The LIC Jeevan Labh Plan is an excellent option for those seeking savings and life insurance. It is a limited premium-paying endowment plan that offers financial security to the policyholder during the policy period.
Under this plan, a lump sum payment is made at the end of the policy period, providing life insurance protection and the benefit of higher returns after maturity.
The minimum entry age for this policy is eight years, and the maximum age depends on the premium payment period.
The maximum age is 59 for a 16-year policy term, 54 for a 21-year policy term, and 50 for a 25-year policy term. The maximum age for plan maturity is 75, and the premium payment period options are 10, 15, and 16 years.
The policy term options are:
- 16 years (with a 10-year premium payment period)
- 21 years (with a 15-year premium payment period)
- 25 years (with a 16-year premium payment period)
The Jeevan Labh policy has a minimum sum assured of Rs. 2 lakhs with no maximum limit. It includes maturity benefit, death benefit, simple reversionary bonus, and final bonus.
Key Benefits of LIC Jeevan Labh Plan:
1. Maturity Benefit: Once the policy matures, the policyholder receives a lump sum that includes the basic sum assured and additional bonuses.
2. Death Benefit: In case of the policyholder’s death, a death benefit is paid, which includes a simple reversionary bonus and additional bonus, along with the ‘sum assured on death.’
The nominee receives either ten times the total annual premium or the basic sum assured, whichever is higher. No less than 105% of the premium paid on the date of death will be paid to the nominee.
3. Profit Participation: Policyholders are eligible to receive simple reversionary bonuses on full premium payment, and an additional bonus is received upon maturity or death claim.
4. Tax Benefits: Tax benefits are available under the Income Tax Act sections.
5. Loan: The policyholder can avail of loans per the policy’s terms.
6. Rebate: Various rebates are available based on premium frequency and sum assured amount.
7. Surrender Value: The policy can be surrendered after paying premiums for at least three consecutive years, with the guaranteed surrender value based on the total premium.
Example of Jeevan Labh Policy: Let’s consider a person who opts for the LIC Jeevan Labh plan for 25 years with a 16-year premium payment period and an annual premium of Rs. 2 lakhs. At age 35, the person pays a yearly premium of around Rs. 9,980 (first premium).
On maturity after 25 years, they will receive Rs. 2.35 lakhs plus a bonus of Rs. 5.25 lakhs. In the unfortunate event of the person’s death during the 22nd policy year, the nominee will benefit up to Rs. 4.6 lakhs. Interest rates are subject to LIC policies.
For those looking to have a sum assured of crores of rupees, a person who opts for the LIC Jeevan Labh plan for 25 years with a 16-year premium payment period under an annual premium policy of Rs. Fifty lakhs should save around Rs. 650 per day.
For example, a 33-year-old individual paying a yearly premium of about Rs. 2,38,312 (first premium) will receive around Rs. 1.31 crore on maturity after 25 years.