Life Insurance Corporation of India, the largest state-owned insurance company in India was founded in the year 1956. LIC is a popular brand that has a widespread domestic and international presence with diversified life insurance product portfolio. Starting from traditional endowment plans to new age market-linked products, LIC has every type of life insurance product to offer for its diversified customer base. LIC Market Plus I plan is one such unit-linked plan that was specifically meant for retirement savings.

LIC Market Plus I Plan – an Overview

LIC market plus I plan is a unit-linked deferred pension plan that came with two options –with cover and without a cover plan. Though the policy is now withdrawn, it gave an option to choose the coverage level within the limits. Level of cover will be decided based on the single premium/regular premium options chosen by the policyholder.

Key Features of LIC Market Plus I Plan

There are various attractive features offered by the plan. Following are the features of LIC Market Plus I plan –

  • The plan is basically designed for retirement savings as it is a unit-linked deferred pension plan
  • Plan can be opted with life cover or without life cover depending on the requirement
  • Flexibility to choose the premium type –single premium or regular premium and mode of premium payment
  • Four different investment fund options to choose based on investment need and goal.
  • The added protection is offered by the policy with additional optional riders – life cover, accident benefit and critical illness benefit
  • The policy allows top-ups, wherein additional premium can be paid anytime during the policy term to contribute more to the corpus
  • Risk cover can be decreased during the policy term

Eligibility Conditions and Other Terms in LIC Market Plus I Plan

  • For LIC Market Plus without Life Cover
Minimum Maximum
Entry age

For Regular premium

For single premium

 

18 years

18 years

 

75 years

80 years

Vesting age 40 years 85 years
Sum assured Nil
Minimum deferment term

For regular premium

For single premium

 

10 years

5 years

Premium payment mode Single/yearly/half-yearly/quarterly/monthly (through ECS)
  • For LIC Market Plus with Life Cover
Minimum Maximum
Entry age 18 years 65 years
Vesting age 40 years 75 years
Minimum deferment term

For regular premium

For single premium

 

10 years

5 years

Sum assured

For single premium

For regular premium

With critical illness rider

-Age up to 40 years

-Age of 41 years and above

Without critical illness rider

-Age up to 40 years

-Age of 41 years and above

 

INR 30,000

INR 30,000

INR 30,000

 

Equal to single premium

10X annualised premium

5x annualised premium

 

20X annualised premium

10X annualised premium

Premium payment mode Single/yearly/half-yearly/quarterly/monthly (through ECS)

Benefits of LIC Market Plus I Plan

Following are the benefits offered under LIC Market Plus I plan

  • Death benefits:
    The policy can be opted with life cover or without life cover option. If the insured opts for a plan with life cover, the sum assured along with fund value on death is payable to the nominee as a Lump Sum or as a pension. In case, insured opts for a plan without life cover, then the fund value on death is payable to the nominee as a Lump Sum or as a pension.
  • Benefit on vesting:
    If the insured survives the policy period, the fund value of the policy will be utilised for paying pension based on the then prevailing immediate annuity rates under the relevant annuity option. However, the insured is allowed to commute up to 1/3rd of the vesting benefits and avail lump sum payment. 2/3rd will be used for purchasing annuities.
  • Flexibility benefit:
    The policy offers flexibility with many of its features. Policyholders are allowed to switch from one investment fund to another depending on the change in market conditions and risk profile. The policyholder can choose to decrease the policy coverage anytime during the policy term.
  • Additional benefits:
    Along with pension benefits, the policy offers various other additional benefits to the investor. Following are the additional benefits offered under the LIC market plus I plan –

    • Life cover benefit – policy can opt with life cover with sum assured chosen for protection. The chosen sum assured will be paid along with the fund value if the policyholder dies during the policy term
    • Accident benefit option – Insured can also opt for accidental cover ranging from INR 25,000 to INR 50 lakhs. In case insured dies due to an accident during the policy term, an additional sum equal to accident benefit will be payable
    • Critical illness benefit rider – Insured can also opt for critical illness cover ranging from INR 50,000 to INR 10 lakhs. On diagnosis of any listed critical illness to the insured during the policy term, the sum assured availed as critical illness benefit will be payable
  • Tax benefits:
    Premiums paid towards LIC market plus plan are eligible for tax deduction under Section 80C of the Income Tax Act. Commuted benefits paid out as a lump sum are tax-exempt under Section 10 (10D) of the Income Tax Act.

