LIC Savings Plan

In difficult times, saving becomes our lifesaver. LIC or Life Insurance Corporation of India offers a range of saving plans, which not only provide life cover but also helps accumulate funds for the future. The investment plan helps the policyholder invest in disciplined and systematic ways to achieve various long-term and short-term financial goals. LIC savings plans offer various benefits like the dual advantage of life protection and savings, which are integrated with financial assistance features. Life coverage plan provides accidental death protection, covers for partial and permanent disability of the policyholder, and protection against critical illness hospitalization. The wealth creation plans from LIC also come with guaranteed income, tax benefits, and loan facilities.

What are LIC Savings Plans? 

LIC has various types of plans customized according to customer needs. Some policies fulfil short term goals, whereas others fulfil long-term goals like securing retirement or a child's future. LIC Saving Plans are an excellent tool that provides short term & long-term financial goals, but they also assure a lump-sum on the death of the policyholder. There is a range of savings plans available. 

Why Should One Choose LIC Savings Plan? 

The reasons for choosing LIC Savings Plan are as follows:

  1. Technology-Based Company

    LIC has a technologically driven network to provide advanced and efficient services.

  2. Financial Shield

    LIC Savings Plan provides death benefits to support the nominee in case of policyholder's death.

  3. Easy Claim Settlement Feature

    The insurance provider aids customers, which helps in easier and faster processing. LIC has one of the highest Claim Settlement Ratio across the industry.

  4. Flexible Payment of Premium

    Most of the savings plans provided by LIC have flexible payment options.

  5. Digitally Driven Processing

    For premium payment processing, the insurance company has a digitally driven process.

  6. Riders

    LIC savings plans have various riders which cover accidental death and disability.

  7. Saving and Investment

    There are various saving plans which provide a lump-sum amount when the policy matures.

  8. Loan facilities

    The policy provider has loan facilities available for its customers.

  9. LIC Customised Plans

    There are various plans available for customers according to their needs.

  10. Tax Benefits

    There are tax benefits available for policyholders.

Types of LIC Savings Plan

Some of the best LIC policies for investment are:-

  • LIC Jeevan Labh
  • LIC New Jeevan Anand
  • LIC Jeevan Rakshak
  • LIC Jeevan Lakshya
  • LIC Jeevan Pragati
  • LIC Bima Diamond
  • LIC New Bima Bachat
  • LIC Jeevan Tarun 
  • LIC Single Premium Endowment Plan
  • LIC Bhagya Lakshmi Plan
  1. LIC’s Jeevan Labh

    LIC's Jeevan Labh is a non-linked limited premium paying policy. This is a savings cum endowment plan with profits. The policyholder gets the sum assured plus bonuses. The benefits offered by the policy are:-

    Policy Coverage:

    • Death benefit - On the death of the policyholder, the nominee receives the sum assured. The nominee also gets simple reversionary bonuses and final additional bonuses (if any)
    • Maturity benefit - On maturity of the policy, the policyholder gets the sum assured plus maturity benefit with any simple reversionary bonuses as well as additional bonuses
    • Rebate: In LIC Jeevan Labh policy rebate is available:
    • 2% on yearly premium
    • 1% on half-yearly premium payments
    • A rebate of 1.25% of the total sum assured is offered if the sum assured is Rs 5 Lakh to Rs 9.9 Lakh
    • A rebate of 1.50% of the basic sum assured is offered if the amount of sum assured is Rs 10 Lakh to Rs 14.9 Lakh
    • If the sum assured is above 15 Lakh and a rebate of 1.75% if offered
    • Loans: LIC Jeevan Labh offers loan facilities on completion of 3 years of the policy period. The policy must acquire a surrender value
  2. LIC New Jeevan Anand

    LIC New Jeevan Anand is a combination of the whole life plan and saving plus endowment policy. The plan provides cover in case of the sudden death of the policyholder.

