This is a microinsurance product for lower income groups to have a rock-solid instrument that acts as an investment, savings tool, and an LIC insurance policy. It’s a non-participating limited payment protection plan which returns a total of 110% of the premiums paid on plan maturity to the surviving policyholder, or pays out a death benefit to the dependents of the policyholder in the case of his/her demise.
Key Features of LIC Bhagya Lakshmi Plan
- Non-participating limited payment protection oriented plan.
- Minimum sum assured is Rs.20,000.
- Maximum sum assured is Rs.50,000.
- Premium payment modes available are monthly, quarterly, half-yearly, yearly, and single payment.
- Extended grace period of up to 60 days from the premium due date (two calendar months).
- The plan offers rebates of 2% of tab premium in the yearly mode.
- The plan offers rebates of 1% of tab premium in the half-yearly mode.
- There is no rebate for high sum assured options.
- The minimum premium paying term is 5 years.
- The maximum premium paying term is 13 years.
- The policy term will be the premium paying term + 2 years, hence:
- Minimum policy term is 7 years.
- Maximum policy term is 15 years.
Benefits of LIC Bhagya Lakshmi Plan
- Death Benefit:
In the unfortunate event of the demise of the life insured, his / her dependents will be paid a sum equal to the sum assured chosen.
- Maturity Benefit:
In the event that the life insured survives till the end of the policy term, he / she will be paid a maturity benefit that is equal to 110% of the total premiums payable during the policy term (not including taxes or extra premiums).
- Surrender value:
Paid up value / surrender value will accrue based on the following conditions:
- For policies with a premium paying term less than 10 years: after 2 full years’ premiums are paid.
- For policies with a premium paying term greater than 10 years: after 3 full years’ premiums are paid.
Eligibility Criteria of LIC Bhagya Lakshmi Plan
- Entry age:
- Minimum: 18 years.
- Maximum: 55 years.
- Maturity age:
- Maximum: 65 years.
Mr. Babu has a wife and child, and he is the only earning member of his family. He opts for this plan, for a sum assured of Rs.50,000 and a policy term of 15 years, paying premiums annually.
He will pay premiums for 13 years, getting a rebate of 2% on his premiums because of the payment mode option chosen.
In the event that he dies during the coverage term, his family will be paid the sum assured of Rs.50,000.
If he survives 15 years till the maturity date, he will be paid 110% of the premiums he’s paid so far.
- Is there a high sum assured rebate in this plan?
No, there is no rebate for higher sum assured options with this plan.
- What are the accepted conditions for rebate under this policy?
Rebates are given at the rate of 2% of tab premium in the yearly premium payment mode. Rebates are given at the rate of 1% of tab premium in the half-yearly premium payment mode.
- What are the premium paying modes available?
Premiums can be paid in monthly, quarterly, half-yearly, and yearly modes.
- When does paid up value / surrender value accrue?
Surrender / paid up value accrues after the premiums for 2 full years have been paid for policies with a premium paying term less than 10 years. Surrender / paid up value accrues after the premiums for 3 full years have been paid for policies with a premium paying term greater than 10 years.
- What are the sum assured options under this plan?
Policyholders can choose a sum assured that’s between Rs.20,000 and Rs.50,000 - depending on the amount of coverage that’s required.
*Please note that all amounts, tenures, repayment requirements, time frames, interest rates, other rates, charges, fees, ceilings, requirements, criteria, features, benefits, exclusions, calculations, ratios, ratings, terms and conditions mentioned above are as of January, 2016, and are subject to change at any time. All banks / NBFCs / insurance providers / financial service providers / companies, etc. mentioned above retain all rights to modify, replace, or add to or subtract from any of the above, in any way, at any time, and at their own discretion. You are requested to reconfirm the same with your chosen bank / company / NBFC / insurance provider / financial service provider, etc. before making any financial commitments.