LIC New Endowment Plan

*Please note that the quotes shown will be from our partners

The Life Insurance Corporation of India is known as the pioneer of insurance in India. With its wide customer base the LIC is one of the most trusted brand in the insurance sector. The Life Insurance Corporation of India offers wide range of insurance products available in most affordable premium rates. With its expert customer support service the LIC of India helps you to get the best insurance policy as per your requirements and suitability. One can choose from the array of plans like protection plan, child plan, retirement plan, ULIP plan, endowment plan, saving plan, group plan, retirement plan, etc.

Further in this article we are particularly going to talk about LIC New Endowment Plan but, before that let’s give some insight on various endowment policies offered by the Life Insurance Corporation of India.

LIC Endowment Plans

Endowment plan offered by LIC are:-

  1. Single Premium Endowment plan- This plan is a single premium payment plan that provides no limit on the maximum sum assured amount. Moreover, the policy also offers guaranteed surrender value along with the death benefit and maturity benefit.
  2. LIC New Jeevan Anand- This plan is a saving cum protection plan that provides you an opportunity to save ample amount so that you can fulfill your future financial goals. Moreover, it also provides life protection to the family of the insured.
  3. LIC Jeevan Rakshak-  This plan             does not offer any limit on the maximum sum assured amount. At the time of maturity the plan offers revisionary bonus and final addition bonus to the policyholder. Moreover, the policy also provides concession on the premium paid.
  4. LIC Jeevan Lakshya- This is a participating endowment plan that is specifically designed to fulfill the requirements of the children. Under this plan the beneficiary i.e. (the child) receives the total sum assured amount in case of demise of their parent. Thus, the plan ensures a proper financial support to the child so that he/she can accomplish the major milestones of life.
  5. Limited Premium Endowment Plan- This plan offers the minimum sum assured amount of Rs3 lakh where as there is no limit on the maximum sum assured amount. The policy can be availed in 3 tenures i.e. 12 years, 16 year and 21 years.

So, apart from LIC New Endowment plan this was the brief description about the LIC Endowment Plan. In addition to this further we will discuss elaborately about the features and benefits offered by LIC New Endowment Plan.

LIC New Endowment Plan

The endowment plan offered by LIC is a participating endowment plan that offers the dual benefit of protection cum saving plan. As a simple vanilla policy LIC endowment plan comes with both death and maturity benefit. Unlike pure term insurance plan LIC endowment plan is beneficial for those who want to have a disciplined saving long with life coverage.

The combination of saving cum protection provides financial cushion to the family of the deceased insurance holder during the tenure of the policy. Moreover, if the insurance buyer survives the entire tenure of the policy then he/she receives the lump-sum amount as maturity benefit at the time of policy maturity. Moreover, by providing loan facility, LIC Endowment Plan also takes care of the liquidity needs.

Key Features of LIC New Endowment Plan

  • This is a Participating Traditional Endowment Plan
  • Under this plan the policyholder requires to pay premium for the entire tenure of the policy.
  • LIC Endowment plan also offers surrender benefit and loan facility to fulfill the liquidity needs.
  • On survival till the end of the policy tenure, the maturity benefit is paid to the policyholder and the policy terminates
  • If the life insured dies within the policy tenure, the death benefit is paid to the nominee and the policy terminates
  • LIC Endowment plan offers additional coverage as optional accidental death and disability benefit rider which can be opted for additional premium along with the basic coverage offered by the policy.
  • The entry age of the plan ranges from minimum 8 years to maximum 55 years.
  • The maximum maturity age of the policy is 75 years.
  • The premium of the policy can be paid in annual, half-yearly, quarterly and monthly mode.
  • The minimum sum assured of the policy is Rs1,00,000 whereas it has no upper limit on the maximum sum assured.
  • The premium paying tenure of the policy is equal to the tenure of the policy.

Benefits of New Endowment Plan

  • Participation in Profit: LIC Endowment Plan participates in the profits of the company and the policy accumulates Simple Reversionary Bonuses and Final Additional Bonus which is declared on the basis of the experience of the company.  Simple reversionary bonus is offered to the insured in case of death benefit or maturity benefit provided the policy has completed the certain minimum years.     
  • Maturity Benefit: If the policyholder survives the entire tenure of the policy then at the time of maturity of policy he/she will receive the basic sum assured amount along with accrued bonuses as maturity benefit and the tenure of the policy will lapse.
  • Death Benefit: In case of demise of the insured person during the tenure of the policy, the beneficiary of the policy receives death benefit as the total sum assured on death along with the simple reversionary bonus or accrued bonus and the tenure of the policy lapses. 
  • Sum Assured on Death is defined as higher of:
  • Basic Sum Assured as chosen at the beginning of the policy
  • 10 times of annualized premium
  • Subject to a minimum of 105% of the total premiums paid as on date of death
  • Accidental Death and Disability Benefit Rider: LIC Endowment Plan offers additional benefit as rider under which the policy provides add-on benefit along with the basic coverage to the beneficiary of the policy in case of accidental demise of the insured person. Under this rider benefit and extra sum assured amount is paid to the beneficiary of the policy along with the basic sum assured amount.
    • There is mode discount for yearly and half-yearly premium payments and for higher sum assured chosen by the policyholder.
    • The insured can save bundles on taxes as the premium paid and the maturity proceeds are eligible for tax deduction under section 80C and 10(10D) of Income Tax Act.

Product Specification:

 

Minimum

Maximum

Entry Age (Last Birthday)

8 years

55 years

Maturity Age (Last Birthday)

-

75 years

Policy Term (PT) in years

12 years

35 years

Premium Paying Term (PPT) in years

Equal to Policy term

Premium Paying Frequency

Annual, half-yearly, quarterly and monthly

Sum Assured

Rs 1, 00,000

No Limit

 

Details About Premium

The annual premium is mentioned in Rupees for a Policy Tenure of 20 years. Basic Premium is mentioned below (Tax not included)

Age

Rs 1 Lac Sum Assured

Rs 2 Lacs Sum Assured

Rs 5 Lacs Sum Assured

30 Years

5062

9723

23809

40 Years

5248

10096

24740

50 Years

5753

11105

27263

 

Policy Details

Grace Period: In case, the insurance holder fails to pay the premium on time then a grace period of 30 days is offered under the policy under which the insured can pay the due premium within the 30 days. If policyholder fails to make payment within the grace period then the policy lapses. However, there is a period of 2 years from the due date of the first unpaid premium for the policy to be revived.

Free Look Period: If you would not be pleased with the coverage, and terms and conditions of the policy, you have the option of canceling the policy within 15 days of receipt of the policy documents, provided there has been no claim.

Policy Termination or Surrender Benefit: The LIC New Endowment Plan also comes with a surrender values under which a particular percentage of premium amount is paid back to the insured in case he/she decides to surrender the policy after the completion of 3 policy years and can also avail Loan.

Exclusions

In case of suicide committed within 12 months of policy inception only 80% of premiums paid are returned to the nominee. In case of suicide within 12 months of revival, higher of 80% of premiums paid or acquired Surrender Value is paid

Documents Required

Policyholder has to fill up an ‘Application form/ proposal form’ with accurate medical history along with the address proof and other KYC documents. Medical examination may be required in some cases, based on the sum assured and the age of the person

Conclusion

 By reading the above mentioned features and benefits offered by the plan it is clear that the plan is best suited for those individual who wants to have a disciplined saving option along with the advantage of life cover. With the help of LIC New Endowment plan you can set your long term financial goals and start saving for it in a more planned manner.