upon surrender of the policy, only if the special surrender value is more than the guaranteed surrender value. It is calculated as the discounted value of the sum of the vested bonuses and the maturity paid-up sum assured.
LIC Jeevan Labh – Rebates
LIC is known to offer multiple rewards to its policy holders in the form of rebates. Under this plan, rebates are given to the policyholders in the following ways:
Rebate on Premium Payment Mode: Policyholders are given rebates on the basis of premium payment modes selected by them, under LIC jeevan Labh plan. These rebates are:
- 2% of the table premium is offered as rebate to those with yearly premium payment mode.
- 1% of the table premium is offered as rebate to those with half-yearly premium payment mode.
Rebate on Sum Assured: Just like premium payment modes, policyholders are also offered rebates on the basis of the sum assured chosen by them.
- For sum assured between Rs.5,00,000 and Rs.9,90,000, 1.25% of the basic sum assured per Rs.10000 of basic sum assured is offered as rebate.
- For sum assured between Rs.5,00,000 and Rs.9,90,000, 1.50% of the basic sum assured per Rs.10000 of basic sum assured is given as rebate.
- For sum assured between Rs.15,00,000 and above, 1.75% of the basic sum assured per Rs.10000 of basic sum assured is given as rebate.
LIC Jeevan Labh – Income Tax Benefits
Like most other plans offered by LIC, Jeevan Labh also offers a host of income tax benefits to the policyholders to maximize their savings and minimize their tax liabilities.
- Income Tax Benefits on Premium Payments –Policyholders can avail tax benefits under the Section 80C of the Income Tax Act for the premium payments made for the LIC Jeevan Labh Plan.
- Income Tax Benefits on Maturity Amount – The maturity proceeds of the LIC Jeevan Labh plan are tax-free under the section 10(10D) of the Income Tax Act, 1961.
LIC Jeevan Labh – Grace Period & Free-look Period
- Grace Period – Policyholders are granted a grace period of 30 days on non-payment of the unpaid premium for those with yearly, half-yearly, and quarterly premium payment modes. However, the grace period is cut short to 15 days in case a policyholder has selected monthly premium payment mode.
- Free Look Period: LIC Jeevan Labh plan provides a free-look period of 15 days from the date of receiving policy documents.
LIC Jeevan Labh –Exclusions
If the policyholder commits suicide within one year from the insurance coverage commencement date, the insurance policy will be cancelled and no benefits will be paid out to the nominees of the life insured. However, the plan ensures that 80% of the premiums paid, without any interest, are returned to the nominees, in the event of the life insured committing suicide within one year of the insurance coverage commencement.
LIC Jeevan Labh –FAQs
Q 1: What happens if I am not able to pay the premiums within the grace period?
Ans: In such an event, the policy will lapse. However, you can always renew the policy within two consecutive years, from the date of first unpaid premiums, by payment of all unpaid dues with interest. Remember, LIC compounds interests semi-annually.
Q 2: Will my policy be cancelled if I pay the premiums for three years but not after that?
Ans: In such an event, your policy will not be cancelled. However, it will continue as paid-up policy and the death or maturity benefits will be reduced accordingly.
Q 3: Will I get any benefits if I surrender my policy?
Ans: If you have completed three full policy years and have paid timely premiums for three full years, you are liable to get surrender benefits of the policy (as discussed above).
Q 4: Can I get a loan against my policy?
Ans: Yes! You can get a loan against your policy. However, you can avail this facility only after regular premium payment for three full years, subject to terms and conditions.
Q 5: Do I get income tax benefits if I buy this plan?
Ans: Yes! You can avail income tax benefits on the premium payments under Section 80C and on the maturity proceeds under section 10(10D) of the income tax act.
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