Unit linked plans offer you the dual benefit of insurance coverage and investment returns. These plans invest the premiums in market-linked funds thereby giving attractive returns as per market movements. LIC’s Money Plus Plan is one such unit-linked insurance plan which allows you to maximise your wealth through market-oriented returns.
Overview of LIC’s Money Plus Plan
As mentioned earlier, LIC’s Money Plus Plan is a unit-linked insurance plan which offers non-guaranteed market-linked returns. The premiums paid, net of allocation charge, are invested in selected funds. These funds, in turn, invest in capital market securities. Thereafter, as the market performs, the funds yield returns. Your investments, therefore, grow with the capital market. In case of premature death, the plan promises the payment of sum assured which helps fulfil your insurance needs. LIC’s Money Plus Plan is, therefore, a good combination of insurance and investment.
Key features of LIC’s Money Plus Plan
Here are some salient features of LIC’s Money Plus Plan which you should know –
- You can pay regular premiums or single premium for the policy
- There are four types of investment funds under the plan. These are the Bond Fund, Secured Fund, Balanced Fund and Growth Fund
- There are optional riders under the policy which help in giving you better coverage
- There are no charges on partial withdrawals and you can withdraw from your fund value freely
Benefits of LIC’s Money Plus Plan
LIC’s Money Plus Plan provides the following benefits to policyholders –
- Maturity benefit
If the term of the plan comes to an end, the available Fund Value is paid to the policyholder. You can avail the fund value in a lump sum or in instalments. The fund value is paid in instalments through the settlement option feature of the plan. Under this feature, the maturity benefit is paid over five years after maturity in equal instalments.
- Death benefit
If the insured is aged below 10 years, risk cover would start after two years of the policy, or, from the policy anniversary following the insured’s 7th birthday, whichever is later. If the insured is aged 10 years and above but below 12 years risk cover would start from the policy anniversary following the insured’s 12th birthday. In case of death of the insured when the risk cover has not started, the available fund value would be paid. Alternatively, if the insured is aged 12 years and above and he/she dies during the policy tenure, the death benefit would be higher of the sum assured or the fund value.
- Surrender value
You can surrender the policy and get the surrender value any time after the completion of the first three policy years. If you surrender the plan before the completion of three policy years, you would get the surrender value only after the completion of three years. The surrender value would be the fund value applicable on the date of surrender. You would not be charged any additional fee for surrendering the policy.
- Partial withdrawals
Since this is a unit-linked insurance plan, it allows you liquidity through partial withdrawals. Partial withdrawals are allowed under the plan after the completion of the first three policy years. You can withdraw any amount through partial withdrawals provided you maintain a minimum balance in the fund value. In case you pay regular premiums, the minimum balance which should be maintained in the fund value is two times the annual premium. In the case of single premium plans, the minimum balance in the fund value should be at least INR 5000.
Switching means changing investment funds. You can switch the entire fund value between any of the available four funds. Four switchings are allowed free of cost every policy year. For excess switches, a charge of INR 100/switch would be levied.
- Policy continuity benefit
If you have paid the premiums for at least the first three policy years and subsequent premiums are unpaid, the policy would continue. All the coverage benefits would be provided by the plan. You can make partial withdrawals from the policy if you want. The applicable charges would be deducted from the fund value which would continue to grow as per the market. However, if the fund value falls below one annualized premium, the policy would be terminated and the available fund value would be paid.
If, however, premiums for the first three years are not paid, the life insurance cover and rider cover would not be applicable. Your fund value would remain invested and appropriate charges would be deducted from it. If the fund value falls below one annual premium, the policy would be terminated and the fund value would be paid.
If the premiums are not paid on time, the policy lapses. You can revive a lapsed policy within two years from the date of the first unpaid premium. To revive you would have to pay the outstanding premiums, interest on them and proof of good health and the insurance company would revive your policy.
LIC’s Money Plus Plan offers two optional riders. You can choose one or both riders by paying an additional premium. The riders and their coverage are as follows –
- Accident Benefit Rider
If you choose this rider, you would get an additional sum assured in case of death due to an accident. The rider is available for a minimum sum assured of INR 25,000 and maximum sum assured of INR 50 lakhs. You can opt for the rider if you are aged 18 years and above.
