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LIC Nav Jeevan Plan

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About LIC of India

The LIC of India is one of the most prominent and promising insurance companies in the country. The insurance provider is known to create tailor-made policies to suit the requirements of the masses and provide exclusive benefits to the customers. From the last few decades, the customer base of the insurer has increased manifolds owing to a range of policies launched in the interest of people.

The policy attracts several people for its reliability, exclusive benefits, the company’s strong financial stand, to safeguard the future of the family, and to get major tax benefits of owning an insurance policy.

Life insurance is a product that has become important in these uncertain times. As most people today have to maintain a particular lifestyle, a standard of living, and to support the family, it becomes crucial to ensure the life of the breadwinner. Life insurance comes as a major relief in such cases where the major earning member of the family dies in an unfortunate event.

The policy in the name of the insured can help the family in being financially independent and maintain their lifestyle. To avail the benefits of life insurance and to provide financial security to the family, the insured has to pay a premium amount to the insurer till the end of the policy term.

During this premium payment period, if the insured dies, the insurance company is bound to pay a sum assured to the nominee of the policy. It is up to the discretion of the nominee, how to use the sum assured paid by the insurance provider.

There are many types of life insurance policies available in the market and one should buy based on their needs and requirements. As the premium of every product is different, one can choose to select just the basic cover or add multiple riders to provide excessive financial benefits.

The LIC of India has a series of insurance products under its ambit and one can select the policy based on his/ her requirement and financial abilities. Basic term insurance will provide only the death benefits to the family and in case the insured survives the policy term, there is no maturity benefit applicable to the policy.

On the other hand, a policy with maturity benefits not just provides a sum assured but also the investment benefits to the policyholder. The premium of a policy with maturity benefits is higher than a basic policy and one has to shell out more money.

LIC Nav Jeevan Plan - 853: Overview

Every year, the life insurance corporation launches a plan between the months of January and March to cater to the needs of the people who are looking forward to a policy to save the taxes. As most of the salaried people buy policies to save the taxes, LIC targets more business by launching the policy.

LIC Nav Jeevan plan is a non-linked, endowment plan which promises maturity returns and death sum assured to the nominee. In a non-linked plan, the amount invested by the policyholder in the form of the premium is not invested in the stock market. This provides security to the investment money as a stock linked investment can fluctuate as per the market situation. To get a defined return and safety of the premium along with the investment benefits, people prefer a non-linked insurance plan.

An endowment insurance plan like LIC Nav Jeevan provides a lump sum amount to the insured at the time of maturity and also ensures death benefits at the untimely death of the policyholder. Many people choose the endowment plans to get a good return on the invested amount and to get the sum assured protection for the family.

Eligibility Criteria for LIC Nav Jeevan Plan

The insurance plan provides coverage to the policyholders for a particular term and also provides maturity benefits to the survivors of the policyholder. It is a comprehensive insurance plan that provides financial assistance to the insured and the family in case of the untimely death of the insured and also serves the purpose of investment by providing maturity returns.

The plan gives the flexibility to the applicant to pay the premium in either one go (Single premium payment) or by limited premium payment for the term of 5 years. For the convenience of the customers, the policy is available both in online and offline modes. The application process is easy, and one needs to submit the documents online or by reaching out to the local office of the insurance provider.

The insurance plan is available for the ages of 90 days to 65 years, and one can choose the sum assured from the age of 45 years onwards. The insured can get tax benefits on the insurance plan on the premium paid up to Rs. 1,50,000 to the insured. The premium amount is deductible from the taxable amount of the insured.