    Policy Coverage:

    • Maturity benefit - On maturity of the policy, the policyholder gets: Sum assured on death + Vested Reversionary bonus + Final additional bonus (if any)
    • Surrender value - The policy acquires surrender value if the premium has been paid for three whole years. The surrender value is equal to a percentage of the total premiums paid
    • Loan Facility - A loan facility is available after the policy acquires surrender value
    • Death benefit - On the death of the policyholder, the nominee gets the sum assured on death plus reversionary bonus and final additional bonus (if any)
  3. LIC Jeevan Rakshak

    LIC Jeevan Rakshak is a participating endowment plan which provides savings and protection. Bonuses are offered in the form of loyalty additions after completion of 5 years. The benefits of the policy are:

    Policy Coverage:

    • Maturity Benefit - On maturity of the policy, the policyholder gets a basic sum assured with additions on loyalty
    • Death Benefit - On the death of the policyholder the nominee gets the sum assured is which the highest is of
    • Basic Sum Assured or
    • 10 times of the annualized premium, or
    • 105% of the total premiums paid till the date of death
  4. LIC Jeevan Lakshya

    This conventional endowment plan is useful in saving for the child's future. It offers a lump-sum amount irrespective of the survival of the policyholder at the time of maturity. The benefits offered by LIC Jeevan Lakshya are:

    Policy Coverage:

    • Maturity Benefit - On the maturity of the policy, the policyholder gets: 
    • Sum Assured on Maturity
    • Vested simple reversionary benefits
    • Final additional bonus, if any 
    • The Sum Assured on Maturity is the same as the Basic Sum Assured
    • Death Benefit – In case of death of the policyholder, the nominee gets:
    • A Sum Assured on Death
    • Simple Reversionary Bonuses
    • Final Additional Bonus (if any) 
    • Bonuses - The policyholder gets 
    • Simple reversionary bonus
    • Final additional bonus (if any)
  5. LIC's Jeevan Pragati

    LIC Jeevan Pragati is a non-linked plan in which the risk cover increases by a certain amount after every 5 years. This savings plan is perfect for those planning their retirement. It also has cover against accidents. The features of the plan are:

    Policy Term Period: 12 years to 20 years

    Policy Coverage:

    • Death Benefits - On the death of the policyholder, the nominee gets 
    • The sum assured with the bonus, which is either of the following:
    • Ten times the total annual premium, or 
    • Calculated as per the terms of the policy
    • Maturity Benefits - On maturity of the policy, the policyholder gets:
    • The sum assured with bonus + reversionary bonus for the full term of the policy
    • Tax Benefit - The premium paid is exempted from tax under section 80C
    • Loan Facility – It is available after the policyholder has paid a premium for at least three years
  6. LIC Bima Diamond

    LIC Bima Diamond is perfect for customers looking for a short-term investment saving plan with guaranteed return and added benefits. The features of the policy are:

    Policy Coverage:

    • Death Benefit: On policyholder's death, the nominee gets the death sum assured
    • If the death occurs during the extended term of the policy, 50% of the sum assured will be payable
    • Otherwise, it is equal to the sum assured
    • Survival benefit - On the survival, the policyholder will be entitled to the following survival benefits:
    • For a policy term of 12 or 16 years, 15% of the sum assured will be paid at the end of 4th and 8th policy year
    • For 16 year, the sum assured at the end of the 12th year will also be paid
    • For a policy term of 20 years, 10% of the sum assured will be paid at the end of each 4th, 8th, 12th & 16th policy year
    • Maturity Benefits- On maturity the policyholder gets the sum assured and the loyal additions
    • Addition Cover Period- In the case of non-payment of the premium for 5 policy years, an auto cover period of 2 years is offered
    • Maturity is calculated as:
    • It includes 55% of the basic sum assured for 16 years
    • It includes 45% of the basic sum assured for 20 years or 24 years
  7. LIC New Bima Bachat

    The LIC New Bima Bachat is a single premium plan. In this plan, the survival benefits are paid as money back. The features of the policy are:

