LIC’s Money Back Plans

LIC’s Money Back Plans

The Life Insurance Corporation of India, LICI, is one of the largest life insurance companies in the Indian insurance market. It has the largest customer base and offers a range of insurance plans to its customers. Each insurance plan fulfils a particular financial need and, therefore, finds relevance among customers. Money back insurance plans are also a type of insurance plans which are offered by the company. Here is a look into money back plans and the variants of such plans offered by LIC –

What is money back policy?

A money back insurance plan is a traditional endowment assurance plan wherein the sum assured is paid at regular intervals during the term of the plan. Periodic payments are guaranteed under money back plans which are expressed as a percentage of the sum assured. Money back plans, therefore, provide liquidity during the policy tenure. They provide funds to the policyholder at specified intervals so that the policyholder can meet his financial requirements.

Salient features of money back plans

Money back insurance plans have the following features –

• Money back plans attract bonus declarations which increase the benefit payable
• The sum assured is paid in parts at pre-determined intervals during the policy tenure. On maturity, the remaining sum assured is paid with bonus
• Money back benefits are called survival benefits and they are paid only if the insured is alive at the time when the benefit is to be paid
• In case of death of the insured, the full sum assured is paid even if the money back benefits have been paid
• You can choose riders to enhance the coverage benefit
• Under many plans the money back benefit is paid in monthly instalments too which creates a regular monthly income

Money back plans offered by LIC

LIC offers a range of seven money back plans which are discussed below –

• LIC’s Bima Shree
  This LIC money back policy is meant for high net worth customers as it offers a high level of sum assured. The features of the plan are as follows –
  • The money back benefits and maturity benefit depends on the policy tenure selected
  • Guaranteed additions are added to the policy benefits during the premium payment term
  • Five additional riders are available with this LIC money back plan
  • You can choose to postpone the survival benefit to avail a higher benefit
  • Maturity proceeds and death benefit can be taken in instalments over 5, 10 or 15 years through settlement option
• LIC’s Jeevan Shiromani
  This LIC money back plan is also designed for high net worth individuals and so the sum assured level is high. The features of the plan are as follows –
  • This LIC money back plan has an inbuilt critical illness rider which covers 15 critical illnesses and pays a lump sum on diagnosis of any one illness
  • Besides the benefit payable under the inbuilt rider, you also get the option to defer premium payments and get a free medical second opinion
  • Guaranteed additions are added during the premium payment term in LIC’s Money back plan
  • Loyalty additions are added after the first five years of the plan
  • Four optional riders are also offered for better coverage
  • Premiums are payable for a limited period only
• LIC’s New Bima Bachat
  Bima Bachat is a single premium money back plan where you need to pay only a single premium to buy the policy. Other features of the plan include the following –
  • Loyalty additions are added to the death benefit if death occurs after the completion of the first five years of the plan
  • 15% of the sum assured is paid as money back benefits after every three years
  • On maturity, the single premium and loyalty additions are paid
  • Premium rebates are allowed if you choose a high sum assured level
• LIC’s New Money Back Plan – 20 years
  This money back policy has a fixed term of 20 years and survival benefits are paid at the end of every five policy years. The features of the plan are as follows –
  • 20% of the sum assured is paid as survival benefit
  • The plan earns bonuses depending on the profit experience of the company
  • One optional rider is available under the plan
  • Premium is payable only for 15 years
• LIC’s New Money Back Plan – 25 years
  This plan is a variant of the above plan with a difference that the coverage duration is 25 years. The features of the plan are as follows –
  • 15% of the sum assured is paid as money back benefit after every five policy years
  • Simple reversionary bonuses are paid every year the company earns a profit. In case of maturity or death, a final additional bonus might also be paid
  • Premium discounts are offered for the frequency of premium payment and the sum assured level that you select
  • You can also avail a loan under the plan
• LIC’s New Children’s Money Back Plan
  This is a child-oriented money back plan which is available for parents having minor children aged 0 to 12 years. The plan provides parents with the required funds to meet the education, marriage or other expenses of their children. The benefits of the plan are as follows –
  • Survival benefits are paid when the child attains 18 years, 20 years and 22 years of age so that the money can be used for meeting the child’s expenses
  • The bonus is added under the plan
  • 40% of the sum assured is paid on maturity
  • The survival benefits can be postponed to a later date in which case the benefit increases
  • Premium waiver rider can opt under the plan
• LIC’s Jeevan Tarun Plan
  This money back policy is also a child-oriented plan which promises to pay survival benefits at important milestones of a child’s life. The benefits of the plan are as follows –
  • There are multiple options of availing the survival benefit which you can choose from
  • Survival benefits are paid every year after the child attains 20 years till 24 years.
    Thereafter, on maturity when the child attains 25 years, the maturity benefit is paid
  • Optional premium waiver rider is available with the plan
  • The plan earns bonuses during the policy tenure