Accidents and unforeseen events serve as reminders of life’s fragility, emphasizing the need for comprehensive life insurance coverage. Life insurance is a crucial instrument in ensuring the safety and security of an individual’s family. It serves as a protective shield, providing financial support to the insured’s dependents. Without life insurance, the untimely demise of an individual could leave their loved ones grappling with significant liabilities, including rent, loans, EMIs, and childcare expenses.
For individuals with dependents such as family or business, a life insurance policy offers invaluable financial security. In the event of your demise, your beneficiaries are assured a lump-sum payment, guaranteed to be paid in full as long as all premiums are up to date and there are no outstanding loans. This protection serves as a reliable and essential resource, providing support to your loved ones precisely when they need it.
With LIC’s Jeevan Lakshay and HDFC Life Sanchay Plus gaining traction on the market, choosing the right one is a challenge. If you want to choose one, you may need to understand each plan along with their maturity benefit illustration in detail.
Differences Between LIC’s Jeevan Lakshay Vs HDFC Life Sanchay Plus
Let’s take a look at the differences between LIC’s Jeevan Lakshay and HDFC Life Sanchay Plus.
| Parameters | LIC’s Jeevan Lakshay | HDFC Life Sanchay Plus | |||
| Guaranteed Income | Guaranteed Maturity | Life Long Income | Long Term Income | ||
| Minimum Age at Entry | 18 years (last birthday) | 30 days | 30 days | 50Years | 3Years |
| Maximum Age at Entry | 50 years (nearer birthday) | 65 Years | 60 Years | 65 Years | 60 Years |
| Maximum Maturity Age | 65 years (nearer birthday) | 85 Years | 80 Years | 85 Years | 75 Years |
| Riders | LIC’s Accidental Death and Disability Benefit Rider LIC’s Accident Benefit Rider LIC’s New Term Assurance Rider LIC’s New Critical Illness Benefit Rider | HDFC Life Income Benefit on Accidental Disability Rider (101B013V03) HDFC Life Critical Illness Plus Rider (101B014V02) | |||
| Policy Term | 13 to 25 years | 5 To 20 Years | |||
| Loan Benefit | As long as the policy’s minimum of two complete years’ premiums has been paid, a loan may be obtained. The maximum loan amount expressed as a proportion of the surrender value is under: • For in-force policies – 90% • For paid-up policies – 80% | Once your policy has acquired the surrender value, you may avail of a policy loan of up to 80% of the surrender value of your policy. | |||
| Maturity & Death Benefit | Yes | Yes | |||
| Lifelong Income Option | Not Available | Guaranteed income till age 99 years | |||
| Premium Payment | Single Pay, Annual, Half-Yearly, Quarterly, Monthly | Yearly, Half-Yearly, Quarterly, Monthly | |||
| Tax Benefit | Not Available | Depending on the applicable tax legislation, you can be qualified for tax benefits. | |||
Understanding LIC’s Jeevan Lakshay
LIC’s Jeevan Lakshay is a life assurance plan that combines protection and savings. It is a non-linked, participating, and individual plan designed to provide an Annual Income benefit in the event of the policyholder’s unfortunate death before maturity. This benefit aims to meet the family’s needs, especially for the benefit of children. Additionally, the plan ensures a lump sum amount at the time of maturity, regardless of the policyholder’s survival. To address liquidity needs, Jeevan Lakshay by LIC offers a convenient loan facility.
Unique Features of LIC’s Jeevan Lakshay
Here is the list of the key features and benefits of Jeevan Lakshay by LIC.
Death Benefit:
In the unfortunate event of Life Assured’s demise before the specified Date of Maturity, provided the policy is active with up-to-date premium payments, the Death Benefit will be applicable. The Death Benefit comprises the “Sum Assured on Death,” incorporating vested Simple Reversionary Bonuses and any Final Additional Bonus. The “Sum Assured on Death” is the total of
- The vested Simple Reversionary Bonuses and Final Additional Bonus, if applicable, included in the Death Benefit, will be disbursed on the maturity due date.
- The Death Benefit, as specified earlier, will not be lower than 105% of the total premiums paid as of the date of death. Premiums mentioned above do not include taxes, additional premiums, and rider premiums, if any.
Maturity Benefit:
If all the premiums have been duly paid, and the policyholder survives until the completion of the policy term, the Maturity Benefit will include the Sum Assured on Maturity, along with the vested Simple Reversionary Benefits and any Final Additional Bonus. The Sum Assured on Maturity is equivalent to the Basic Sum Assured.
Participation in Profits:
Being a participating plan, LIC’s Jeevan Lakshya Plan is eligible to receive bonuses declared by LIC, enhancing the overall benefits. In the unfortunate event of the policyholder’s demise, the plan continues to participate in profits until the maturity date, with the full entitlement of the fixed Final Additional Bonus and Simple Reversionary Bonus, if any, being payable on the maturity due date.
