LIC: Jeevan Labh Policy

Introduction:

When we talk about the most effective Life Insurance Plans, Jeevan Labh stands on the top of the priority list. LIC Jeevan Labh Policy is proposed by the Life Insurance Corporation (LIC) of India. It is not only a reasonable with-profits funding but also a non-linked, and limited premium paying plan.

It proposes a combination of protection and savings. This suggests that your money will remain protected and you will receive the amount as promised. Eligible candidates come under the age group of 8-59 years.

The most important concern that may pop up in your mind is WHY YOU NEED THIS POLICY? Because it strengthens your financial security and gives you additional economic support.

Essentially, this plan comes with so many bright sides. You have to pay for a limited time and by the end of your policy, you will receive the maturity benefits. Additionally, this plan offers supplementary financial support in case of your sudden demise before the maturity. Your nominee can fetch the death benefit (sum assured with a bonus if any) in case of any mishappening. Apart from the death benefit, maturity benefits and riders’ benefits also exist parallelly.

Major elements of Jeevan Labh:

Below are the key features of Jeevan Labh, you must get acquainted with them before proceeding further:

Policy type: Traditional Endowment Plan

Policy basis: Individual

Policy scope: Maturity benefit, Death benefit, Rider benefits.

Policy period: 16 years (10 years Premium Paying Term or PPT)
21 years (15 years Premium Paying Term or PPT)
25 years (16 years Premium Paying Term or PPT)

Loan: You can avail for loans if and only if you have already paid all the premium for the first 3 years completely and the plan has amassed a surrender value.

Free-look Period: You can step back if you want to terminate the policy within the next 15 days after the commencement of the policy.

Basic sum secured: Minimum 2 lakhs and Maximum value is not restricted.

Premium payment regularity: Either annually, half-yearly, quarterly, or monthly and Salary Savings Scheme (SSS) mode.

Revival: You can revive the policy any time within the next 2 years. You have to pay all the unpaid premiums along with interest and remaining charges.

How does LIC Jeevan Labh Policy work?

Sum assured and policy terms are the two main standards that you have to decide before investing in the LIC Jeevan Labh plan. The minimum age threshold for applying is 8 years. The ultimate maturity age is 75 years.

Sum assured is the amount you have to pay. Coverage or the sum assured will initiate from a minimum of 2 lakhs to up to any amount, as there is no upper limit. If 3 years full premium has been paid, then you can avail the loan.

Policy terms refer to the period up to which you want to extend the policy. If you opt for a 16 years policy term, you have to settle with a 10 years premium paying term (PPT). That means you have to pay for the initial 10 years. You will get relaxation for the last 6 years.

Likewise, If you choose a 21 years policy term, you have to go for a 15 years premium paying term. If you prefer 25 years of the policy term, then you have to pay premiums for 16 years.

The premium will take a final shape depending on the sum assured, policy term, and the age at which you are opting for the policy.

According to a participating plan, you will be eligible for a simple reversionary bonus and final addition bonus at various points of the policy period.

Eligibility benchmarks for Jeevan Labh Policy:

Eligibility benchmarks for Jeevan Labh are rehearsed as follows:

Sum secured: Minimum 2 lakhs and Maximum value is not restricted.

Policy period (in years): 16, 21, and 25 years.

Age of access: Minimum eligible age is 8 years
Maximum eligible age categories include- 50 years (25 years PPT), 54 years (21 years PPT), 59 years (16 years PPT).

Utmost maturity age: 75 years

Premium policy terms: 10, 15, and 16 years for 16, 21, and 25 years of policy terms respectively.

Premium paying regularity: Either annually, half-yearly, quarterly, or monthly.

Benefits of LIC Jeevan Labh Policy:

The name itself is exemplifying that you will get ample of benefits from the LIC Jeevan Labh Policy.

The death benefit or Sum assured on death: The death benefit refers to the amount paid to you in case you expire unexpectedly during the tenure of the policy. Your nominee will get a handsome sum assured on death, vested simple reversionary bonus (which has been declared till date) with the final additional bonus (if declared in that year). All the above, the nominee will not get less than 105% of all premiums paid.

