LIC New Endowment Plan
The LIC New Endowment Plan is a non-linked life insurance plan with guaranteed returns and bonuses. The duration of this policy is 12 to 35 Years. Anyone between the ages of 8 and 55 can buy the policy. And the maximum age of maturity in this plan is 75 year or before.
It is a regular premium payment plan. The Life Insured will receive the Sum Assured + the vested Simple Reversionary Bonus +Final Addition Bonus on survival until the end of the Policy Tenure. On completion of the policy term, the Insured receives the Maturity Benefit under New Endowment Plan 814.
An Overview and Key Features: LIC’s New Endowment Plan
- You get guaranteed Returns and bonuses in this plan.
- On maturity or earlier death, the Nominee receives a simple reversionary bonus.
- There is an option for a Large Sum Assured Rebate.
- Insured can opt for the Accidental Death and Disability Benefit Rider.
- The “LIC New Endowment Plan (814)” was issued by LIC with slight improvements to the old 14 table in compliance with new IRDA guidelines.
- In LIC New Endowment Plan (814) Service tax of 3.09 per cent will be applied.
- The LIC New Endowment Plan is a combination plan that incorporates Endowment and Term insurance.
- Suppose individual life to the end of the policy’s duration. In that case, he or she will be eligible for Maturity Benefits, which include SUM ASSURED BONUS + FAB(Final Additional Bonuses), among other things.
- If he dies during the policy’s term, the Death Benefit will be paid to the Nominee, i.e. the Sum ASSURED+BONUS earned up to that point.
- The New LIC Endowment Plan (814) offers a high bonus and a high level of liquidity and savings.
Conditions of eligibility and other limitations in the LIC New Endowment Plan
|Sum Assured (in Rs.)||1,00,000, in multiples of 5,000||No Limit|
|Policy Term (in years)||12||35|
|Premium Payment Term (in years)||Equal to Policy Term|
|Entry Age of Life Insured (in years)||8||55|
|Age at Maturity(in years)||–||75|
|Payment modes||Yearly, Half Yearly, Quarterly or Monthly|
Maturity Calculator for LIC’s Latest Endowment
You will use this to measure the Maturity Value of the LIC New Endowment and prepare accordingly. Returns from the LIC New Endowment Scheme are entirely tax-free.
Rebates under the new LIC Plan 814
The Sum Assured selected by the Policyholder determines the discounts offered by the LIC New Endowment Policy. Below is a table with detailed rebate details.
Yearly – 2 percent table premium
Half-yearly – 1 percent table premium
Sum Assured Rebate
|Rs.1,00,000 to Rs. 1,95,000||NIL|
|P.P Term/ P.Term||21|
- The following riders are available: Yes, indeed.
- Policy Revival: From the date of the First Unpaid Premium, You can revive this policy within three years of the first unpaid premium.
- Suicide Clause: If the insured commits suicide by the end of the 12-month term, he will receive an 80 per cent refund of the premium he paid.
- Proposal Forms: This strategy would make use of Proposal Form No. 300 or 340.
- Service Tax: In line with the LIC’s New Endowment Policy, There is a service tax of 3.09 per cent.
- Cooling-off Period: If a policyholder is dissatisfied with the policy’s “Terms and Conditions,” he or she has 15 days from the date of receipt to return the policy.
|Half Yearly Premium||11550||811||11897|
|Rs.2,00,000 to Rs.4,95,000||2.00 % Basic Sum Assured|
|Rs.5,00,000 and above||3.00% Basic Sum Assured|
Benefits of LIC’s New Endowment Scheme
- Death Benefit:
The death benefit is described as the amount of “Sum Assured on Death” and vested Simple Reversionary Bonuses and Final Additional Bonus If all due premiums have been paid by the insured. The death benefit must be at least 105 per cent of all premiums charged at the time of death.
The service fee, additional insurance, and any rider premiums are not included in the premiums.
- Risk Coverage: before the end of the Policy’s duration
- Date of Commencement of Risk: Risk commencement for children under eight begins either two years after the policy is purchased or when the child hits eight, whichever comes first.
- Locking Period: Three years.
- Loan Facility: Available.
- Income Tax Reduction: Premiums charged are deductible under Section 80C, and Maturity returns are deductible under Section 10(10D), for more specifics on the Insurance Policy Tax.
- Housing Loan Surety: House Loan Surety is available via the LIC New Endowment Plan.
- Back-dating interest: The insurance plans can be traced back to the same financial year.
Assignments/Nominations: This plan provides for assignments and nominations
- Maturity Benefit
On survival to the end of the policy period, the Basic Sum Assured and any vested simple reversionary benefits and Final Additional Incentive will be paid in a lump sum if all due premiums have been paid.
Participation in Profits: If the Policy is in full effect, it will be entitled to share in the Corporation’s income and will be eligible for an Easy Reversionary bonus based on the Corporation’s experience.
Final (Additional) Bonus can be declared in the year that the Policy results either by death or maturity if the Policy has been in force for at least a year.
What happens if?
You stop paying the premium – The agreement lapses and all benefits end if the premiums not paid during the Grace Period. If at least three years of premiums have been charged, the policy earns a Paid-up Value for a Reduced Sum Assured, but it remains available for future regular additions.
Reduced Sum Assured = Basic Sum Assured *(Number of Premiums Paid / Total Number of Premiums Payable)
The policy can be revived after two years from the date of the first unpaid premium.
You want to surrender the policy –Only after the policy has accrued Cash Value and premiums have been charged for at least three years will it be surrendered. This percentage will be determined by the policy term and year in which the policy is surrendered, as seen in the table.
You want a loan against your policy – If the policy has a surrender value and the terms and conditions are met, a loan may be obtained under the policy.