Minimum Sum Assured Rs. 1,00,000
Maximum Sum Assured No Limit on the sum assured
Minimum Entry Age Single-Premium: 90 daysLimited Premium: 90 days under Option 1 Limited Premium: 45 years under Option 2
Maximum Entry Age Single-Premium: 44 yearsLimited Premium: 60 years under Option 1 Limited Premium: 65 years under Option 2
Maximum Maturity Age Single-Premium: 62 yearsLimited Premium: 75 yearsunder Option 1 Limited Premium: 80 years under Option 2
Policy Term 10 to 18 years
Mode of payment Single-Premium (Lump sum), Yearly, Half-yearly, Quarterly, Monthly

LIC New Plan Features and Details

The endowment policy launched by the LIC has the following features to provide convenience to the customers. The policy is an exclusive plan launched by the LIC of India to cater to the needs of people:

Online Availability 

The policy is available on the web portal of the LIC and anyone can purchase the policy by paying the premium amount to the insurance provider. The online availability ensures that people don’t have to visit the office of the insurance provider and all the documents and details can be submitted online. To purchase the policy, one has to visit the official website of LIC and search for the LIC Nav Jeevan plan.

The portal will open the window where all the necessary details like name of the applicant, permanent address, present address, contact details, email are to be submitted. The documents required will have to be uploaded on the portal and will involve address proof, personal identity proof, proof of age of the applicant, personal identity proof of the nominee.

Once all the details are processed, the applicant can pay the premium amount. A provisional policy will be immediately generated and sent to the email address of the new insured. The hardcopy of the policy will be sent to the registered address of the insured by the insurance provider.

Premium Payment Option

The policy is available with two payment premium options, Single premium payment in which the full premium amount has to be paid to the insurer in one transaction. While the online payment of a single premium plan gets a discount of 2% to the insured on the whole amount, the limited premium option of 5 years gives the insured a discount of 5% on the premium amount. If an applicant is purchasing the policy from the local office of the LIC, the offer must be checked with the local authorities.

Flexible Sum Assured

The plan provides a minimum sum assured of Rs. 1 lac to the insured and there is no limit to the maximum amount. This gives options to the applicants to choose the benefits which will suit their requirements as the premium amount will depend on the sum assured. A higher sum assured can be opted by the people who need to provide maximum financial security to their family and also an investment product for assured returns.

Income Tax Benefits

As per the income tax act, 1961, a policyholder gets the tax benefits on the premium paid towards the insurance. The maximum tax benefits that can be availed is up to Rs. 1,50,000. The amount can be deducted from the taxable income and the tax is applicable to the net amount. LIC Nav Jeevan also serves the purpose of the policyholders to get a great discount on the income tax and provide financial stability to the family.

Loan Facility

Loan against life insurance policies is available only on some of the policies which have any money-back guarantee. As LIC Nav Jeevan plan is an endowment policy with the maturity benefits available to the insured, it can be pledged by the policyholder to get a loan against the policy. The loan amount generally varies between 85 to 90% of the surrender value of the policy. To check the details regarding the loan facility offered by the insurance provider, one can visit the web portal of the LIC of India which has all the details regarding the documentation and the amount which can be availed.

Riders

Riders are the insurance plans which can be bought with the insurance policies to get maximum security for the insured and the family. An insurance plan will only cover the uncertain death of the insured, to get the benefits like accidental death cover, critical illness plan, and permanent or partial disability, the insured can purchase the riders.

The premium of the riders are very small in comparison to the premium amount of the whole new policy, In case of death of the insured in an accident, the basic life insurance will pay for the death benefits and the rider will pay for the sum assured promised while purchasing the rider. This gives exclusive cover to the insured as the family will get more financial stability and independence.

Grace Period

Every policy has a grace period that provides a certain number of days to the insured to pay the premium amount in case he/she has missed out on paying the premium on or before the due date. During the grace period, if the insurance holders fail to pay the premium, the policy stands cancelled. The LIC Nav Jeevan plan has a grace period of 30 days, after which the insurance will stand cancelled.

Free Look Period

In a scenario that the policy buyer is sure about the benefits and the features provided with the policy, he /she can opt for the free look period during which the buyer can understand the policy terms and conditions and can decide if it is good to continue with the policy.

During the free look period, if the buyer is not happy with the policy and wants to surrender, the premium amount paid while buying the policy is returned. The LIC Nav Jeevan plan offers a free look period of 15 days to its new buyers.

