On March 1, 2012, Life Insurance Corporation - the big insurance company of India has launched a new insurance plan called LIC 'Jeevan Vriddhi' plan. It is a single-premium non-linked and close ended insurance plan. It bids a life cover of 5 times the amount of premium paid by the policy holder and guaranteed returns after maturity. A possible loyalty bonus is also guaranteed by the company.
The main features of the LIC Jeevan Vriddhi plan are as follows:
Death Benefit
The policy is a perfect amalgamation of insurance and returns as on death of the insured during the policy term, the nominee will get 5 times the premium paid.
Maturity Benefit
The policy holder will get guaranteed maturity sum assured with loyalty addition (if any) at the end of the policy tenure. The Sum Assured will depend on the age at which the insured enters the plan and the single premium excluding any type of extra premium.
Loyalty Benefit
Depending upon experience of the Corporation, the policy would be eligible for a Loyalty Addition on date of maturity on such terms and at such rate as declared by the Corporation.
Loan Benefit
Loan facility will be also available under this scheme. The policy holder can take a loan against the policy, provided the policy has completed at least one year.
Surrender Value
After the policy has run for at least 1 year, it can be surrendered for cash. The smallest Guaranteed Surrender Value permissible is equal to 90 percent of the Single premium paid exclusive of the extra premium, if any. However, the Corporation can pay Special Surrender value as applicable on the surrender date provided the same is more than the Guaranteed Surrender Value. The Special Surrender Value would be the value of the Guaranteed Maturity Sum Assured as on the surrender date.
Tax Benefit
On maturity of the policy, the amount of sum assured that will be received by the policy holder will not be taxable.
Service Tax
Service tax, if any, shall be payable according to the Service Tax laws and the service tax rate as applicable from time to time. The amount of service tax as per the prevailing rates shall be payable by the insured on the premium.
The minimum age to enter the policy is 8 years and the maximum age is 50 years. The policy term is 10 years and it requires just a single premium to be paid. The minimum amount that you can pay as a premium is Rs 30,000. The maximum amount of premium has no limit. Similarly the minimum amount of sum assured that the insured will get is Rs 150,000 whereas there is no limit of the maximum sum assured. This LIC scheme is available for a limited period only (up to a maximum of 120 days from the day of launch i.e. March 01, 2012).
In case a person is not satisfied with the Terms and Conditions of the policy, he/she may return the policy within a time limit of 15 days from the receipt date of the policy, to the Corporation affirming the reason of objection. On receipt of the returned policy, the Corporation shall cancel it and return the amount of the single premium deposited, after deducting the risk premium and expenses incurred on stamp duty and medical examination.
The policy shall be void if the policy holder commits suicide within 1 year from the date of commencement of policy and the Corporation will not entertain any type of claim under this policy apart from the extent of a maximum of the 90 percent of the premium paid exclusive of any extra premium paid OR 3rd party bonafide beneficial interest obtained in the policy for valuable consideration (but restricted to applicable death benefit) of which written notice has been given to the branch of the corporation where the policy is currently being serviced at least one month before death.
The LIC Jeevan Vriddhi may be looked as an ideal plan for people of all age groups. It may be helpful for parents who want to save money for higher education of their children or for financing other needs of the children who have grown up or even the youngsters who want to save money for following their passion after some years of hard work and gaining some experience.
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