LIC Jeevan Labh is an endowment policy that offers guaranteed support in the time of one’s need. In addition to the death benefit, the life assured can enjoy maturity benefits and bonuses. The paid-up policy option ensures that policyholders do not lose out on the entire benefit amount on non-payment of premiums.Read more
The plan offers a limited premium paying arrangement that allows the life assured some level of flexibility. Further, in the event of the life assured’s death, the assigned beneficiaries receive financial support that they can use to fund future needs.
A primary feature that makes it a popular option is the loan facility that can be availed by policyholders to fund financial emergencies. Flexible policy terms, premium paying terms, and benefit options make LIC Jeevan Labh one of the best-selling plans by LIC.
Death Benefit - Assigned nominees are entitled to receive the sum assured on death of the life assured. Further, the life assured also has the option to choose to receive this amount in monthly, quarterly, half-yearly, and yearly installments.
Maturity Benefit - The maturity benefit offered by this policy further entitles the life assured to receive the sum assured on maturity. This amount can also be received in installments on opting for the settlement option.
Rider Benefits - The life assured can enhance their protection under LIC Jeevan Labh cover through riders against accidental deaths, disability, and critical illnesses.
Bonuses - Owing to the participating nature of the policy, it entitles policyholders to a percentage of the profits made by the company. The bonus amounts are subject to change every year based on the company’s valuation.
Loan Facility - In case of urgent liquidity needs policyholders of LIC Jeevan Labh can avail of the policy’s loan facility. The maximum amount of loan that one can avail of is subject to the surrender value acquired by the policy.
Paid-up value is the sum assured that one receives on paying two full years' premium and then discontinuing subsequent premium payments. When a policy acquires a paid-up value, the sum assured at policy inception decreases, therefore only the paid-up value is payable by the insurer as a death claim. Even if the amount is lower than the original sum assured, the policyholders still receive an amount equivalent to the acquired paid-up value.
The settlement option for maturity benefit can be availed under paid-up policies.
Simple reversionary bonuses remain attached to the reduced paid-up sum assured.
Loan facilities are also applicable under a paid-up policy. However, it is 80% of the acquired surrender value.
The death benefit can also be availed as installments under policies that have acquired a paid-up value.
There are certain terms and conditions that you should be mindful of to successfully claim benefits under the LIC Jeevan Labh paid-up policy. These are:
Premiums for two full years have to be duly paid.
The sum assured on death reduces to an amount equal to the death paid-up sum assured.
Under a paid-up policy, LIC Jeevan Labh does not participate in future profits made by the company.
Riders do not acquire paid-up value.
LIC Jeevan Labh policy subsists as a paid-up policy until the end of the policy term if two years' premium have been duly paid and subsequent payments are discontinued by the life assured.
The death paid-up sum assured is equal to the sum assured on death multiplied by the ratio of the duration for which premiums have been paid to the original period for which premiums were payable.
Let's assume a sample profile of a person who has assured a sum of Rs.10 Lakhs on death for a policy term of 21 years. Therefore, the corresponding premium paying term is 15 years. We will now calculate the 'death paid-up sum assured based on the calculation discussed above across different policy years.
|Duration of Premium Payment||Premium Paying Term (PPT)||Ratio||Original Sum Assured on Death (Rs.)||Death Paid-Up Sum Assured (Rs.)|
The last column represents the benefit payable by the insurer on the death of the life assured on the policy acquiring a paid-up value.
The paid-up option proves to be an extremely useful feature when one finds that their life cover is not up to their requirements. Therefore, if you find yourself in the same situation you should continue your premium payments for at least two years to acquire a paid-up value. This ensures that you do not lose out on the entire sum assured.
*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