Death Benefits in Installments

The policy offers the death benefits in installments to the nominee over the period of 5, 10, or 15 years as selected by the insured.

Maturity Benefits

In the LIC Nav Jeevan endowment insurance plan, the insured has to pay the premium amount to get the death benefits and the maturity benefits. If the insured survives till the end of the policy term, the maturity benefit will be paid out by the insured.

Death Benefits

In the event of the death of the policyholder, the death benefits will be paid out to the nominee in the following manner:

Death during the first five years of buying the policy: The death occurs before the date of the start of the risk, only the premium amount paid during the survival phase without any interest will be paid out to the nominee.

If the insurance holder dies after the date of the start of the risk, the sum assured on death will be paid out to the nominee.

Death of the insured after the completion of 5 years of the policy but before the maturity date will result in paying out of sum assured with the loyalty addition.

Sum Assured in Option 1 & 2 in LIC Nav Jeevan Plan

For Single Premium Payment: The policyholders who have opted for a single premium payment plan, the sum assured offered by the insurance provider is 10 times of the annualized premium

The insurance policy offers 2 options to the insured, which opt for limited premium payment.

When the insured is below the age of 45, then the insurer will pay 10 times the annualized premium as the death benefit to the nominee.

When the insured is above the age of 45, there are two options to choose from:

  • Option 1 - The policyholder can choose 10 times of the annualized premium as the death benefit
  • Option 2 - The policyholder can choose 7 times of the annualized premium as the death benefit

The difference that the policyholder will see is in the premium amount to be paid to the insurer. Option 2 is with a higher sum assured as the death benefit attracts a higher premium amount than option 1. It is left to the discretion of the applicant to choose between the options as per his/ her paying capacity and the financial security required for the family.

LIC Nav Jeevan Plan Premium Calculation

Example 1

Single-Premium Payment Plan

Basic Sum Assured: Rs. 2,00,000

Policy Term: 12 Years

Age of the applicant: 27 years

Premium (Single) GST (@ 4.5%) Total Premium
109800 4941 114741

 

Basic Sum Assured 200000
Death Sum Assured 1138000
Death Claim before 5 years 1138000
Death Claim between the 5th policy year and the12th policy year 1138000+ Loyalty Addition (LA)

Maturity after 12 Years

200000 + Loyalty Addition (LA)


Example 2

Limited Premium Payment- Option 1

Basic Sum Assured: Rs. 5,00,000

Premium Payment Term: 5 Years

Policy Term: 15 Year

Age of the applicant: 24 years

Mode Premium (Rupees) GST (@4.5%) (Rupees) Total (Rupees)
Yearly 54900 2471 57371
Half Yearly 27450 1235 28685
Quarterly 13725 618 14343
Monthly 4575 206 4781

 

Basic Sum Assured 500000
Death Sum Assured (Yearly Mode) 584000
Death Claim before 5 years 584000
Death Claim between the 5th policy year and the15th policy year 584000+ Loyalty Addition (LA)
Maturity after 15 Years 500000 + Loyalty Addition (LA)


Example 3

Limited Sum Assured- Option 2

Basic Sum Assured: 4 Lakh

Premium Paying Term: 5 years

Policy Term: 10 Years

Age: 45 Years

Mode Premium (Rupees) GST (@4.5%) (Rupees) Total (Rupees)
Yearly 58720 2642 61362
Half Yearly 29360 1321 30681
Quarterly 14680 661 15341
Monthly 4893 220 5113

 

Basic Sum Assured 400000
Death Sum Assured (Yearly Mode) 425040
Death Claim before 5 years 425040
Death Claim between the 5th policy year and the10th policy year 425040+ Loyalty Addition (LA)
Maturity after 10 Years 400000 + Loyalty Addition (LA)

Exclusions of LIC Nav Jeevan Policy

Death of the Insured by suicide while claiming the policy, the death certificate of the insured has to be submitted to the insurance provider. The medical examiner will determine the cause of the death and if it happens to be because of the self-inflicted injuries or suicide by the insured, then the insurer has the right to reject the claim filed by the nominee. The rejection will be irrespective of the insured being sane or insane at the time of committing suicide.

