LIC New Children Money Back Plan

LIC’s New Children’s Money Back Plan is a non-linked, participating, individual, life assurance money back plan that helps meet educational, marriage and other needs of children. Also, the policy provides life cover to the insured, so the child won’t face financial trouble in case of an unfortunate event. So parents, if your child is aged between 0 to 12 years, and you are looking for a life cum investment plan, purchase LIC’s New Children’s Money Back Plan. Even grandparents wanting to secure the future of their grandchildren can have this plan. Key features of this LIC Plan are shown below –

1. Death Benefit
2. Survival Benefit
3. Maturity Benefit
4. Participation in Profits

Know more about the features and benefits of LIC’s New Children’s Money Back Plan below.

LIC’s New Children’s Money Back Plan Death Payout

In case of an unfortunate event of the death of the life assured (children) during the policy term, provided the policy is in force, the nominee/beneficiary will receive a death benefit.

Death Before the Date of Commencement of Risk

An amount equal to the total amount of paid premiums excluding taxes, extra premium and rider premium, if any, shall be payable to the nominee/beneficiary.

Death After the Date of Commencement of Risk

Sum Assured on Death along with vested simple reversionary bonuses and final additional bonus, if any, shall be payable to the nominee/beneficiary. Here, the Sum Assured on Death is higher of –

1. Basic Sum Assured
2. 7X the annualized premium

LIC’s New Children’s Money Back Plan Survival Benefit

If the life assured survives on each of the policy anniversaries coinciding with or immediately after attaining the ages of 18, 20 and 22 years, the insurance company will pay 20% of the Basic Sum Assured on each occasion, provided the policy is in force.

LIC’s New Children’s Money Back Plan Maturity Benefit

If the life assured survives till the maturity date of this LIC plan, he/she will receive the sum assured on maturity along with vested simple reversionary bonuses and final additional bonus, if any. Here, the sum assured on maturity is equal to 40% of the basic sum assured.

LIC’s New Children’s Money Back Plan Participation in Profits

This LIC plan shall participate in profits, and this makes the life assured entitled to receive simple reversionary bonuses as declared by the insurance company. A final additional bonus may also be declared by the insurance company if this LIC policy results in a death or maturity claim.

Note – Final Additional Bonus shall not be payable under paid-up policies. The actual allocation of profits to policyholders out of surplus emerging from the actuarial investigation shall be approved by the Central Government as per the provisions under LIC Act, 1956.

Eligibility and Other Conditions of LIC’s New Children’s Money Back Plan

If you want to purchase LIC’s New Children’s Money Back Plan for your children, your child should meet the below-mentioned age criteria –

1. Minimum Entry Age of Children – 0 years (as on the date of last birthday)
2. Maximum Entry Age of Children – 12 years (as on the date of last birthday)
3. Minimum/Maximum Maturity Age – 25 years (as on the date of last birthday)

This LIC Plan policy term and premium paying term is calculated as follows –

[25 years – Life Assured Entry Age]

In case the entry age is < 8 years, the risk under this plan will commence either –

1. One day before the completion of 2 years from the date of commencement of the policy
2. One day before the policy anniversary coinciding with immediately following the completion of 8 years of age

whichever is earlier.

Note – If the entry age is 8 years or more, the risk will commence immediately from the date of issuance of the policy.

Date of Vesting Under the LIC’s New Children’s Money Back Plan 

The LIC’s New Children’s Money Back Plan shall automatically vest on the policy anniversary coinciding with or immediately when the life assured turns 18 years old.

Opt LIC’s Premium Waiver Benefit Rider for Add-on Cover

This rider can be opted under this policy any time coinciding with the policy anniversary but within the premium paying term, provided the outstanding premium paying term of LIC’s New Children’s Money Back Plan and the rider are for a minimum of 5 years. This rider waives the premium payment in respect of base policy if the proposer dies. Under this rider, the premium amount shall not exceed 30% of premiums under the base plan.

Note – LIC’s Premium Waiver Benefit Rider is allowed under this LIC plan if the life assured is minor at the time of opting for this rider. If the proposer’s age is more than 70 years, the rider shall not be allowed.

Option to Receive Death & Maturity Benefit in Installments

LIC allows you to receive maturity or death benefit payout in installments over – 5, 10 or 15 years, as chosen by you. This option can be exercised by the policyholder while the life assured is minor or by the life assured when he/she turns 18 years or above. The installments shall be paid in advance in yearly, half-yearly, quarterly or monthly intervals, as opted by your or the life assured. The minimum installment amount for different modes of payments is as follows –

1. Monthly – INR 5,000
2. Quarterly – INR 15,000
3. Half-Yearly – INR 25,000
4. Yearly – INR 50,000

If the Net Claim Amount is less than the minimum installment amount, the claim proceeds shall be paid in lump sum only. The interest rates on these installments are fixed by LIC and may change from time to time.

Important Notes

1. The death claim amount shall be paid to the nominee as per the option exercised by the Policyholder/Life Assured and no alteration shall be allowed from the nominee’s end.
2. The policyholder/life Assured can exercise the settlement option for maturity benefit at least 3 months before the due date of maturity claim. The first payment will be made on the date of maturity and thereafter, every month or three months or six months or annually, as chosen by the policyholder/life assured.

Free Look Period

If you’re not satisfied with the terms and conditions of LIC’s new children’s money back plan, don’t worry. Because the policy can be returned to the insurance company within 15 days from the date of its receipt. On such cancellation, the insurance company will return the amount of paid premium after deducting the proportionate risk premium (for base plan and rider, if opted), expenses incurred on medical examination and stamp duty charges.

Suicide Clause

If the life assured commits suicide within 12 months from the date of commencement of risk, the insurance company won’t provide the above-mentioned benefits to the nominee except for 80% of the total premiums paid. However, if the life assured commits suicide within 12 months from the date of revival, an amount higher of –

1. 80% of the total paid premiums
2. Surrender value

will be payable to the nominee/beneficiary.

This clause shall not be applicable:

1. If the life assured age is less than 8 years at policy inception or revival
2. If the policy lapses and converts into paid-up, nothing shall be payable to the nominee

Note: Premiums related to suicide clause payout shall not include any taxes, extra premium and rider premium, if any.