Investment Fund Options in LIC Market Plus I Plan

Following are the fund options available in LIC market plus plan

Fund type

Allocation

Equity shares Money market instruments Government securities/ corporate debt Risk/return profile
Growth fund 40% to 80% 0% to 40% Not less than 20% High risk/ Long-term capital growth
Balanced fund 30% to 70% 0% to 40% Not less than 30% Medium risk/ balanced income and growth
Secured fund 15% to 55% 0% to 40% Not less than 45% Lower to medium risk / Steady income
Bond fund Nil 0% to 40% Not less than 60% Low risk

Charges under LIC Market Plus I Plan

There are various charges applicable to this plan. Following are the major changes –

  • Premium allocation charges:
    These charges are deducted as a percentage of the premium received. After deduction of charges amount will be invested in chosen funds. Following are the details of allocation charges:

For single premium policies: 3.3%

For regular premium policies:

Premium range (per annum) Allocation charges
First-year Thereafter
INR 5,000 to INR 75,000 16.50% 2.50%
INR 75,001 to INR 1,50,000 15.75% 2.50%
INR 1, 50,001 to INR 3,00,000 15.00% 2.50%
INR 3, 00,001 to INR 5,00,000 14.25% 2.50%
INR 5,00,001 and above 13.50% 2.50%

Allocation charges applicable on the top-up premium is 1.25%

  • Fund management charges:
    Charges are levied as a percentage of units’ value while computing net asset value at the following rate:
Fund type Fund management charges
Growth fund 0.80%
Balanced fund 0.70%
Secured fund 0.60%
Bond fund 0.50%

Other charges include mortality charges, policy administration charges, switching charges, service charges and miscellaneous charges.

Surrender or Revival of LIC Market Plus I Plan

  • Surrender

Surrender in LIC market plus plan is allowed for cash only after completion of initial three years of the policy. This is applicable for both single premium and regular premium policies. As policy levies, nil surrender charges, fund value as on the date of surrender will be payable to the policyholder. In case insured surrenders the policy during the first three years, fund value on the date of surrender will be converted into monetary terms and be paid only after completion of three years of the policy. However, after surrendering the policy if insured dies within three years, fund value (converted to monetary terms) will be immediately paid to the nominee.

Compulsory surrender will be done in the following cases:

    • Premiums paid for less than three years or the fund value is not sufficient to recover the charges
    • Premiums paid for only three years or the fund value is not sufficient to recover the charges
    • Expiry of revival period and the policy is not revived
  • Revival

If the premiums are not paid within the due date for payment, the policy offers a grace period. If premium payment is not done within the given a grace period, the policy will lapse. A lapsed can be revived within two years from the date of first unpaid premium provided all premiums are paid with interest.

Exclusions in LIC Market Plus I Plan

Suicide exclusion: In case insured commits suicide within one year of the policy commencement or revival, there are no benefits paid except to the extent of the fund value of the policy as on the date of death.

Claim process in LIC Market plus I plan

Following is the process to initiate the claim in LIC market plus I plan

  • Intimation of the claim to LIC with details like policy number, date of death, name of claimant, cause of death and contact details etc.
  • Submit the necessary documents. Document requirement may vary depending on the claim nature and cause of death. Following are the main documents to be submitted:
    • Policy documents
    • Death certificate
    • Age proof of life assured
    • A medical certificate, etc.
  • Once the documents are verified, the claim will be honoured or denied.

FAQ’s

Net asset value is the per-unit price of the fund. LIC market plus NAV is computed on a daily basis depending on the fund performance in the market. Net asset value is calculated as –

NAV = total net assets / total number of units issued


No. There is no partial withdrawal of units allowed in LIC market plus I plan.


Yes. A grace period of 15 days to 30 days (depending on the mode of premium payment) is given.


No. There is no loan facility offered in the LIC market plus plan.


Yes. The policy offers a free look period of 15 days within which policy can be cancelled with the reason for cancellation stated.

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