Exclusion in Accidental Death Benefit Rider

In case of the death of the insured in unnatural circumstances, which is investigated by the insurance provider at the time of setting the claim, the claim of the rider can get rejected. Sum assured by the critical illness rider, or accidental death benefit rider is not paid by the insurer in the following cases:

  • Consumption of narcotic substances leading to the death of the insured
  • Consumption of alcohol leading to the death of the insured
  • Death caused by the internal conflicts in the country by civil war, internal agitation, chemical or biological attack by another country
  • Death caused by taking part in a dangerous sports activity like sky diving, scuba diving, water rafting, mountain climbing, underwater swimming, and any other activity considered dangerous by the insurer
  • Death caused by pre-existing illnesses
  • Death because of the complications arising from childbirth or pregnancy

In case death happens due to lifestyle issues like smoking or consuming alcohol, the insurance company can deny the claim stating the hiding of information from the insurer. As smokers are charged a higher premium by the insurer because of the decreased life expectancy, hiding the information can lead to rejection of the claim by the company.

Premium Calculator for LIC of India

With the help of the online premium calculator, it has become quite easy for the applicants to check the amount of premium they will have to pay to the insurer to get the policy and the benefits associated with it. One has to submit some personal details online to get the premium amount for the policy.

The details associated are, name of the applicant, age, date of birth, the sum assured required, premium payment plan, whether going for single premium payment or limited premium payment. By using the details, the premium calculator will provide the figure which the applicant will have to pay to the insurer to get the LIC Nav Jeevan plan.

If a person chooses a sum assured of Rs. 10 Lakh for 15 years, in a premium payment plan for 5 years, the premium applicable monthly will be Rs. 9,628 in the first year and from the second year onwards, the premium will be Rs. 9,430. Similarly, in a single payment plan of policy tenure of 15 years and sum assured of Rs. 10 Lakh, an applicant will have to shell out Rs. 5,01,287 for a single payment to the insurer.

The Claim Process of LIC Nav Jeevan Plan

The following steps are to be followed to make a death claim with the LIC of India:

  • Inform the Insurance Provider: The first and foremost step in filing a death claim under the policy is to inform the lie insurance corporation about the death of the insured. The information can be passed by visiting the local office of the insurer or by connecting with the insurer through helpline services.
  • Getting the claim intimation form is the step critical to officially filing the claim with the insurer. The claim form is also available on the website of LIC of India for the convenience of the customers
  • The documents required by the insurance provider to process the claim should be confirmed from the insurer

Documents Required to File a Death Claim with LIC of India

The following documents are required to be submitted by the policyholder for getting a claim processed:

  • Certificate of death is mandatory
  • Proof of age of the life insured is must if not provided at the time of purchasing the policy
  • Policy document stating the policy number
  • If the insured was admitted to the hospital, then a statement from the hospital is required
  • Certificate of a medical attendant of the deceased
  • A person present at the cremation or burial of the body of the deceased will have to provide the cremation or burial certificate
  • For an employee, the employer certificate of the deceased is required
  • A certificate from the airline authorities is required stating that the insured was a passenger in the flight if the insured dies in an air crash
  • A certificate from the shipping authorities is required stating that the insured was a passenger in the ship if the insured dies in a ship accident
  • A certificate mentioning the cause of the death of the insured
  • An FIR report, or the panchanama, post mortem is required to be submitted if the insured dies in a road accident

How to Buy LIC NAV Jeevan Plan?

To provide convenience to the applicants, the life insurance corporation of India provides some of the policies in the online mode, and the LIC Nav Jeevan plan can be purchased either online or offline at the regional office of the insurer.

