Insurance Plans 3689 views February 27, 2020

LIC Jeevan Labh

LIC Jeevan Labh is a non-linked, endowment plan for individuals looking for a limited premium paying term. This plan offers the policyholder with the dual benefits of protection and savings.

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As the name suggests, it provides financial support to the nominee in case of the unfortunate demise of the policyholder any time before maturity. Under this plan, the surviving policyholder is entitled to receive a lump sum amount at the time of maturity. LIC Jeevan Labh also provides other liquidity benefits to the policyholder.

Features of LIC Jeevan Labh

The features of LIC Jeevan Labh are as follows.

  1. Under this plan, the premium can be paid annually, bi-annually, quarterly or monthly (through ECS only) or through salary saving scheme mode.
  2. Grace period: The plan allows a 30 day grace period for payment of annually, bi-annually, or quarterly premiums and a 15 day grace period for payment of monthly premiums.
  3. The policyholder is required to pay his/her premiums along with the statutory taxes imposed on the policy by the Government of India.
    Free-look period: If the policyholder is not satisfied with the policy, he/she may return the policy within 15 days.
  4. Surrender value: The policy-holder can surrender his/her policy if he/she has paid three full years of premium. The guaranteed surrender value shall be a percentage of the total premiums paid and varies according to the policy term and policy years. The maximum rate is 80% for the policy term of 25 years.
  5. Exclusion: LIC Jeevan Labh shall be considered void under conditions of a suicide.

If the policyholder commits suicide at any time within 12 months from the date of the start of risk or revival, the corporation is liable to pay only 80% of the total premiums paid provided the policy is in full force.

Benefits of LIC Jeevan Labh

LIC Jeevan Labh provides individuals with the dual benefit of protection and savings. The key benefits of LIC Jeevan Labh are as follows

1. Maturity benefit

On survival of the policyholder at the end of the policy term, he/she is paid the basic sum assured+ simple reversionary bonus+ final additional bonus in a lump sum. This is only possible if all the premiums for the policy are paid.

2. Death benefit

In case of the unfortunate demise of the policyholder during the policy term, his/her family receives a financial benefit in the form of the sum assured on death plus vested simple reversionary bonuses plus final additional bonus, if any, provided all the premiums for the policy are paid.

The sum assured on death is higher of A or B

  1. 10 times of annualized premium
  2. 105% of all the premiums paid as on date of death

3. Rider benefit

LIC Jeevan Labh provides the policyholder with additional options that he/she can avail.

They are as follows

  1. New Term Assurance Rider
  2. Accidental Death and Disability Benefit Rider.

4. Revival benefit

In case the premium on the plan is not paid by the policyholder within the grace period of 15/30 days, the insurance policy will lapse. The lapsed policy can be revived by paying the outstanding amount of the premium together with interest at a rate fixed by the corporation within a period of two years from the date of the first unpaid premium.

5. Loan against policy

The policyholder is eligible for a loan against the policy provided he/she has paid timely premiums for three years.

6. Tax Benefits

The policyholder is eligible to enjoy tax benefits as per the Income Tax Act, 1961.

Eligibility conditions of LIC Jeevan Labh

The eligibility conditions of LIC Jeevan Labh are as follows

  1. Entry age: The minimum age at entry is 8 years (completed) and the maximum age is 59 years for the policy term of 16 years, 54 years for the policy term of 21 years and 50 years for the policy term of 25 years.
  2. Basic sum assured: The basic sum assured is in the multiples of Rs 10,000. The minimum basic sum assured is Rs 2,00,000.
  3. Policy term and premium paying term: The premium paying term is 10 years for the policy term of 16 years, 15 years for the policy term of 21 years and 16 years for the policy term of 25 years.
  4. Maturity age: The maximum age at maturity is 75 years.

Conclusion

LIC Jeevan Labh provides the policyholder with multiple benefits. It is a dual policy-insurance plus savings and gives the individual flexibility with riders and financial security under unforeseen circumstances.

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