LIC Jeevan Labh
LIC Jeevan Labh (Plan No. 936, UIN No. 512N304V02) is a standard, non-linked, with-profit insurance and investment plan. This policy not only gives financial assistance to the insured’s family in the event of an emergency, but it also covers the family’s future financial needs even if the insured individual is not present. It’s a limited premium payment plan, which means you don’t have to pay premiums for the entire policy period.
Furthermore, the LIC Jeevan Labh Plan provides death and maturity benefits, as well as a profit participation bonus. This plan has been ranked as one of LIC’s best-selling endowment plans. Through its loan facility, this plan also addresses liquidity requirements. The plan provides a host of benefits to the policyholder. Let’s know about LIC Jeevan Labh policy in detail!
Key Highlights Of The Plan
|Type||Limited Premium Endowment Plan|
|Premium Payment Term||10, 15, & 16 Years|
Features Of The LIC Jeevan Labh Policy
Some of the key features of LIC Jeevan Labh policy are as follows:
- Tax Benefits: As per the relevant sections of Income Tax Act 1864, tax benefits are available under the LIC Jeevan Labh policy. Under Section 80C of the Income Tax Act, 1961, the premiums paid for LIC’s Jeevan Labh policy are tax-free. Furthermore, under Section 10(10D) of the Income Tax Act of 1961, the maturity amount is tax-free. The amount of tax paid will not be taken into account when calculating the plan’s benefits.
- Loan Facility: After paying two years of premiums, you can get a loan on this coverage. At periodic intervals, the interest rate to be charged for the policy loan and as applicable for the whole term of the loan will be set.
- Free Look-Up Period: If the policyholder is dissatisfied with the plan, he has 15 days from the date of issuance to terminate it. The premium paid, less any applicable expenses would be reimbursed upon cancellation.
- Grace Period: You have a grace period of 30 days from the premium due date if you pay your premiums annually, half-yearly, or quarterly. The grace period is 15 days if you pay your premiums on a monthly basis.
- Payment Of Premium: During the premium-paying duration of the policy, premiums might be paid on a yearly, half-yearly, quarterly, or monthly basis.
- Surrender Value: If two full years’ premiums have been paid, the policy can be surrendered at any time. The corporation must pay the surrender value equivalent to the higher of “Guaranteed Surrender Value” or “Special Surrender Value” when the policy is surrendered.
LIC Jeevan Labh Policy Eligibility Criteria
|Policy Term||16, 21, & 25 Years|
|Minimum Entry Age||8 Years (Completed)|
|Maximum Entry Age|
|Minimum Basic Sum Assured||Rs. 2,00,000|
|Maximum Basic Sum Assured||No Limit|
|Maximum Maturity Age||75 Years|
What Benefits Are Available Under The LIC Jeevan Labh Policy?
The following are the three major benefits provided by the LIC Jeevan Labh policy:
- Death Benefit: The total of the ‘Sum Assured on Death’, ‘Simple Reversionary Bonuses’, and the ‘Final Additional Bonus’ is handed out as death benefits (if any) to the policyholder. The higher of the 10 times annual premium paid or the basic sum assured is the ‘Sum Assured on Death’. The death benefit will not be less than 105 % premiums paid as of the death date.
- Maturity Benefit: The policyholder will receive the amount assured on maturity as a lump sum at the policy’s maturity, which is equal to the ‘Basic Sum Assured’ plus any vested ‘Simple Reversionary Bonuses’ and ‘Final Additional Bonuses’.
- Profit Participation: If the insurance is in full force, policyholders are eligible for the company’s ‘Simple Reversionary Bonuses’. When a claim for maturity or death is lodged, a ‘Final Additional Bonus’ may also be awarded.
Functioning Of LIC Jeevan Labh Policy
Let’s understand with an example how the LIC Jeevan Labh policy works!
We have Mr. Akash, who is 35 years old and wishes to buy the LIC Jeevan Labh policy. He decided to buy the plan with a sum assured of Rs. 2,00,000, policy term of 25 years, and premium payment term of 16 years.
His annual premium is Rs. 9,290 + taxes = Rs. 9,708. We’ve used a 4.5 percent tax rate as a starting point.