    Policy Coverage:

    • Survival Benefits - On survival, the policyholder gets 15% of the basic sum assured after every three years
    • Maturity Benefits - On the maturity of the policy, the policyholder gets a lump-sum along with additions on loyalty
    • Death Benefits - On the death of the policyholder, the nominee gets the sum assured along with the loyalty additions
    • Surrender Value - The policy offers guaranteed surrender value, available after completion of one year of the policy. Guaranteed surrender value offered is equal to 90% of the single premium paid, excluding any extra premium paid
  8. LIC Jeevan Tarun

    LIC Jeevan Tarun is an endowment saving plan for children up to 12 years of age. It is the perfect plan for those parents saving for their child's future. The features of the policy are:

    Policy Coverage:

    • Survival Benefits- On survival, when the policyholder is not paying the premium, in the last 5 years
    • The survival benefits can be received in four different forms - 0%, 5%, 10% and 15% of the sum assured
    • Maturity Benefits - On maturity of the policy, the policyholder gets the balance sum assured plus the bonus after the completion of tenure of the policy
    • Death Benefits - On the death of the policyholder, the nominee gets the sum assured and the acquired bonus
  9. LIC Single Premium Endowment Plan

    LIC Single Premium Endowment Plan is a single payment plan in which a policyholder will have to pay a lump sum amount as a single premium. This is an endowment plan plus bonus, in addition to other benefits.

    • Maturity Benefit - On the maturity of the policy, the policyholder gets the sum assured plus additional bonuses
    • Death Benefit - On the death of the policyholder, the nominee gets the sum assured plus additional bonuses
    • Guaranteed Surrender Value - The policyholder gets 70% of the single premium paid if the policy is surrendered within 1 year of the commencement of the policy 
    • It receives around 90% of total premiums paid from the 2nd year onwards
  10. LIC Bhagya Lakshmi Plan

    LIC Bhagya Lakshmi Plan has features of investment, insurance, and savings plans. It offers maturity as well as the death benefit. The features of the policy are:

    Policy Coverage:

    • Death Benefit - On the death of the policyholder the nominee gets the assured sum
    • Maturity Benefits - On maturity of the policy, the policyholder gets a total of 110% of all the premiums paid
    • Surrender Value - Surrender value will be acquired based on the following conditions:
    • For policies of premium paying term less than 10 years, the surrender value is acquired after 2 years of all premiums are paid
    • For policies of premium paying term greater than 10 years, the surrender value is acquired after 3 years of all premiums are paid

Eligibility Criteria to Apply for LIC Savings Plans

The eligibility criteria of the LIC policies for investment are:

  1. LIC Jeevan Labh

    Eligibility of LIC Jeevan Labh is:

    • Minimum Entry Age - 8 years
    • Maximum Entry Age - 
    • 59 years of age for a policy term of 16 years
    • 54 years of age for a policy term of 21 years
    • 50 years of age for a policy term of 25 years
    • Minimum Maturity Age - No minimum maturity age given
    • Maximum Maturity Age - 75 years of age
    • Policy term - 16, 21 and 25 years
    • Premium Payment Term - 10 years, 15 years or 16 years
    • Minimum Basic Sum Assured - Rs 2 Lakh
  2. LIC New Jeevan Anand

    Eligibility of LIC New Jeevan Anand is:

    • Minimum Entry Age - 18 years
    • Maximum Entry Age - 50 years
    • Maximum Maturity Age - 75 years
    • Minimum Policy Term - 15 years
    • Maximum Policy Term - 35 years
    • Premium Payment Term - equal to the chosen policy
    • Minimum Basic Sum Assured - Rs 10 Lakh
  3. LIC Jeevan Rakshak

    Eligibility of LIC Jeevan Rakshak is:

