This is a non-linked participating saving cum protection life insurance policy. The premium payment mode is Single Premium only while the risk cover is for 10 times the Single Premium amount. The Sum Assured at Maturity can be chosen by the policyholder while premium amount is decided on the basis of age at entry and Maturity Sum Assured chosen. Sufficient liquidity is provided through loan availability. The policy can be purchased within 4 months (120 days) of date of launch.
Eligibility Criteria for LIC Jeevan Shikhar
|Minimum entry age||6 years|
|Maximum entry age||45 years (nearer birthday)|
|Minimum premium||As per age at entry and sum assured chosen|
|Age at maturity||Max 60 years|
Key Features of LIC Jeevan Shikhar
|Plan type||Non-linked participating saving cum protection scheme|
|Premium paying terms||Single Premium|
|Policy term||15 years fixed|
|Maturity benefits||Maturity Sum Assured plus any Loyalty Additions will be paid at maturity|
|Premium payment frequency||Single Premium|
|Loan||Loans can be availed against this policy as per the following table:
|Free look period||15 days from the date of receiving policy documents|
|Alterations||No alterations permitted|
|Nominations||Nomination facility provided as per the Insurance Act|
|Maturity Sum assured||
|Policy coverage||Maturity Benefit, Death Benefit and Loyalty Additions|
Benefits of LIC Jeevan Shikhar
- Maturity benefit – On maturity of the policy, the policyholder will receive the Maturity Sum Assured plus Loyalty Addition, if any.
- Death benefit – In the unfortunate event of death of the policyholder within the first 5 policy years, the Single Premium paid will be returned (if commencement of risk has not happened) or 10 times the Single Premium paid will be disbursed (if period of risk has commenced). On death at any point after the first 5 policy years but before maturity of policy, 10 times the Single Premium amount plus Loyalty Additions, if any will be disbursed to the nominee.
- Loyalty Addition – This policy is participating in nature and profits will be disbursed as Loyalty Addition on surrender, death or maturity as per policy terms, with the amount declared by the company.
- Tax benefits – Tax benefits are available as per relevant sections of the Income Tax Act, 1961.
- Rebate – Rebates are available on premium amounts of Rs.2 lakhs or more as per the following table:
|Maturity Sum Assured||Reduction in Premium amount per Rs.1,000 of maturity sum assured|
|Rs.2 lakhs to Rs.4.8 lakhs||Rs.15|
|Rs.5 lakhs to Rs.9.8 lakhs||Rs.20|
|Rs.10 lakhs and above||Rs.25|
- Loans – Loans are available as per the table given in the ‘Key Features’ section above.
- Surrender Value – On surrender of the policy at any point during the policy tenure, a Guaranteed Surrender Value will be returned to the policyholder. (a) If policy is surrendered in the first year, 70% of Single Premium will be returned. (b) If policy is surrendered after the first year, 90% of Single Premium will be returned. (c) If policy is surrendered after 5 years, 90% Single Premium plus Loyalty Addition, if any will be returned to the policyholder.
Example of LIC Jeevan Shikhar Policy
Let’s say Mr Gupta is 30 years old and has decided to buy LIC Jeevan Shikhar Policy for the fixed term of 15 years. He pays Rs.42,580 as Single Premium towards his policy for a Sum Assured of Rs.4,25,800 and Maturity Sum Assured of Rs.1 lakh.
- On his unfortunate death within the first 5 policy years, he will receive a lump sum of Rs.4,25,580 as death benefits.
- On his death after 5 policy years, he may receive Loyalty Addition on top of the Death Benefit amount. Let’s assume he receives variable amount at 8% p.a.:
|End of Policy Year||Loyalty Addition (Rs.)||Sum Assured on Death (Rs.)||Total amount of benefit (Rs.)|
Maturity benefits will be paid out to Mr Gupta on survival at maturity of policy (end of 15th policy year). He will receive the Maturity Sum Assured of Rs.1 lakh plus Loyalty Addition at 8% p.a. which comes to Rs.3,200 at the end of the 15th policy year. Therefore, he will be paid an amount of Rs.1,03,200 on maturity of the policy.
Riders are not available with this policy.
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GST of 18% is applicable on life insurance effective from the 1st of July, 2017