LIC New Bima Jyoti (Plan 890)

LIC New Bima Jyoti - An Overview

The LIC New Bima Jyoti is a non-participating and non-linked individual savings plan that provides assured benefits and guaranteed additions. In case of death of the policyholder, their family gets the claim amount as death benefit to support them financially. In the case the policyholder survives the policy term, they get the claim amount as maturity benefit so they can live the rest of their lives comfortably. This protection plus savings combination is an attractive feature of the LIC New Bima Jyoti Plan 890.

Key Features of LIC New Bima Jyoti

• The plan provides both insurance protection and savings.

• The beneficiary receives guaranteed additions at the end of each year. They are calculated at 6% interest rate of the total annualized premiums in respect of premiums paid during the policy term.

• The flexibility to:

  • Choose the period for which the protection is needed. They can choose between 15 and 20 years.

  • Opt for getting the death and maturity benefits in the form of installments.

• There is an option to choose additional riders by paying additional premiums to avail rider benefits and enhance the overall coverage.

• There is a loan facility to take care of liquidity needs of the policyholders.

• The plan offers benefits in the form of attractive incentives for high sum assured policies.

Eligibility Criteria of LIC New Bima Jyoti

What are the Benefits of LIC New Bima Jyoti Plan 890?

Death Benefit

In case of the unfortunate demise of the life assured during the policy term, death benefit is paid to the nominee just like in term insurance.

• In case the policyholder dies before the coverage starts, they will get a refund of the premiums they paid (excluding taxes and additional fees)

• In case the policyholder dies after the coverage starts, the nominee will receive the death benefit amount equal to the “Sum Assured on Death” and Accrued Guaranteed Additions.

The Sum Assured on Death is either 125% of the Basic Sum Assured or 7 times of annualised premium. Whichever is higher of the two is the Sum Assured on Death.

Note - The Death Benefit can not be less than 105% of the total premiums paid until the date of death of the life assured (excluding any extra fees, rider premiums, and taxes).

Maturity Benefit

If the policyholder survives until the maturity date and the policy is active, they will receive the Sum Assured on Maturity plus the accrued Guaranteed Additions. The Sum Assured on Maturity is equal to the Basic Sum Assured.

Guaranteed Additions

Guaranteed Additions are added every year as long as the policy is active and all premiums due have been paid. The Guaranteed Addition for LIC New Bima Jyoti (Plan 890) is 6% of the total annualised premium paid.

If the policyholder dies during a policy year, the Guaranteed Addition for the entire year will still be added even if the death occurs before the end of that year. If the policy is fully paid-up (all premiums for the entire premium-paying term have already been paid) the Guaranteed Additions will continue to accrue every year at the same applicable rate.

Optional Riders

LIC New Bima Jyoti Plan offers five additional and optional riders. To avail these riders policyholders have to pay additional premium for each rider. The riders help enhance the overall coverage of the policy. However, some of these riders may be subject to eligibility and other terms and conditions.

Sample Premium Illustration

The table below provides sample illustrations of annual premiums for the Basic Sum Assured of ₹10 lacs for standard lives.

The above premiums are exclusive of all taxes

Additional Rider Benefits

There are a total of five optional riders with the LIC New Bima Jyoti Plan 890. Policyholders can avail them by paying additional premium.

LIC’s Accidental Death and Disability Benefit Rider

In case of accidental death, the Accident Benefit Sum Assured is paid as a lump sum along with the base plan's death benefit. In case of accidental disability, it is paid in monthly installments over 10 years, with eligible future premiums waived.

This rider can be opted for during the premium-paying term and subject to the specified age and minimum 5-year remaining term conditions.

LIC’s Accident Benefit Rider

In case of accidental death within 180 days of the accident, the Accident Benefit Sum Assured is paid as a lump sum along with the base plan's death benefit. For minors the rider can be opted for after they turn 18.

This rider can be added during the premium-paying term provided at least 5 years remain for both the base plan and rider and the Life Assured is below 65 years of age.

LIC’s New Term Assurance Rider

If the Life Assured dies during the policy term, the Term Rider Sum Assured on Death is paid to the nominee.

This rider can be added only when the policy is purchased and the cover continues throughout the policy term.

