LIC CDA Endowment Vesting At 18 Plan

The main features of the LIC CDA Endowment Plan No. 50 are as follows:

1. If the child who is insured or the person paying the premiums for the child dies, premiums need not be paid.
2. If the period from the commencement of the policy to the time the child becomes policy owner is 10 years or more, medical tests are not required.

Benefits of LIC CDA Endowment Vesting At 18

There are many benefits of buying an LIC CDA Endowment Vesting At 18 plan for your child. Let's take a look at them:

1. Maturity Benefit: The Sum Assured and the bonuses declared up to the maturity of the policy, will be paid in a lump sum to the policyholder or the nominee.
2. Supplementary Benefits: If you pay additional premium, you can add optional benefits to your basic plan, which will provide the child with extra security.
3. Guaranteed Surrender Value: You can surrender your policy before maturity, if the policy is 3 years or older. Though you will not get the complete maturity benefits, you will get a Guaranteed Surrender Value (GSV). If the policy is surrendered before the deferred date, this is equal to 90% of all the premiums paid towards the policy, except the premiums paid for the first year. If the policy is surrendered after the deferred date, there are two scenarios:
   1. If the deferment period is less than 10 years, you will receive 90% of the premiums paid before the deferment date excluding during the first year, in addition to 30% of the premiums paid after the deferred date.
   2. If the deferment period is 10 years or more, you will receive 90% of the cash option in addition to 30% of the premiums paid after the deferred date.
4. Special Surrender Value: Special Surrender Value (SSV) is equal to or more than the Guaranteed Surrender Value. The corporation may decide to pay you SSV depending on the economic conditions and the corporation's profits.
5. Death Benefit: You receive the sum assured and all the collective bonuses in a lump sum if the insured child dies after the deferment period. If the child dies before the deferment period, you get a refund of all premiums paid until the time of death.
6. Tax Benefit: Premiums paid towards a life insurance policy is exempt from tax under Section 80C of the Income Tax Act, while the amount received on maturity is exempt under Section 10D.

How It Works

The deferred endowment plan for children comprises two stages: The deferment period and the insurance period. The deferment period covers the time from when the policy begins to the time when the child turns 18. The period from the time the child becomes the owner of the policy - at age 18 - to the maturity date of the policy is stage two.

The risk of this policy begins when the child turns 18 and from then on his life is also insured. The deferred date under Plan No. 50 is the policy anniversary date that comes on or after the child's 18th birthday.

Riders

The Accident Benefit Rider and Premium Waiver Benefit Rider are available on the CDA Endowment Vesting at 18 policy. Accidental death, total and permanent disability are covered under the Accident Benefit Rider. The beneficiary gets an additional amount in case of such life-altering accidents. Under the Premium Waiver Benefit Rider, the benefits of the scheme are protected even if you do not pay premiums for the policy under certain emergency situations, such as complete disability, death and loss of income. To avail either of these riders, you have to add an additional amount to the premium paid.

GST of 18% is applicable on life insurance effective from the 1st of July, 2017