Grace Period:
A grace period of 30 days is provided for premium payments. If the policyholder fails to make payments within this grace period, the policy will automatically lapse. Nevertheless, there is an option to revive the policy within two years from the date of the first unpaid premium.
Free Look Period:
The policyholder has the option to cancel the policy within 15 days from the date of receipt if they are dissatisfied with the policy conditions, provided that no claims have been registered with LIC during this period.
Surrender Benefit:
The policy can be surrendered at any time provided at least two full years’ premiums have been paid. On surrender of the policy, the Company shall pay the Surrender Value equal to higher of Guaranteed Surrender Value or Special Surrender Value.
Next, what is HDFC Life Sanchay Plus?
HDFC Life Sanchay Plus is designed to provide financial security through careful planning for significant life stages like marriage, parenthood, and retirement. As a non-participating, non-linked, savings insurance plan, it not only aids in achieving financial security but also provides protection for your family in the face of life’s unexpected events, ensuring their well-being even in your absence. Policyholders contribute regular premiums, receive a life insurance benefit, and have the chance to accumulate savings throughout the policy’s duration.
What Distinguishing Features Does HDFC Life Sanchay Plus Offer?
Listed below are the features and benefits of HDFC Life Sanchay Plus.
Life Long Income:
The major feature and benefit of this plan is that it offers lifelong income until the age of 99 and refunds the entire premium paid at the conclusion of the payout period, provided all premiums are paid during the policy term.
Long-Term Income:
With HDFC Life Sanchay Plus, you will likely receive a fixed-term guaranteed income for 25 or 30 years and refund the total premiums paid upon the clearance of all due premiums during the policy term.
Guaranteed Income:
This plan will provide guaranteed income for a fixed term of 10 or 12 years upon clearing all due premiums during the policy term.
Income Benefit on Accidental Disability Rider:
In the event of Accidental Total Permanent Disability, a benefit equivalent to 1% of the Rider Sum Assured will be provided each month for the subsequent 10 years.
Critical Illness Plus Rider:
If the applicants are diagnosed with any of the 19 Critical Illnesses and survive for 30 days following the diagnosis, a lump sum equal to the Rider Sum Assured will be provided.
Policy Loan:
After the payment of a minimum of 2 years’ premium, the plan attains a guaranteed surrender value, allowing policyholders to avail of a loan of up to 80%.
Alteration Options:
HDFC Life Sanchay Plus provides flexibility by allowing policyholders to change both premium payment frequency and income payout frequency.
Maturity Benefit Calculation of LIC’s Jeevan Lakshay & HDFC Life Sanchay Plus
LIC’s Jeevan Lakshay:
Let’s take the example of Mr. Yadav working as a service engineer at Cognizant. At the age of 30, the life assured opts for LIC’s Jeevan Lakshay with a policy term of 25 years and a premium payment term of 22 years. Choosing the yearly premium payment mode, they secure a basic sum assured of Rs. 1,00,000. The premium, excluding taxes, is set at Rs. 4,366. This plan ensures coverage for the next 25 years, providing financial protection and peace of mind for the policyholder and their beneficiaries.
| End of the Year | Total Premium Paid till the end of the year (Rs.) | Sum Assured on Maturity (in Rs) | Total Maturity Benefit inclusive of Final Additional Bonus, if any (in Rs.) |
| 25 | 96,052 | 1,00,000 | 1,90,000 |
HDFC Life Sanchay Plus:
Consider a healthy male, named Mr. Yadav aged 30 who opts for the HDFC Life Sanchay Plus plan, paying Rs. 1 lakh plus taxes annually throughout the premium paying term. Assuming he survives the policy term, he stands to benefit significantly from the chosen plan. This illustration demonstrates the financial security and returns that can be achieved through responsible financial planning and investment in the right plan.
Sum Assured | Death Benefit at Inception | Policy Term (years) | Premium Paying Term (years) | Maturity Benefit (INR) |
| Rs. 1,000,000 | Rs. 1,250,000 | 20 | 10 | Rs. 23,84,240 paid as a lump sum at Maturity |
What to Consider: LIC’s Jeevan Lakshay or HDFC Life Sanchay Plus?
Choosing between LIC’s Jeevan Lakshay and HDFC Life Sanchay Plus involves considering various factors such as your financial goals, risk tolerance, and preferences. LIC’s Jeevan Lakshay is a limited premium paying, non-linked, participating endowment assurance plan that provides both protection and savings. On the other hand, HDFC Life Sanchay Plus is a non-linked, non-participating life insurance savings plan offering guaranteed returns with multiple options.
Key considerations include the specific features, benefits, and terms of each plan, such as the policy term, premium payment term, maturity benefits, death benefits, and any additional riders or options available. Additionally, compare the financial strength and reputation of LIC and HDFC Life as insurance providers. If you want an insurance plan backed by the Government that gives you a sense of security, then LIC’s Jeevan Lakshay is an ideal choice. On the other hand, if you want better customer support and a myriad of benefits, then HDFC Life Sanchay Plus may help you out!
