Tag: LIC POLICY

Surrender of LIC Insurance policy

Posted on by avinash

 LIC POLICY Surrender

If you don’t want to continue LIC policy for any reason then LIC gives you an option to surrender your Policy. There are Lock in period for 3 years in Endowment Plan and 5 years for ULIP plan. LIC policy is not allowed in LOCK in period. It does not matter of policy term but it is clear that delay in surrender gives you better amount. Normally LIC agents in Mumbai are doing all this procedure for surrender of LIC policies.

Where can you surrender your LIC policy

ü LIC parent Branch: Where you have taken your policy, you may go there and do all procedure.

ü LIC Customer Zone: LIC has opened several Customer Zone to help its customer.Here one can get any service related to LIC policies irespestive of parent branch. It is compulsory that Customer has to visit by own along with ID card.You can find Customer Zone in your locality with the help of internet.

ü LIC agent: Just do a call to LIC agent,he will do all documentation of behalf of you.

Documents Require To surrender LIC Policy

Ø Original Policy Paper (Bond Paper)

Ø  Surrender Form (No.5074)Surrender Value(Form No.5704)

Here and take the printout

Ø Your Bank cancelled cheque (your name should be printed on cheque)

If Your Name is not printed on cheque or you don’t have Cheque Book then

 Submit bank passbook photocopy.

Ø NEFT form :Fill all bank details , so that amount will go directly to you.

Ø Aaadhar Card and PAN card self attested zerox copy

Ø One questionnaire form also should be fill in LIC office.

How to Calculate Surrender Amount?

The exact value will be conveyed to you through servicing branch or you can also collect it through SMS/LIC customer care.but  you can also calculate it by own.

{(Total Premium Paid in years/total premium Payable years)X Sum Assured } + Accrued Bonus } X Surrender Factor

 Suppose Mr A has take a policy of rs 30 Lac for 30 years  terms. Now Having paid for 10 years , Mr A wants to surrender it.

{(10/30) X 30 lac} + Bonus } LIC surrender Factor}

 

Note:Once you submit the all necessary documents, then wait for 5-10 days they transfer the fund to your bank account.

 

If you plan to surrender your endowment policy, bear in mind all the money you have paid that you may never get back.

What is Riders in LIC Policies

Posted on by avinash

 

Insurance rider is a kind of add-on benefits to the primary policy, which offers extra benefits with a bit extra premium over the policy subject to certain condition.On such way to maximize the policy benefits on your LIC policy and You may customize it to suit your specific needs is by opting for rider. 

So Rider is for extra benefits with extra cost. But extra premium will not affect Maturity.
Suppose i took DAB (double accidental benefit ) rider alongwith my LIC policy, If i die due to accident then my family will get double of sum assured.

Types of RIDERS in LIC

1.PWB (Premium waiver benefit)

2.A.B(Accidental Benefits)

3.A.D& D.B (Accidental Benefits and Disability benefits)

4. T.R.(Term rider)

5. C.I.R (Critical illness Rider)

1.PWB (Premium waiver benefit)

PLANS available for PWB: 832, 834 & 848.

  • If father/mother take policies for child they can take pwb rider, in this rider if proposer dies then next premium will be waived.
  • It can be included at time of INCEPTION or LATER (atleast min 5 years ppt/term must be left before Date Of Maturity (DOM)
  • The death of the proposer must be before the completion of 18 yrs of age.
  • All the future premiums will be waived till Prem Paying Term/Policy Term.

2) A.B(Accident Death Benefit)

  • Plans numbers available for this Riders are 827, 835, 843, 844 (845, 847, 848).
  • It covers Accidental death before the DOM or 70 yrs of age.
  • For plans in the bracket till ppt only.

3. A.D.& D.B(Accidental Death & Disability Benefit)

Plans available for this Riders are 814, 815, 820, 821, 830, 833, 836, 838, 845, 846, 847 & 848.

  • AD & DB covers both Accidental death and disability due to Accident.
  • Disability means due to any of the 4 out of 6 activities couldn’t be performed mention below.

1) Dressing
2) Feeding
3) Washing
4) Toileting
5) Mobility
6) Transfering

Benefits of Disability riders

1) Waiver of future premiums
2) AB sum assured divided by 120 and payable mly for 10 yrs
3) SB if any payable
4) Maturity benefits payable.
If Death occurs before Maturity Death Claim also payable.

4) T.R(Term Rider) benefits

Plans available for this Riders are: 814, 815, 820, 821, 830, 833, 836, 845, 847 & 848..

  • An Additional S. A is payable on Death of the P.H before maturity by any way.

5) C.I.R(Critical Illness Rider)

  • Plans available for this Riders are: 814, 815, 820, 821, 830, 836, 838, 845, 847 & 848.
  • On the 1st diagnosis of any of the 15 diseases mentioned in the circular dt 19.12.2016 N.B Dept. The CIR S.A is payable to the PH ON survival after 30 days of the Diagnosis.
  • Min. 1 lakh
  • Max. S.A. Overall limit 25 lakhs per person.

