Life Insurance Corporation of India, which is better known as LIC, is one of the most-favoured and insurance companies in India. For over a period of 6 decades, 250 million people have associated themselves to the LIC. This veteran Corporation, because of its no-hidden costs plans and hassle-free settlements has been the first choice for most people. LIC’s New Jeevan Nidhi is also one such plan that has been very well-received.
If you are planning on investing your hard-earned money to fulfil your long-term goals, then LIC’s New Jeevan Nidhi plan might be the right choice for you. LIC’s New Jeevan Nidhi is a traditional pension plan that combines the advantages of saving as well as welfare. Under this plan, there is a death cover throughout the period of deferment. If the individual survives to the date of vesting he receives the annuity.
Death during First 5 Years
In case the insured individual dies within the initial 5 years of buying the policy, the appointed nominee receives the sum assured and the guaranteed additions in the form of
Death after First 5 Years
If the policy is active and the insured dies after 5 years of purchasing the policy, the appointed nominee will receive :
This amount can either be paid in the form of
If all the due payments have been duly paid then the death benefit received by the nominee will be more than 105% of the total premiums that have been paid. This amount does not include the extra premium and the taxes that may have been paid.
Benefit on Vesting
In case the life assured survives the date of vesting and if the policy is active, then he receives :
On the condition that the policy is active, a guaranteed benefit of INR 50/thousand of the sum assured is added to the sum assured for every year that the premium has been paid, for the first 5 years. This amount will be paid either on the specified date of vesting or on earlier death of the insured. If the policy is a single premium policy, the guaranteed additions are added to the sum assured on completion of each policy year for the initial 5 years.
Participation in Profits
On the condition that the policy is active and depending on the experience of LIC, the policies participate in the profits after the completion of 6 years. They are eligible for a Simple Reversionary Bonus, the rates of which are announced by LIC.
The premiums that are paid towards LIC’s New Jeevan Nidhi are tax-exempted under Section 80CCC till INR 1.5 lakhs per annum. The death benefit that is claimed is also liable to tax exemption under Section 10 (10D) of the Income Tax Act, 1961.
However, if the policyholder avails an annuity, then the annuity amount is not tax-free.
Accident and Disability Rider
The rider is available as a voluntary add-on, only under the Regular Premium Plans, by paying an extra amount of premium. If the rider has been attached to the plan and the plan and the rider are active, in case the insured dies an accidental death, along with the death benefit an accident benefit sum assured will also be paid to the appointed nominee. In case if the insured suffers disability due to an accident, the accident benefit sum assured is paid to him in the form of monthly payouts that are spread over a period of 10 years.
The eligibility conditions for New Jeevan Nidhi plan are as follows
|Minimum Sum Assured||For Regular Premium-INR 1 lakh; For Single Premium- INR 5 lakh|
|Maximum Sum Assured||No Limit. The sum assured must be in multiples of INR 5,000.|
|Minimum Entry Age||20 years|
|Maximum Entry Age||60 years|
|Deferment period||For Regular Premium-7 to 35 years; For Single Premium-5 to 35 years|
|Minimum Vesting Age||55 years|
|Maximum Vesting Age||65 years|
The premiums for New Jeevan Nidhi plan can either be paid as a Single Premium or on a regular basis. The policyholder can select a monthly, quarterly, bi-annual or annual frequency, as per his convenience.
If you are planning on investing your hard-earned money to fulfil your long-term goals, then LIC’s New Jeevan Nidhi plan might be the right choice for you. LIC’s New Jeevan Nidhi is a traditional pension plan that combines the advantages of saving as well as security.
The policyholder can get LIC’s Accidental Benefit Rider to his policy if he is paying a regular premium.
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 you do not pay the premium even within the grace period, the policy will lapse. However, you can revive it within a time period of two years from the first unpaid premium date. But, remember that the revival must be done before the date of vesting.
There is no provision of a loan under the New Jeevan Nidhi Policy.
The vesting date or date of vesting is the date from which the annuitant starts to receive the benefits of the policy, that is the regular inflow of income. This date begins the phase of distribution. Till the date of vesting the annuitant contributed to the policy, now he will start receiving the benefits.
The premiums for New Jeevan Nidhi plan can either be paid as a Single Premium or on a regular basis. The annuitant can select a monthly, quarterly, bi-annual or annual frequency, as per his convenience.
You have the option of surrendering your policy after 3 years, but avoid doing so unless there is no other option as you get a very small amount as a refund.
The premiums that are paid towards LIC’s New Jeevan Nidhi are tax-exempted under Section 80CCC. The death benefit that is claimed is also liable to tax exemption under Section 10 (10D) of the Income Tax Act, 1961. However, if the annuitant avails an annuity, then the annuity amount is not tax-free.