If Mr. Akash dies within the policy period, let’s say after 2 policy years
If Mr. Akash dies after 2 policy years, the nominee will get Sum Assured + Simple Reversionary Bonus + Final Addition Bonus.
SUM ASSURED: Rs. 2,00,000
SIMPLE REVERSIONARY BONUS: We’ve assumed that a bonus of Rs. 40 per 1,000 Sum Assured is declared each year.
Therefore, Simple Reversionary Bonus will be 40 X 200 X 2, which is equal to Rs. 16,000.
FINAL ADDITION BONUS: The final additional bonus is usually announced after a considerably longer period of premium payment. So, here the value will be nil.
TOTAL VALUE: Therefore, the nominee will get Rs. 2,00,000 + Rs, 16,000, i.e., Rs. 2,16,000.
If Mr. Akash survives the policy term of 25 years
If Mr. Akash survives the policy term of 25 years, he will get Sum Assured + Simple Reversionary Bonus + Final Addition Bonus.
SUM ASSURED: Rs. 2,00,000
SIMPLE REVERSIONARY BONUS: We’ve assumed that a bonus of Rs. 40 per 1,000 Sum Assured is declared each year. Therefore, the value will be Rs. 40 per 1000 Sum Assured for 25 years, i.e., 40 X 200 X 25 = Rs. 2,00,000.
FINAL ADDITION BONUS: We’ve assumed a one-time Final Addition Bonus of Rs. 20 per 1,000 Sum Assured in this example. Therefore, the value will be Rs. 20 per 1000 Sum Assured, i.e., 20 X 200 = Rs. 4,000.
TOTAL VALUE: Mr. Akash will get Rs. 2,00,000 + Rs. 2,00,000 + Rs. 4,000 = Rs. 4,04,000.
Optional Benefits of LIC Jeevan Labh
The LIC Jeevan Labh policy also offers other options as discussed below:
Rider Benefits: By paying an additional charge, you can add the following riders to your plan:
- Accidental Death & Disability Benefit Rider
- Accident Benefit Rider
- New Term Assurance Rider
- New Critical Illness Benefit Rider
- Premium Waiver Benefit Rider
Settlement Option For Maturity Benefit: Under an in-force and paid-up policy, the settlement option allows you to receive your maturity benefit in installments over a predetermined period of 5, 10, or 15 years rather than a lump sum payment.
Option To Take Death Benefits In Instalment: Under an in-force and paid-up policy, this is an option to receive death benefits in installments over a 5-, 10-, or 15-year term instead of a lump sum payment.
How To Buy LIC Jeevan Labh Insurance?
To purchase the “LIC New Jeevan Labh” policy in person, go to your nearest LIC branch. Make sure you have all of the necessary paperwork so you may purchase the policy without delay. You may reach the company at +91-022 6827 6827 for more details.
If you continue to have issues, you can contact Probus Insurance for assistance.
Frequently Asked Questions
The maximum loan amount allowed under the policy, expressed as a percentage of the surrender value, is as follows:
- For In-Force Policies: Up To 90%
- For Paid-Up Policies: Up To 80%
In terms of premium frequency, 2% of Tabular Premium for yearly mode and 1% of Tabular Premium for half-yearly mode are offered as rebates. Sum assured of Rs. 5 lakhs to Rs. 9.9 lakhs receive a rebate of 1.25% of Basic Sum Assured, Rs. 10,00,000 to 14.9 lakhs receive 1.50%, and Rs. 15 lakhs and above receive 1.75%.
Yes. If less than two years’ premiums have been paid and any subsequent premium is not paid on time, all benefits under this insurance will terminate when the grace period expires from the date of the first unpaid premium, and no payment will be made. In this situation, the policy will not be null and void but will continue to function as a paid-up insurance until the conclusion of the policy term.
If the insured commits suicide within the first year of the policy period, the insurance company will not pay the nominee any of the sums assured. However, if the policyholder commits suicide after one year, the nominee is entitled to receive 80 percent of the premiums, interest-free.
Yes. The policyholder or life assured must exercise the option for payment of net claim amount in installments at least 3 months before the maturity due date to exercise the settlement option against maturity benefit.