- Critical Illness Benefit Rider
Under this rider, specified critical illnesses are covered. If you are diagnosed with any of the covered illnesses, you would get a lump sum benefit under the rider. The Critical Illness Benefit Rider is available if you are aged between 18 and 50 years and the term of the plan that you have selected is 10 years or more. The available coverage limit of the rider would be between INR 5000 and INR 5 lakhs.
Eligibility conditions of LIC’s Money Plus Plan
0 years to 65 years
18 years to 75 years
Term of the plan
5 years to 20 years
Regular premium – INR 5000
Single premium – INR 10,000
Minimum – higher of 5 times the annual premium or (0.5*term*annual premium)
Maximum – 20 times the annual premium
Minimum – 1.25 times the single premium
Maximum – up to 5 times the single premium
Charges under LIC’s Money Plus Plan
The following charges are levied by the policy –
- Premium allocation charge
This charge is deducted from the premium amount which is invested in the plan. The charge depends on the type of premium payment mode you have selected. It is as follows –
- For single premium plans
Amount of premium
Premium allocation charge
Up to INR 4 lakhs
4.25% of the premium
INR 400,001 to INR 6 lakhs
4% of the premium
INR 600,001 onwards
3.75% of the premium
- For regular premium plans
Charge in the 1st year
Charge in the 2nd and 3rd years
Charge from 4th year onwards
INR 5000 to INR 75,000
INR 75,001 to INR 1.5 lakhs
INR 150,001 to INR 3 lakhs
INR 300,001 onwards
- Risk cover charges
A mortality charge is deducted from the fund value depending on your age and the coverage offered by the plan. If you opt for the available riders, the additional charge would be deducted for the coverage offered by the selected riders.
- Policy administration charge
Charges incurred in administering the policy are called policy administration charges. These charges are charged @ INR 60 in the first month of the plan and INR 20/month thereafter. The maximum charge that can be levied by the company would be limited to INR 150 in the first month and INR 50/month from second month onwards.
- Fund management charge
The funds are managed by professional fund managers to whom a fee is payable for their services. Thus, the policy charges fund management charges which depend on the fund selected. The charges are as follows –
Type of fund
Fund management charge
0.75% up to a maximum of 1.50%
1% up to a maximum of 2%
1.25% up to a maximum of 2.50%
1.50% up to a maximum of 3%
- Miscellaneous charge
If you make any alterations to the policy like change of address, change of nominee, etc. a miscellaneous charge of INR 50 will be charged per alteration request subject to a maximum of INR 100.
How does LIC’s Money Plus Plan work?
Suppose you buy a regular premium policy paying INR 10,000. Your age is 35 years and you choose a term of 20 years. The sum assured is INR 2 lakhs. You invest the money in Secured Fund. Then, if the expected returns are 6% and 10%, the fund values at different intervals would be as follows –
Fund value @6%
Fund Value @10%
End of 5th policy year
End of 10th policy year
End of 15th policy year
End of 20th policy year
The fund value at the end of the 20th policy year would also be the maturity benefit payable under the policy.
The death benefit at the end of the 5th and 10th policy year would be INR 2 lakhs since the sum assured is higher than the fund value. However, as soon as the fund value exceeds the sum assured, the death benefit would be the fund value.
How to buy LIC’s Money Plus Plan?
LIC’s Money Plus Plan has been withdrawn by LIC. You, therefore, cannot buy a new policy. However, you can buy another unit-linked insurance plans which are available in the market.
To buy other unit-linked insurance plans, you can visit www.turtlemint.life-insurance and check out the list of the best unit-linked plans available in the market. You would just have to provide your details based on which the best plans would be recommended by Turtlemint. You can compare the available plans, choose one, fill up an online application form and pay the premiums online and you would be able to buy the best unit-linked plan through Turtlemint very easily.
Claim process of LIC’s Money Plus Plan
To make a claim for the maturity of the plan, you should fill up a claim discharge form and submit the same to LIC with your identity proof, policy bond and bank details. The company would process the claim and credit your bank account with the maturity proceeds.
For a death claim, you should fill up Form 3783 and submit it to LIC with the death certificate of the insured. Medical and police-related reports might also be required if death happened due to an accident. The company would assess the claim, verify the documents and pay the claim to the nominee or legal heirs of the insured.
Even Turtlemint helps you in making a claim under LIC’s Money Plus policy. If you had bought the policy through Turtlemint, you can inform the company by calling 1800 266 0101 or by sending a mail to firstname.lastname@example.org. Your claim would be intimated after which Turtlemint would take the necessary steps to get you the maturity or death benefit of the policy.