LIC Bonus Rates For 2021-22

LIC, India’s largest insurance company, announced various types of bonuses to add to the final benefits offered by their plans. These bonuses are declared on 1st September every year. For the financial year 2021-22, LIC declared the latest bonus rates as per the valuation done on 31st March 2021. 

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LIC Bonus Rates

As incentives for buying its policies, the Life Insurance Corporation of India (LIC) started adding bonus amounts to the death and maturity benefits. These significantly increased the final payouts of the plan, meaning that policyholders could now enjoy larger savings.

Some important things to know about LIC bonus rates are:

  • Only policyholders of LIC participating plans are entitled to these extra additions by way of sharing in the profits of the company.

  • The profits are shared in the form of bonuses or dividends which are paid out annually at the time of maturity or with the death benefit.

  • The bonus offered is not guaranteed or constant throughout the complete policy term and depends on multiple factors.

Factors that Affect Bonus Ratesin LIC

  • Choice of Policy – The valuation for each applicable policy is done separately, therefore, the rates vary across them.

  • Policy Term – There is a time benefit that comes with a longer policy term. The higher the term, the higher the bonus rate.

  • Sum Assured – If you buy a policy of high sum assured, then the bonus accumulation will also be on a higher side.

Types of Bonuses in LIC 2021-22

Here are the different types of bonuses offered by LIC.

  1. Simple Reversionary Bonus - SRB

    It is a vested bonus in LIC that is announced by the insurer every year. The SRB accrues over the years and the accumulated sum is added to the plan account. The simple reversionary bonus declared by LIC is available to the life assured at the time of death and maturity. If a policyholder wants to surrender the policy, only a part of the whole accumulated bonus will be provided based on the surrender charge offered at that period.

  2. Final Additional Bonus – FAB

    The LIC Final Additional Bonus is paid along with the SRB announced and then, added to the account of the policy. It is a one-time addition to the death and maturity benefit.

  3. Loyalty Additions

    These additions are payable only once during the policy term on the condition that the policyholder continues with the policy for a specified duration. Plans that offer loyalty additions generally do not come with SRB. Further, it is only offered when one exits the policy by way of death, maturity, or surrender.

Calculation of LIC Bonus Rate 2021-22

For example, you buy aLIC policyto enjoy coverage for 21 years and assure a basic sum of Rs.10 Lakhs. The bonus rate on a product is Rs.45 per 1000 of the sum assured, then the calculation will be as follows -

Total Bonus for 21 years = (10,00,000 X 45/1000) X 21 = Rs.9,45,000

This brings the final maturity amount to Rs.19,45,000.


LIC Bonus Rates for 2021-22

LIC bonus rates for 2020-21 were last declared as per the company's valuation in March 2021. The below table of reversionary bonus rates is only applicable for policies that are in force for the complete sum assured as of 31st March 2021. These rates are applied to the policies that result in claims by maturity/ death or surrendering the policy on or after 31st March 2020.

Let’s discuss the bonus rates of some of the active LIC insurance plans:

LIC Bonus Rates As Per the Evaluation on 31st March 2021 - Active Plans
Sl No. Plan Policy Term in years Bonus Rates (Per 1000/- SA)**
SA less than 1 lakh SA more than 1 lakh
1 LIC New Endowment Plan - 914 12 to 15 34 35
16 to 20 38 39
>20 44 45
2 LIC New Jeevan Anand Plan - 915 15 37 38
16 to 20 41 42
> 20 45 46
3 LIC New Money Back Plan 20 Years - 920 20 35 36
25 40 41
4 LIC New Money Back Plan 25 Years - 921 20 35 36
25 40 41
5 LIC Single Premium Endowment Plan – 917 10 to 15 37 38
16 to 20 42 43
> 20 47 48
6 LIC Jeevan Lakshya - 933 13 to 15 37 38
16 to 20 41 42
> 20 45 46
7 LIC New Children Money Back Plan – 932 13 to 15 34 35
16 to 20 38 39
> 20 44 45
8 LIC Jeevan Labh - 936 16 - 40
21 - 44
25 - 47
9 LIC Jeevan Tarun - 934 13 to 15 34 35
16 to 20 38 39
>20 44 45
10 LIC Jeevan Umang - 945 PPT - 15 Age up to 55 – 48
Age 56 to 70 – 57
Age 71 to 85 – 64
Age 86 to 100 – NA
PPT - 20 Age up to 55 – 47
Age 56 to 70 – 52
Age 71 to 85 – 59
Age 86 to 100 – 67
PPT - 25 Age up to 55 – 46
Age 56 to 70 – 47
Age 71 to 85 – 53
Age 86 to 100 – 62
PPT - 30 Age up to 55 – NA
Age 56 to 70 – 46
Age 71 to 85 – 47
Age 86 to 100 – 57

Here are a few plans that are now withdrawn but can still earn the LIC bonus rate 2021-22.

LIC Bonus Rates As Per Valuation on 31st March 2021 – Withdrawn Plans
Sl No Plan Policy Term in years Bonus Rates (Per 1000/- SA)**
SA less than 1 lakh SA more than 1 lakh
1 Whole Life Type Plans (2, 5, 6, 8, 10, 28 - before conversion, 35, 36, 37, 38, 49, 77, 78, 85 & 86) NA 65 66
2 Endowment Type Plans (14, 17, 27 - after conversion, 28 - after conversion, 34, 39, 40, 41, 42, 50, 54, 79, 80, 81, 84 , 87, 90, 91, 92, 95, 101, 102, 103, 109, 110 & 121) < 11 29 30
11 to 15 33 34
16 to 20 37 38
> 20 43 44
3 Money Back Plans (75 & 93) 20 34 35
25 39 40
4 Jeevan Surabhi Plans (106,107 & 108) 15 29 30
20 36 37
25 45 46
5 Jeevan Mitra - Double Cover and Jeevan Saathi Plan (88 and 89) < 16 35 36
16 to 20 39 40
> 20 43 44
6 Jeevan Mitra Plan - Triple Cover Plan (133) < 16 35 36
16 to 20 40 41
> 20 45 46
7 LIC Child Career Plan - 184 11 to 15 29 30
16 to 20 33 34
> 20 35 36

Wrapping It Up!

LIC recently announced the bonus rates for 2021-2022 based on its surplus funds in the previous year. Along with the 3 types discussed, some policies come with bonus guaranteed additions to the basic sum assured. Unlike SRB, the rate of guaranteed additions remains constant throughout the policy term, irrespective of its valuation in a financial year.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
^Trad plans with a premium above 5 lakhs would be taxed as per applicable tax slabs post 31st march 2023
+Returns Since Inception of LIC Growth Fund
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
++Returns are 10 years returns of Nifty 100 Index benchmark

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