LICI JEEVAN UMANG PLAN. (TABLE NO 845)
Full features of JEEVAN UMANG:
Summary of LIC Jeevan Umang Plan - Table No. 845:
LIC Jeevan Umang is an endowment cum whole life plan which offers a regular payout from the end of the premium payment term till the date of your survival. This plan is a participating plan eligible for Simple Reversionary Bonus and Final Addition Bonus.
key features:
This is an endowment cum whole life policy
Offers 8% of Sum Assured after the premium payment term - till you are alive or till the age of 100
The plan offers Simple Reversionary Bonus & Final Addition Bonus
Tax Benefits on Premiums, Death Benefit & Maturity Benefits
Death Benefit:
If the policyholder dies before the “Risk Commencement Date” - All the premiums paid will be returned to the nominee.
If the policyholder dies after the “Risk Commencement Date” - The nominee will get the Sum Assured on Death.
Sum Assured on Death is the highest of the following:
10 times the Annualised Premium
Basic Sum Assured + Simple Reversionary Bonus + Final Addition Bonus
The Death Benefit will never be less than 105% of all premiums paid.
The premiums referred in the Death Benefit do not include taxes, Rider premiums and any increased premium on account of underwriting decisions.
Survival Benefit:
On completion of a year after the premium payment term, the policyholder will start getting 8% of the Basic Sum Assured every year. This amount is payable every year till he reaches the age of 100 or he dies, whichever is earlier.
Maturity Benefit:
On reaching 100 years of age, the policyholder will get the Sum Assured + Simple Reversionary Bonus + Final Addition Bonus.
Loan Facility:
You will be eligible to get a loan against this policy once it acquires a Surrender Value. This plan gets a Surrender Value only after 3 full years of premiums have been paid. The loan amount and interest rate would depend on the prevailing at the time of taking the loan.
Lic Jeevan Umang Plan Example:
Let us understand this plan with the help of an example:
Suppose Mr.X who is 35 years old buys this plan with the following parameters.
Sum Assured = Rs. 5,00,000
Policy Term = 100 - Age at entry = 100 - 35 = 65 years
Premium Payment Term = 20 years
Based on this the yearly premium will be Rs. 26,105 + Taxes
Since his age is greater than 8 years at the time of taking the plan, the risk cover will start immediately.
SCENARIO 1: MR.X dies after 7 years of paying the premium.
His nominee will get the Death Benefit which is higher of the following:
1. 10 times the Annualised Premium = Rs. 2,60,105
2.Basic Sum Assured + Simple Reversionary Bonus + Final Addition Bonus = Rs. 5,00,000 + Simple Reversionary Bonus + Final Addition Bonus.
In fact, his nominee will get this same benefit, if MR.X dies anytime before the premium payment term.
SCENARIO 2: MR.X dies after 22 years of taking the plan and has paid all 20 premiums.
Since his premium payment of 20 years is over, he would be eligible for Survival Benefits every year after that as follows:
1. 1 year after he has finished paying the 20th premium = 8% of Sum Assured = 8% of Rs. 5,00,000 = Rs. 40,000
2. 2 years after he has finished paying the 20th premium = 8% of Sum Assured = 8% of Rs. 5,00,000 = Rs. 40,000
His nominee will get the Death Benefit which is higher of the following:
1. 10 times the Annualised Premium = Rs. 2,60,105
2. Basic Sum Assured + Simple Reversionary Bonus + Final Addition Bonus = Rs. 5,00,000 + Simple Reversionary Bonus + Final Addition Bonus
Note: Now for every year that MR.X is alive after the premium paying term, he will get 8% of the Basic Sum Assured. He will get this Rs. 40,000 till he reaches the age of 100 or till his death, whichever is earlier.
Also, if MR.X dies anytime after the premium payment term, his nominee will get the Death Benefit and the policy will terminate.
SENARIO3: If MR.X survives till the age of 100.
He will get the Survival Benefit of Rs. 40,000 every year after the completion of the premium payment term of 20 years.
He is also eligible for the Maturity Benefit also which = Sum Assured + Simple Reversionary Bonus + Final Addition Bonus.
NOTE: MRX also save tax 1) rs 9550 yearly approx ( in 30% categories)
2) rs 6367 yearly approx (in 20% categories)
The revival of the policy:
If premiums are not paid on time, even after the grace period, the policy will lapse. A lapsed policy can be revived within a period of 2 consecutive years from the date of first unpaid premium but before the date of Maturity. You will need to pay all the due premium with interest (compounding half-yearly) at a rate fixed by LIC.
Paid-up Value:
If less than three years’ premiums have been paid and policy has not been revived, all the benefits under the policy shall cease after the expiry of the grace period and nothing shall be payable. If at least three full years’ premiums have been paid and any subsequent premiums are not duly paid, the policy shall not be void but shall continue as a paid-up policy till the end of policy term.
The Sum Assured on Death under a paid-up policy shall be reduced to a sum called “Death Paid-up Sum Assured” and shall be equal to [(Number of premiums paid /Total number of premiums payable) * Sum Assured on Death].
The Sum Assured on Maturity under a paid-up policy shall be reduced to a sum called “Maturity Paid-up Sum Assured” and shall be equal to [(Number of premiums paid /Total number of premiums payable)*(Sum Assured on Maturity)].
Surrendering the Policy:
The policy can be surrendered at any time provided premiums have been paid for at least three consecutive years. On surrender of the policy, LIC shall pay the Surrender Value equal to higher of Guaranteed Surrender Value and Special Surrender Value.
The Special Surrender Value is reviewable and shall be determined by the Insurer from time to time subject to prior approval of IRDAI.
The Guaranteed Surrender Value payable during the policy term shall be equal to the total premiums paid multiplied by the Guaranteed Surrender Value factor applicable to total premiums paid. These Guaranteed Surrender Value factors expressed as percentages will depend on the policy term and policy year in which the policy is surrendered
Free look period:
If the Policyholder is not satisfied with the “Terms and Conditions” of the policy, the policy may be returned to LIC within 15 days from the date of receipt of the policy bond stating the reasons of objections. On receipt of the same LIC shall cancel the policy and return the amount of premium deposited after deducting the proportionate risk premium (for base plan and rider, if any) for the period on the cover and stamp duty charges.
Benefits of LIC JEEVAN UMANG PLAN AT THE AGE OF 30 AND SA 10,00000:
You notice that up to 30 years of a term, he will pay Rs.6,621 as premium. From 31 year, he will receive the survival benefit at the rate of 8% till maturity. Again on maturity, he will be eligible to receive the Sum Assured+Bonus+FAB.
I considered as if the policyholder survive until the age of 70 years. However, if we consider that he dies before attaining the age of 70 years, then the returns will be less than what he invested.
Even though it looks too attractive that you have to pay up to 30 years and from 31st year onward to 70 years 8% GUARANTEED return and again if you survive till maturity, then one more time you receive the benefit.
But you calculate using the IRR function of excel sheet (which is the way to calculate your return on investment), it shows just 5.26% returns.
No comments:
Post a Comment