If you look at the history of insurance in India, LIC is surely a veteran. For many years LIC has been synonymous to life insurance. With over 250 million people associated to it, LIC is the most trusted insurance companies in the country. Over the past six decades, LIC has provided multiple insurance plans to its customers and one such plan is LIC’s New Jeevan Anand. The New Jeevan Anand plan, as the name suggests, is a plan that offers coverage till the time the insured individual is alive, even if the plan has matured.
A participating non-linked policy, New Jeevan Anand is the perfect combination of saving as well as safety. With the features of a traditional savings plan and an insurance plan, New Jeevan Anand Plan provides financial aid to the beneficiary/beneficiaries whenever the life insured dies. LIC’s New Jeevan Anand Plan is a whole life-cum-endowment plan. This dual-benefit makes it one of the most favoured endowment plans.
New Jeevan Anand, as discussed earlier, is a traditional participating whole life endowment policy. The other key features of the plan are as follows:
|Age of Entry||18 Years||50 Years|
|Sum Assured||INR 1 Lakh||No Limit|
|Policy Term||15 Years||35 Years|
|Maturity Age||–||75 Years|
Let us now take a look at the benefits of LIC’s New Jeevan Anand Policy which make it one of LIC’s most popular endowment plans.
Subject to 105% of all premiums paid till date
If the life insured dies within the policy tenure, the nominee would receive the Death Benefit which is:
Paid in lump sum and the policy continues.
Whenever the life insured dies, the Basic Sum Assured is paid to the nominee as a Death Benefit and the policy terminates.
The policyholder can select a premium paying frequency as per his convenience. The frequency can be annual, bi-annual, quarterly or even monthly.
To understand how the policy works, let us take the help of an expanse. Mr Menon is a 30-year-old businessman. He opts for the New Jeevan Anand Policy for a term of 35 years with a sum assured of INR 1 lakh.
Sample Premium rates
|Age (in years)||Policy Tenure = 15 years||Policy Tenure = 25 years||Policy Tenure = 35 years|
|20 years||79.05/ per INR 1,000 sum assured||44.3/ per INR 1,000 sum assured||29.95/ per INR 1,000 sum assured|
|30 years||82.45/ per INR 1,000 sum assured||46.75/ per INR 1,000 sum assured||32.3/ per INR 1,000 sum assured|
|40 years||88.2/ per INR 1,000 sum assured||51.4/ per INR 1,000 sum assured||37.1/ per INR 1,000 sum assured|
|50 years||97.7/ per INR 1,000 sum assured||59.65/ per INR 1,000 sum assured||NA|
|Age at Entry||30 years|
|Policy Term||35 years|
|Basic Sum Assured||INR 1,00,000|
|Amount of Annual Premium||INR 3165|
Annual Premium = 32.3/1000 * 100000 = INR 3,230
However, this plan offers high Sum Assured rebate and mode rebate for Annual premium payment, hence the premium = INR 3165
Let us see the two situations:
The policy nominee will receive 125% of the Basic Sum Assured along with the applicable bonuses, i.e. INR 1,00,000 + accrued bonuses, depending on the year of death.
|Annual Mode||2% of Tabular premium|
|Half-yearly Mode||1% of Tabular premium|
|Quarterly and Monthly||NIL|
High Sum Assured Discount:
|INR 1,00,000 to INR 1,95,000||NIL|
|INR 2,00,000 to INR 4,95,000||1.5% of Basic Sum Assured|
|INR 5,00,000 to INR 9,95,000||2.5% of Basic Sum Assured|
|INR 10,00,000 and above||3% of Basic Sum Assured|
New Jeevan Anand Policy can be bought only through LIC registered intermediaries such as a broker or an agent. The policy may also be purchased by visiting LIC office. Certain documents required at the time of purchase are subject to the amount of sum assured selected by the policyholder, however, the basic documents are as follows:
LIC will not treat any claim except to the limit of 80% of the paid premiums which would exclude taxes, rider premiums etc. Also, if the individual suicides within one year of policy revival, an amount that is higher of 80% of the premiums that are paid till the death of the individual or the surrender value, is payable to the nominee.
LIC provides its customers with a grace period of 30 days to pay the due annual, bi-annual and quarterly premium amount. The grace period for monthly premium payment is 15 days. In case the policyholder does not make the payment during this time, the policy will fail or lapse. However, the policyholder can still revive his policy within 2 successive years of the initial unpaid premium and before the end of the term of the policy.
Free Look Period
If the policyholder is not satisfied with the Jeevan Anand Policy, he can cancel it within 15 days of the commencement of the policy, if of course no claims have been processed.
When the policy gets 3 years old and all the premiums have been paid regularly, the policyholder is eligible to ask for surrender value. He can also apply for a loan against this value.
As per Section 39 of the Insurance Act, 1938, the policyholder is required to file nomination. If the policyholder wishes to change the nomination, a notice has to be submitted at the Company registration office, where the policy is maintained. LIC does not take any liability to the validity or the legal effect of the nomination.
LIC’s New Jeevan Anand Policy has the features of a traditional saving plan and an insurance plan. Not only does the plan provide financial aid in case the policyholder dies, but even if he outlives the policy, he still is eligible to receive a lump sum amount when the policy comes to an end. This dual-benefit makes it one of the most-chosen endowment plans.
For every year that the policy remains in force, New Jeevan Anand Policy offers simple reversionary bonuses. In both the cases, either death benefit or maturity benefit, apart from the vested bonuses, a final bonus may also be paid.
The rate of bonus for LIC plans is not fixed as it depends on the generation of profits. If you wish to see the rates applicable, you may visit the website for information: licindia.in/Customer-Services/Bonus-Information.aspx
If due to non-payment of premium the policy has lapsed, it can be revived during the policy holder’s lifetime, but within 2 successive years of the initial unpaid premium and before the end of the term of the policy.
New Jeevan Anand Policy will be void if the insured individual commits suicide within one year of date of onset of risk. The Corporation will not treat any claim except to the limit of 80% of the paid premiums which would exclude taxes, rider premiums etc. Also, if the individual kills himself within one year of policy revival, an amount that is higher of 80% of the premiums that are paid till the death of the individual or the surrender value, is payable to the nominee.
Yes, for every rider one has to pay an extra premium. However, the amount to be paid for the added rider is very nominal.
LIC provides its customers with a grace period of 30 days to pay the due annual, bi-annual and quarterly premium amount. The grace period for monthly premium payment is 15 days. In case you do not make the payment during this time, the policy will fail or lapse. Though you can revive it within 2 successive years of the initial unpaid premium and before the end of the term of the policy.
No. One of the greatest benefits of LIC’s New Jeevan Anand Policy is that no tax is to be paid when the policy matures. The policy is eligible under Section 80C and Section 10 (10D) of the Income Tax Act, 1961.
If you opt for a higher amount of sum assured and pay the premium on an annual or semi-annual basis, you can get a rebate in the premium amount.
Other LIC’s Endowment plans