Steps leading to buying a term life insurance plan from LIC are listed below:

Step 1: An applicant should confirm the details of the plan with the insurer regarding the premium amount, policy term, mode of premium payment, frequency of the premium payment and the sum assured of the policy.

Step 2: Check the documents required by the insurance provider to purchase the policy once the required details are finalized.

Step 3: The premium amount can be paid either in an online mode or by reaching out to the regional office of the insurance provider.

Step 4: The insurance provider will start the policy effective from the date of the payment after documents checking and validation and payment receipt.

Step 5: The policy copy is mailed to the registered address of the insured provided at the time buying the policy.

Documents Required to Purchase LIC Nav Jeevan Plan

Following documents are required to purchase LIC Nav Jeevan plan:

  • The details of the insured like the name, present and permanent address, contact number, the email address should be mentioned in the proposal form  
  • Permanent address proof like Aadhar card, voter ID card, driving license or passport
  • Identity proof of the applicant like PAN card, passport, Aadhaar card, driving license, ration card, attested bank statement or passbook
  • Photographs of the applicant
  • Copies of the government identity card of the nominee
  • Age of proof of all the applicants and the nominees
  • Occupational details of the applicant and the nominee

Things to Check before Buying LIC Nav Jeevan Plan

Insurance not just serves the purpose of insuring the life of the insured but also provides financial benefits to the family in case the insured dies and gives maturity benefits to the insured if he/she survives the policy term.

One should always understand the requirements and the financial goals before investing in policy as a wrong decision might lead to an insured paying the premium and not getting the complete benefits.

LIC Nav Jeevan plan is an exclusive plan launched to cater to the tax savings needs of the individual and one can save on the tax liability by paying the premium amount associated with the plan. Some of the important features to consider before making a decision to buy the policy are discussed below:

Policy Term

As the policy term in the plan ranges from 10 to 18 years, it is crucial for the applicant to understand for how long he/ she wants to keep paying the premium. A long term policy term may create a burden on the insured to keep paying the premium and might also result in a financial crunch. For a short term financial goal, one can select a short policy term and avail the benefits accordingly.

Sum Assured

Although a high sum assured results in greater maturity benefits at the end of the policy term and more financial security to the family of the insured, it comes with a cost of the higher premium amount. Premium amount of the policy is directly dependent on the sum assured opted by the individuals, and selecting a higher sum assured might create a burden as well.

LIC Nav Jeevan plan provides the flexibility to the applicant to select from the minimum of Rs. 1 Lakh to any amount of the sum assured as per the requirements. One should select the sum assured based on the paying capacity so that the premium amount may not result in a financial crunch.

Premium Payment Frequency

LIC Nav Jeevan plan offers the insured to pay the premium in two methods, single premium payment and limited premium payment. A single premium payment will require the insured to pay the complete premium amount in a single transaction and can be quite difficult.

Applicants should understand their paying capacity and then deduce the premium payment plan. LIC of India is offering a discount of 2% on the single premium payment plan while paying online, and it is beneficial for the applicants.

Comprehending Policy Terms and Conditions

Many people are not in the habit of checking the terms and conditions in detail and regret when things don’t turn out in their favour. To some oneself from such a scenario, it is important to meticulously check the terms and conditions of the policy and discuss with the agents about the confusing terminologies and any queries regarding the premium amount, the sum assured payment, maturity benefits, any promotional discounts available.

The details of the LIC Nav Jeevan plan are also available online and one can read the policy terms at the convenience of their homes and decide if the policy suits their requirements.

Understanding Tax Benefits

While many people opt for the insurance plans to get tax benefits, but they do not understand the complete details. The max tax benefits one can get from the insurance is a deduction of Rs. 1,50,000 from the taxable income and a policy bought towards a single premium payment will result in a one-time deduction from the income.

It cannot be carried forward to the subsequent years. So if a person pays a premium amount of Rs. 2,00,000, the max deduction he/she is applicable for from the taxable amount is Rs. 1,50,000. It is important to understand the taxation terms and conditions before deciding to purchase a policy.