Maturity benefit or Sum assured on maturity: If you survive the full policy tenure and all the premiums are correctly paid by you, then you will receive a sum assured on maturity, the vested simple reversionary bonus supplementarily a final additional bonus (if any).

Profit participation: Until the policy is in full force, you will continue to receive simple reversionary bonuses. You or your nominee will also receive a final additional bonus (if declared in that year) by the end of the claim is made either by maturity or death.

Income tax benefit: This policy offers several tax benefits. Under section 80C and 10 (10D) of the Income Tax Act, a premium insurer can opt for the tax benefits as well as his maturity amount is tax-free when his premium payment exceeds 1.5 lakhs in a financial year.

Life cover or Death Claim: In case of your unexpected demise, your nominee will receive the basic sum assured, vested simple reversionary bonus with the final additional bonus, provided all the premiums have been paid when the policy is in action.

Rebate: In the form of rebates, LIC serves various perks to the insurers. Generally, it is based on a premium paying mode. (Only on Half and yearly premiums)

(Mode and High S.A. Rebates:

Mode Rebate:
Yearly mode – 2% of Tabular Premium
Half-yearly mode – 1% of Tabular premium
Quarterly & Salary deduction – NIL

High Sum Assured Rebate:
Basic Sum Assured – Rebate (Rs.)
1,00,000 to 1,90,000 – Nil
2,00,000 to 4,90,000 – 2%o Basic Sum Assured
5,00,000 to and above – 3%o Basic Sum Assured)

Loans: If you pay all the premium on a periodic basis until the first 3 years of the policy, you can take a loan. The maximum loans that you can avail are 80% of the surrender value for paid-up and 90% of the surrender policy for in-force policy respectively.

Ideal Plan: Ideally, this plan is great for you if you are planning for your child’s marriage or education or expecting additional financial security.

Riders benefits proposed by LIC Jeevan Labh Policy:

If anyone wants to expand the coverage of the existing policy, then he can avail Rider benefits. Rider benefits include 5 optional riders.

Accidental death or disability: In case of your accidental death or if you met with a severe accident, then according to this insurance, a specified amount of sum will be paid to you and your nominee (to your nominee if you is no more) along with the death benefit.

Accidental benefit rider: When you expire accidentally, then the accidental death benefit (sum assured) will be paid to your nominee or beneficiaries within the next 6 months (180 days) from the date of the accident.

Critical illness rider: If you purchase this rider benefits during the commencement of the policy and later on if you are diagnosed with any of the 15 critical illnesses (Link) (mentioned in this rider), then you can avail of the benefits under this rider.

Term assurance rider: If you apply for this at the beginning of the policy, then an additional sum along with the basic death benefit will be given to your beneficiaries on your sudden demise.

Premium waiver benefit: This rider benefit is a compilation of all the rider benefits altogether. If under unexpected circumstances anything happens to you, then a sum of money will be given to you or your nominee (in case you expire). It will become a paid-up policy if you fail to pay the policy premiums thereafter.

Sample premium illustration of LIC Jeevan Labh Policy:

Here, it is an illustration of the annual premium rate of 2 lakh basic sum assured is demonstrated.

Keywords you must know:

Grace period: If you fail to pay the premium, then you will get a concession for a few days. In case you miss the due date, you will get a grace period of 30 days in case of quarterly, half-yearly, and yearly premium policy and 15 days for monthly premium policy.

Free-look period: You can step back if you want to terminate the policy within the next 15 days after the commencement of the policy.

Paid-up value: When you fail to pay premiums after a certain period of time, then paid-up value is lessened. If you pay all the premiums for the first 3 years and continues to do so, then the paid-up value expands.

Policy surrender: You can step back or terminate the policy at any point in time. Policy surrender is the sum assured to you when you will withdraw yourself from the policy.

Final thoughts on LIC Jeevan Labh Policy:

LIC Jeevan Labh Policy will assure you a combination of protection and savings. It will protect your money and provide you the amount as promised. This policy also comes along with other financial support. If you are looking for long term financial support, then Jeevan Labh Policy is perfect for you.