LIC: Nivesh Plus 849

A question which immediately pops up in your mind is WHY YOU NEED THIS POLICY? One single line can sum the whole thing. Because it intensifies your financial immunity and provides additional monetary security.

Life insurance policy has brought another integrated plan. LIC Nivesh Plus is a single premium, the individual life insurance plan. It is a unit-linked life insurance plan. It offers you a single integrated plan which covers insurance and investment both.

Eligibility benchmarks for LIC Nivesh Plus Policy:

Sometimes, eligibility benchmarks are not as simple as they appear. For your better understanding, they are rehearsed as follows:

Basic sum secured: Here, you will get two options. In the first option, you are served with 1.25 times of single premium and in the other option, it is 10 times of single premium. Once you choose an option, you can’t jump onto another one with the lapse of time.

The single premium plan authorizes you to pay the entire amount all at a once. As you have already witnessed you will get to two options, the first option is not exempted from tax. If you invest 1 lakh supposedly, then you will receive 1.25 lakhs at the termination of your policy and you will be charged 12,500 (10% of sum assured) under Section 80C.

If you choose option 2 (10 times of single premium) then your maturity proceeds will be freed from tax. But here the “sum-at-risk” is very high.

Policy period (in years): The policy period solely depends on your age and sum assured.

In option 1, the minimum policy term is 10 years and the maximum is 25 years. Option 2 comes along with three different limitations. If your entry age is within 25, then the minimum policy term is 10 years and the maximum is 25 years. If the entry age is within 26-30, then the minimum and maximum policy term are 10 and 20 respectively. If within 31-35, then both the policy terms conclude at 10 years only.

Age of access: Minimum is 90 days, Maximum is 70 years (in option 1) and 35 years (in option 2).

Maturity age: Minimum is 18 years, maximum is 85 years (in option 1) and 50 years (in option 3).

Lock-in period: 5 years

Premium: Minimum is 1 lakh and no upper limit is agreed on.

What charges LIC Nivesh Plus Policy make?

LIC Nivesh Policy includes Premium Allocation Charges, Mortality Charges, Fund Management Charges and Discontinuation Charges.

Without further ado, let’s take a deep dive into them-

1. Premium Allocation Charges: An amount of money which gets deducted from your basic sum assured during the initial days of your policy and it includes GST too.

● 5% for online sales (through LIC agents)
● 5% for offline sales (through agents)

2. Mortality Charges: You have to pay this charge at the very beginning of your policy tenure. The value of the mortality charge is equivalent to the difference of basic sum assured and unit fund value which is termed as “sum-at-risk”. Mortality charge keeps on increasing with the flow of time (with age).

3. Fund Management Charges: To manage the funds under this policy, a charge is made separately which is considered as Fund Management Charge.

4. Discontinuation Charges: If you terminate your policy at any point in time, then a charge is applied to your sum assured. The value of it greatly varies depending upon the length of your existing policy.

Keywords you must know:

Death Benefit: It entitles your nominee to summon the death benefits in case you expire before the maturity. One more criterion is added here, your nominee will receive the fund value in case of unexpected your demise before the date of commencement of risk. On death after the risk commencement date, your nominee will summon an increased sum assured.

Payout: Your nominee will receive the death benefits in instalments according to this particular plan structure.

Maturity benefit: It reflects the normal circumstance which declares that you will receive the unit fund value as promised if you survive till the maturity of the policy.

Guaranteed additions: This policy comes along with a few guaranteed additions. Supposedly, you have chosen a plan, so throughout your policy, the guarantee addition is fixed. Every premium offers different guaranteed additions. If your policy extends up to 6 years, guarantee additions will be 3%, for 10 years it’s 4%, for 15 years it’s 5%, for 20 years it’s 6% and for 25 years it’s 7%. For example, if you are paying 1,00,000 in a year then after 6 years, your original amount will be additionally credited with 5,000.

Switches: The plan permits you to swap among 4 different funds during your restricted policy cycle. Your whole fund value will be credited to a new fund whenever you opt for switching.

Partial withdrawal: You can withdraw a fixed or partial amount after your policy coverage exceeds 5 years or else if you are a minor, then the same thing is applicable after 18 years after the commencement of the policy.

Free lock-in period: The first 15 days allow you to withdraw your will from this policy in case you do not want to extend your policy tenure further.

Surrender: If you withdraw your policy before the lock-in period (5 years), you will be credited with that amount which you have paid till now (excluding the unpaid payments). If you surrender after the lock-in period ( 5 years) then you will receive a handsome of money which includes the entire sum assured.

Loan: To be honest, this policy does not allow you to avail for loans.

Optional Rider:

In case of your accidental demise, the rider will compensate for an accidental death benefit sum assured combined with a death benefit. The accidental death benefit sum assured must be less than the sum assured in any way.

Exclusion:

Suicide: In case if you commit suicide within the first 12 months after commencement of the policy, then your nominee will receive a monetary worth of the units owned by you at that point of time. The plan will terminate as soon as your beneficiary receives the unit fund value.

Final thoughts on LIC Nivesh Plus Policy:

As Nivesh Plus is unit-linked insurance so it does not assure you any money-back guarantee. All in one, you already get to know that option 1 is not exempted from tax. In it, life cover is also much lower as compared to option 2. The thought can be summarised like this-

1. Option 1- Sum assured is 1.25 times of single premium. It is not exempted from tax. It provides you with lower life cover.

2. Option 2- Sum assured is 10 times of single premium. It is exempted from tax. It provides you with a higher life cover.

The unit fund value also depends on your age. In both cases, the death benefit is freed from tax. So, it is very reasonable for you to comprehend and go through all the criteria and requirements carefully before you jump into this policy plan.