The Renewal Process for LIC Term Life Insurance

The life insurance policy bought from the LIC of India can be renewed either by paying the premium payment online or by reaching out to the local office of the insurance provider and paying the premium fee.

FAQs

    • Q1. What are the benefits of the endowments insurance plan?

      Ans. An endowment insurance plan provides not only a life cover but also gives the maturity benefits to the insured at the end of the policy term. The insured has to survive and pay the premium of the policy until the end of the policy term opted by him/her to be eligible for receiving the maturity benefits from the insurer. Endowment plans serve the purpose of the investment and can secure life as well. The insurer, in some cases, also provides the loyalty benefits to the insured, and that is payable at the end of the policy term along with the maturity benefits.

    • Q2. What parameters should be checked before buying an insurance plan?

      Ans. An insurance plan offers financial security to the family of the insured. Before buying a policy, there are certain parameters that one should check about the insurer and the policy.

      Claim Settlement Ratio: The number is an index showing the number of policies settled or paid back to the number of claims made. A higher CSR means the company has settled a larger number of claims, and the rejection of the claims is less. One should always go for an insurer, which has a higher CSR to ensure they get the claims settled at the time of emergencies. As per the IRDA report, the claim settlement ratio of the life insurance corporation of India was 97.79% in 2018-2018, which is a decent number for an insurance provider. CSR also reflects the financial stability of the company and its position to pay back the customers.

      2015 2016 2017 2018 2014
      98.33 98.31 98.04 97.79 98.00

      The solvency ratio of insurance providers: Solvency ratio measures the assets of the companies to pay back the future liabilities and payments. A higher ratio reflects the better financial position of the company having a higher number of assets to cover its payments. It can also be defined as the extra capital mandated by the IRDA for the insurance companies to hold at any point in time.

      Life insurance companies in India are required to maintain a solvency ratio of 1.50. Solvency ratio = net assets/ net premium written. As LIC is operating in India since 1956, it has always marinated a higher solvency ratio and is currently standing at 1.54.

      LIC solvency ratio over the year

      2010 2011 2012 2013 2014
      1.54 1.54 1.54 1.54 1.54
    • Q3. How will the claim be processed in life insurance if the policyholder and the nominee both die?

      Ans. In a scenario, the nominee dies before the policyholder when the policy is in force; then the policy nomination will become ineffective. The insured can choose a new nominee for the policy in such a case. However, if the insured and the nominee both die when the policy is in force, then also the nomination will become ineffective and only legal heirs of the insured can get the death benefits. The process will be carried out by the insurance provider and will require the legal heirs for the insured to be involved in processing. It is better to discuss this situation with the insurance company while buying the policy so as to have clarity about the processing of the claims.

    • Q4. In what scenario, the insurance provider can deny the claims made in an insurance policy?

      Ans. There are cases when the claims filed by the nominee have been rejected by the insurance provider. Check for the below scenarios to get a detailed picture:

      • Applicant shared incorrect information in the application form like lifestyle habits related to smoking, drinking alcohol
      • Medical history not stated in the application form: Any pre-existing illness, surgeries, or operation conducted on the insured before buying are policy is to be stated in the application form.
      • Non-payment of the policy premium resulting in the policy lapse
      • Nominee information not updated in the policy
      • Existing policies information should be given to the new insurer as a part of the disclosure process

      It is essential to maintain transparency with the insurance provider. Stating all the information in the application form will benefit the insured and the family in a smooth claim process.

    • Q5. Can I buy LIC Nav Jeevan Plan online?

      Ans. The LIC Nav Jeevan plan is available in both online and offline mode and by choosing to pay the premium online, one can also avail of the discount offered by the LIC of India.

    • Q6. Can LIC Nav Jeevan be purchased in the name of a minor?

      Ans. Yes, the policy can be purchased in the name of the minor also.

Written By: Paisawiki - Updated: 12 April 2021