LIC’s Premium Waiver Benefit Rider

If the Proposer (usually parent) dies during the rider term, future premiums for the base policy are waived until the rider ends so the child's policy continues without those premium payments. If the base policy's premium-paying term continues beyond the rider term, the life assured (generally the child) must resume paying the remaining premiums after the rider ends. Otherwise, the policy may become paid-up.

This rider is available only when the life assured is a minor and can be added to the policy on a policy anniversary if at least 5 years remain in both the base plan and rider.

LIC’s Critical Illness Health Rider

This rider can be added only when the policy is purchased and offers two options. First is 15 major critical illnesses and second is 40 major critical illnesses with Assisted Living Benefit (ALB). If the Life Assured is diagnosed with a covered critical illness, the Critical Illness Sum Assured is paid. Under Option 2, if diagnosed with one of the specified 7 critical illnesses, an additional 1% of the Critical Illness Sum Assured is paid monthly for 36 months as ALB.

The premium for this rider cannot exceed 100% of the base plan's premium, while premiums for all other life insurance riders together cannot exceed 30% of the base plan's premium.

LIC New Bima Jyoti Policy Details

Premium Payment

LIC premium payment for the New Bima Jyoti plan can be paid yearly, half-yearly, quarterly, or monthly through e-NACH/NACH, or through Salary Savings Scheme (SSS) deductions.

Settlement Option

LIC New Bima Jyoti Plan 890 allows the policyholders to choose how they get their death or maturity benefit. They can choose to get the payout as a lump sum or as installments distributed over the years as prescribed by LIC for death and maturity benefit.

Grace Period

A 30-day grace period is available for yearly, half-yearly, and quarterly premiums, while 15 days is available for monthly premiums. During this period the policy remains active with full risk cover. However, if the premium is not paid within the grace period the policy lapses. The same grace period applies to rider premiums paid along with the base policy.

Revival

The policy lapses if the premiums are not paid within the grace period. However, a lapsed policy can be revived within 5 consecutive years from the date of the first unpaid premium, subject to the policy terms and before the maturity date.

Paid-Up Value

If less than one full year's premium has been paid and you stop paying further premiums, the policy will lapse after the grace period and no benefits will be payable.

If at least one full year's premium has been paid, the policy will continue as a paid-up policy until the end of the policy term, even if you stop paying future premiums.

Surrender Benefit

The policy can be surrendered after completing the first policy year if at least one full year's premium has been paid. On surrender, the policyholder will receive the higher of the Guaranteed Surrender Value (along with the surrender value of accrued Guaranteed Additions) or the Special Surrender Value, as applicable.

Policy Loan

A loan can be availed against the policy’s surrender value during the policy term. The policyholder can take a loan after completing the first policy year but only if they have paid at least one full year’s premium. The maximum amount of the loan can vary based on factors like if the policy is active or paid up and the time period for which the premium has been paid by the policyholder.

Tax Benefits

Applicable statutory taxes on insurance policies are charged as per the prevailing tax laws and rates by the Government of India and may change from time to time. Policyholders may also be eligible for tax benefits under Sections 80C and 10(10D) of the Income Tax Act subject to applicable conditions.

Free Look Period

If the policyholder is not satisfied with the policy’s features, benefits, or terms and conditions they can return the policy. However, they can do so only within 15 days of receiving the policy documents for offline purchases and within 30 days for policies purchased online.

Waiting Period

If the Life Assured dies within 90 days from the commencement of risk, the insurer will refund the total premiums paid. However, the policy must be active and the death should not be due to an accident.

Incentives

The policy offers incentive for higher Basic Sum Assured (BSA). It is offered in the form of an increase in the rate of Guaranteed Additions within the policy.

How to Buy LIC Plans from Policybazaar?

Step 1: To buy LIC New Bima Jyoti, visit LIC of India

Step 2: Fill in the form with your name and contact number

Step 3: Next, fill in your age and current city

Step 4: Once done, on the next page you can check the plans available and customize the amount and period for your investments

Step 5: Choose the plan, and pay your premiums online.

Note: Policybazaar also provides door-to-door advisors to resolve your queries.

Exclusion

If the Life Assured dies by suicide within 12 months of the policy’s commencement of risk or revival, the nominee will receive 80% of the total premiums paid or the applicable surrender value, whichever is higher, provided the policy is in force.

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