    • Minimum Entry Age - 8 years
    • Maximum Entry Age - 55 years
    • Maximum Maturity Age - 70 years
    • Policy term - 10 years or 20 years
    • Premium Payment Term - 10 or 20 years
    • Minimum Sum Assured - Rs 75,000
    • Maximum Sum Assured - Rs 2 Lakh
  4. LIC Jeevan Lakshya

    Eligibility of LIC Jeevan Lakshya is:

    • Minimum Entry Age - 18 years
    • Maximum Entry Age - 50 years
    • Maximum Maturity Age - 65 years
    • Policy term - 13 to 25 years
    • Premium Payment Term - 3 years less than the policy term so if the policy term is 13 years premium paying term is 10 years
    • Minimum Sum Assured - Rs 1 Lakh
  5. LIC Jeevan Pragati

    Eligibility of LIC Jeevan Pragati is:

    • Minimum Entry Age - 12 years
    • Maximum Entry Age - 45 years
    • Maximum Maturity Age - 65 years
    • Minimum Policy term - 12 years
    • Maximum Policy Term - 20 years
    • Minimum Sum Assured - Rs 1.5 Lakh
    • Rebates: For sum assured:
    • From Rs 1.5 to 2.9 Lakh, there is no rebate
    • From Rs 3 to 4.9 Lakh, there is a rebate of 1.5% of the basic sum assured
    • From Rs 5 to 9.9 Lakh, there is a rebate of 2% of the basic sum assured
    • For above Rs 10 Lakh, there is a rebate of 2.2% of the basic sum assured
  6. LIC Bima Diamond

    Eligibility Criteria of LIC Bima Diamond are:

    • Minimum Entry Age - 14 years
    • Maximum Entry Age -
    • 50 years for a 16-year policy term
    • 45 years for a 20-year policy term
    • 41 years for a 24-year policy term
    • Maximum Maturity Age - 
    • 66 years for a 16-year policy term
    • 65 years for a 20- & 24-year policy term
    • Policy term – 16-year, 20 years and 24 year 
    • Premium Payment Term - 
    • 10 years for a 16-year policy term
    • 12 years for a 20-year policy term
    • 15 years for a 24-year policy term
    • Minimum Sum Assured - Rs 1 Lakh
    • Maximum Sum Assured - Rs 5 Lakh
  7. LIC New Bima Bachat

    Eligibility Criteria of LIC New Bima Bachat are as follows:

    • Minimum Entry Age - 15 years
    • Maximum Entry Age - 65 years
    • Maximum Maturity Age - 75 years
    • Policy term - 9 years, 12 years and 15 years
    • Premium Payment Term - One-time premium payment only
    • Minimum Sum Assured - Rs 20,000
  8. LIC Jeevan Tarun 

    Eligibility Criteria of LIC Jeevan Tarun are as follows:

    • Minimum Entry Age - 90 days
    • Maximum Entry Age - 12 years
    • Maturity Age - 25 years
    • Policy term - 25 minus the entry age. For example, if the entry age is 5 years then (25-5) policy term is 20 years
    • Premium Payment Term - 20 minus the entry age. For example, if the entry age is 5 years then (20-5) policy term is 15 years
    • Minimum Sum Assured - Rs 75,000
  9. LIC Single Premium Endowment Plan

    Eligibility Criteria of LIC Single Premium Endowment Plan are:

    • Minimum Entry Age - 90 days
    • Maximum Entry Age - 65 years
    • Minimum Maturity Age - 18 years
    • Maximum Maturity Age - 75 years
    • Policy term - 10 years or 25 years
    • Minimum Sum Assured - Rs 50,000
    • Premium Payment Term - Single Premium policy
    • Rebates:
    • Sum Assured Rs 50,000 to Rs 95,000 – No rebate
    • Sum Assured Rs 1 Lakh to Rs 1.95 Lakh – 18% of sum assured
    • Sum Assured Rs 2 Lakh to Rs 2.95 Lakh – 25% of sum assured
    • Sum Assured Rs 3 Lakh and above – 30% of sum assured
  10. LIC Bhagya Lakshmi Plan