(If we take Cancer Cover plan this benefit is upto 50 lacs.)

 

LIC term insurance is costlier than others

Posted on by avinash

Insurance Premium of term insurance plan of LIC is very costly than other insurer in India. What would be the reason?If 30yrs old person gets term insurance than Yearly premium would be rs 19000 for 1cr sum assured policy even though private insurer charge approx 10 to 11k only.
Few reasons to ponder prior to take LIC term insurance:

LIC CLAIM RATIO: LIC CLAIM statement is the highest in the world Its 98.3% as per IRDA data. We all know LIC has huge customers but maintaining greatest CLAIM RATIO .

Government’s backing: LIC is paying huge dividends to government from its Yearly profit . On the contrary Government provides sovereign Guarantee on each policies . Which is not available in PRIVATE INSURER.

Mortality Rate: it is basic ingredient to calculate premium of any policies . But we know that mortality Rate is common for all insurer. Private company must not reduce it. Even though longevity of every citizen has been increased and on an average people living 72 years normally.Which is common for all insurance company

Admin Charge: LIC has the lowest administration charge amongst almost all insurers. Salary of LIC staff,Offices and all other expenditure is very less in LIC.It is visible to all.

Note: The only reason for high premium of its Guaranteed CLAIM payments. One can take online term insurance from LIC with reduced premium.

National Automated Clearing House (NACH) for LIC Policy

Posted on by avinash
If you are taking a LIC policy in monthly mode then you have to submit NACH form along with LIC proposal. NACH is a replacement of ECS (electric clearance service) form. As you must know ECS was giving authority to your bank for monthly deduction from your account, same thing NACH will do .

But one basic difference is that you have to pay two month’s premium to start the policy ,whereas, through ECS only one month premium was needed to log in your policy in LIC .

One benefit is there ,Now you don’t need to go to concern BANK to get stamp on this NACH ,like it was in practice in ECS form.
 
Difference between ECS and NACH 

NACH

  1. Administered by NPCI
  2. Bank if LIVE on NPCI all its branches participate in NACH
  3. Creation of NACH master on the basis of creating branch
  4. Customer need not visit Bank-Branch for validation of mandate form
  5. Cheque leaf type mandate form
  6. NACH processing starts only when mandate is validated and accepted by destination bank
  7. Only CBS account number allowed ( 9 digit or more )

ECS

  1. Administered by RBI
  2. Participation of Bank branch if authorised by RBI
  3. Creation of ECS master on the basis of MICR
  4. Customer needs to visit Bank-Branch for validation of mandate form
  5. A4 type ECS mandate form
  6. ECS processing starts immediately on registration
  7. No restriction on account number
  8. Under ECS-Mly, one premium at NB stage

JEEVAN LAKSHYA PLAN 833

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Its a complete Financial protection

  1. For Child Future Provision
  1. (Kanyadan,Marriage,Education)
  1. Own Particular dream)

It is a combination of Saving and risk cover both.

Eligibility:

  • Min & Max Age at entry   18 to 50 years lbd (Last BirthDay) 
  • Age at maturity : 65 years.
  • Policy Term  : 13 to 25 years.
  • PPT (Policy Term – 3) years
  • Premium Mode Yly, Hly, Qly , SSS and ECS.
  • Mini Sum assured 100,000. No upper Limit.
  • Riders DAB available upto 1 cror and Term rider

Age proof Only Standard age proof and NSAP I & II acceptable.**

  • Mode Rebate
  •  Yly: 2% of TP,
  • Hly: 1% of TP, 
  • Qtly & monthly : NIL
  • Date Backing  Allowed 
  • Surrender & loan  Allowed after 3 yrs. 
  • Female  All categories allowed as per LIC rules

Non Medical  allowed as per present rules.
NRI   Allowed for Both NRI and FNIO in V,VI & VIII   countries. 

Maturity :

SA+Bonus+FAB will be paid

Example     

Now see risk cover from this Plan with example

Now see risk cover from this Plan with example

Jeevan lakshya plan 833 returns if Policy Holders dies

  1. Immediate 110% of Sum Assured

  2. 10% of Sum Assured till policy end

  3. Maturity Benefit also goes to family

  4. Premium will stop

  5. Tax Benefit

Suppose if Policy holder dies at 10 year after taking this policy,

Till 10th year He/She  paid premium =4.5 Lac (45000 yearly X 10 years)

  • Immediate 11 lac (+ 10 lac if accidental death )

  • 1 lac every yearly till 14th year = 14 lac

  • Maturity 26.75 lac

Total 51.75 Lac tax free amount goes to family

Note : This is much suitable for young age group . even though it is not a child Plan but one may have for child Education and Daughter”s  marriage.

This Plan is also called  “KANYA DAN” policy .