Life Insurance Corporation of India, better known as LIC, is one of India’s most-trusted and most-popular insurance companies. For more than 60 years, LIC has been offering a plethora of insurance policies to millions of people. This veteran Corporation is also preferred for its policies that come with no-hidden costs as well as a swift claim settlement. One of their very famous policies is LIC’s Jeevan Rakshak Policy.
A participating non-linked plan, LIC’s Jeevan Rakshak offers dual benefits of safety and savings. It is a simple Endowment Plan with features of profit sharing. The plan provides a death benefit to the appointed nominee in case the insured individual expires before the policy matures. Not just that, maturity benefit is provided if the policyholder outlives the policy. He has to pay the required premium regularly for the entire term of the policy. Once the policy reaches its age of maturity, the individual will receive the sum assured and the loyalty additions.
The biggest of investing in LIC’s Jeevan Rakshak Policy is that it is an LIC policy. There is an element of trust attached to the Corporation. The many other advantages of this policy are given below:
The Death Benefit is the sum assured on death, which is calculated as the higher of:
Maturity Benefit = Basic Sum Assured + Loyalty Additions
Gupta, a 35-year-old non-smoker, buys the Jeevan Rakshak Policy with a sum assured of INR 1 lakh, Policy term and a payment term of 20 years each.
Based on these criteria, the annual premium he would pay would be around INR 3,587. The plan would work differently in different scenarios.
Given below is a sample premium and the corresponding Sum Assured for a 35-year-old male. The premium amount on the yearly mode is mentioned in INR, for a policy term of 20 years.
|Age at Entry||35 years|
|Policy Term||20 years|
|Basic Sum Assured||INR 1,00,000|
|Amount of Single Premium||INR 3,587|
As the policy did not complete 5 years, there would be no loyalty additions.
So, the nominee would receive only Rs 1 lakh as the death benefit and the policy would terminate.
The nominee would be eligible to receive the loyalty additions as well.
So, the nominee would receive Rs 1 lakh + Loyalty Addition as the death benefit and the policy would terminate.
|Age of Entry||8 Years||55 Years|
|Sum Assured||INR 75,000||INR 2 Lakh|
|Policy Term||10 Years||20 Years|
|Maturity Age||70 Years|
if the policyholder commits suicide within 1 year of buying the policy, 80% of the premiums that have been paid are given to the nominee. If in case, the policyholder does so within 1 year of police revival, the nominee would then receive the higher of 80% of the paid premiums or the acquired surrender value.
Jeevan Rakshak Policy can be purchased online by visiting the official website of the Corporation. The premium calculator gives a clear picture of how much the premium would be. The policy can also be purchased through registered agents and brokers or by visiting any LIC branch office. A few documents are required when applying for the policy. They are:
In case the policy holder dies during the term of policy, the nominee has to submit the claim form along with policy documents. He also needs to provide death certificate, medical details and the bank account details.
If the insured individual outlives his policy, he has to submit a duly signed Claim Form, original papers of the policy and the bank details for smooth transfer of the maturity amount to his account.
To claim the surrender value, the policy holder needs to submit the Claim Form, original documents of the policy and the bank account details.
LIC Jeevan Rakshak Policy is a participating non-linked plan, LIC’s Jeevan Rakshak offers dual benefits of safety and savings. It is an extremely cost-effective and affordable plan for low-income people.
The policyholder can get LIC’s Accidental Benefit Rider to his policy.
To avail the Surrender Value, the insured individual should have paid all his premiums regularly for the first three years of policy term. After three years only the policy accumulates a surrender value.
The policyholder has a grace period of 15 days in case the premium paying frequency is per month. In case of quarterly, semi-annual and annual frequency the grace period is of 30 days. If the policyholder does not pay his dues within this period, the policy will lapse.
If the policy lapses the policyholder can revive it within a time period of two years from the first unpaid premium date. But the revival has to be done before the maturity date.
If the policyholder does not pay the premium even in the grace period, the policy will lapse. However, the policyholder can revive it within a time period of two years from the first unpaid premium date. But the revival has to be done before the maturity date.
If the suicide is committed within 1 year of buying the policy, 80% of the premiums that have been paid are given to the nominee. If in case, the policyholder commits suicide within 1 year of police revival, then the nominee receives the higher of 80% of the paid premiums or the acquired surrender value.
By paying just a small amount the Accident Benefit Rider can be added to the plan. With this rider, if in case the policyholder dies in an accident, during the term of the policy, the nominee would receive an extra amount apart from the sum assured.
The death benefit under LIC’s Jeevan Rakshak Policy is free from taxation under Section 10 (10D).
Other LIC’s Endowment plans