    Eligibility Criteria of LIC Bhagya Lakshmi Plan are as follows:

    • Minimum Entry Age - 18 years
    • Maximum Entry Age - 55 years
    • Maximum Maturity Age - 65 years
    • Policy term - 7 years or 15 years
    • Premium Payment Term - 5 years or 13 years
    • Minimum sum assured is Rs 20,000
    • Maximum sum assured is Rs 50,000

Inclusions, Riders and Exclusions of LIC Savings Plan

  • Riders Available: The optional riders are for accidental death and disability. 
  • Inclusions: A loan option is available in all the policies. It can be availed after the policy acquires a surrender value, which is after 3 years. For single premium paid policy, the loan can be availed after 1 year.
  • Exclusions

A policyholder will not be eligible to file the claims in the following cases:

  • In case the policyholder commits suicide
  • In case the premium is paid for less than one year, no benefit will be paid to the beneficiary
  • In case the premium is paid for more than one year, then the beneficiary gets 80% of the total premium paid

Benefits of LIC Savings Plan

Features and Benefits of Bajaj Allianz Life Insurance are:

  • There is a loan option available after the policy acquires a surrender value
  • The tax benefits can be availed under section 80C and 10(10D) of the Income Tax Act on life insurance policies
  • LIC savings plan gives a grace period of 30 days for paying annual premiums and 15 days for monthly payments
  • There are multiple premium options like single pay premium, limited premium, and regular pay
  • The premiums can be paid quarterly, monthly, annually, or semi-annually
  • The insurance provider provides quick claim settlement support
  • LIC has lower premiums compared to other insurance companies

Documents Required to Apply for LIC Savings Plan

The documents required are:

  • Age Proof: Birth Certificate, School/College Certificate, PAN card, Voter Card, Aadhaar Card, Passport, Driving License and such documents
  • Photo Identity Proof: Voter ID, Aadhar Card, PAN Card, Passport, Driving License, or Public Servant with Photograph
  • Address Proof: Ration Card, Electricity Bill, Bank A/C statement, Telephone Bill, Passport, Utility Bill, Post-paid Bill or Letter from Recognized Public Authority
  • Income Proof: Salary Slip, Form 16, ITR/ Assessment Order/ Employers Certificate
  • Recent passport size photograph

Claim Process of LIC Savings Plan

For maturity claims, the branch office of LIC sends a letter to the policyholder two months before the maturity date of the policy. The policyholder has to send back a discharge form with original policy documents. On the receipt of the document, the policyholder gets a post-dated cheque via the post. In money back policy, documents are not asked; the policyholder gets a cheque on maturity. 

For death claims, the nominee must visit the branch office with the required documents. 

  • Claim Processing: After the submission of necessary documents by the nominee, the insurance provider will verify the documents. Once the verification is complete and after checking for any unpaid premiums, LIC notifies the policyholder
  • Settlement of Claim: According to regulation 8 of IRDAI Regulations, 2002, LIC will settle all claims with 30 days of the receipt of all necessary documents

How to Renew LIC Policy?

For saving plan renewal, the policyholders must pay due to premiums online through LIC's website:

Step 1: Select the 'Premium Payment' option for making a payment.

Step 2: A pop-up will appear to click on 'proceed.'

Step 3: Fill up details such as policy numbers. The amount, including extra charges such as penalty charges, will appear on the screen. Pay the amount, and policy is renewed.

How to Buy LIC Savings Plans Online?

The LIC policy can be bought online as well as offline. 

For online process:

  • Visit the website of LIC
  • Choose the policy
  • Calculate the premium using an online premium calculator
  • Click 'buy policy'
  • Upload the necessary documents
  • Once the form is filled up, LIC will notify the customer about policy details

The LIC policy can be bought offline by visiting the nearest branch.

FAQ's

Written By: Paisawiki - Updated: 19 March 2021