LIC Launches New Endowment Plan (Table No 814). As per the IRDA, LIC revised all the popular plans accordingly to the new rule.
Maturity Benefit – Basic Sum Assured along with Vested Simple Reversionary Bonuses and Final Additional Bonus, if Any.
Death Benefit – ‘Sum Assured on Death’ along with Vested Simple Reversionary Bonuses and Final Additional Bonus, if any.
The death benefit as defined above shall not be less than 105% of total premiums* paid as on the date of death.
What is Sum Assured on Death?
Sum Assured on Death shall be Higher of ~ Basic Sum Assured (BSA)
OR 10 times Annualised Premium.(10 x AP).
[*The premiums mentioned in death benefit are excluding taxes, extra premiums and premiums for riders, if any]
Eligibility Conditions and Restrictions
- Age at entry – 8 to 55 years
- Age at Maturity – Maximum 75 Years
- Policy Term – 12 to 35 years
- Premium mode – Yearly, Half-yearly, Quarterly, Monthly (SSS or ECS)
- Basic Sum Assured – 100000 and above
Loan – Available after payment of 3 full years premiums.
The maximum amount of loan that can be granted as a percentage of Surrender Value shall depend on the Policy Term.
Foreclosure action shall not be taken under fully paid-up and inforce policies even if there is default of loan interest.
Guaranteed Surrender Value (GSV) – Available after payment of 3 full years premiums.
GSV shall be a percentage of total premiums paid (net of taxes) excluding extra premium, if any and premium paid for riders,if opted for.
Examples of GSV factors applicable for total premiums paid
Policy Year ~ GSV factor
3 = 30%
5 = 50%
t -1 = 80% (t=Policy Term)
GSV factor applicable to vested bonus,if any. Examples of Vested bonus factors –
Surrender Value shall be the discounted value of the Paid-up Sum Assured and vested simple reversionary bonuses.
Year of SV – Policy Term – Factor
3 12 18.60%
19 25 20.85%
29 30 30%
( In multiples of 5000)
Special Surrender Value (SSV) – The discount factors shall be surrender value factors as provided in Table-1A of the Special Surrender Value Booklet and will depend upon the policy term and duration elapsed since the commencement of the policy.
Surrender Value payable – The Higher of Guaranteed Surrender Value and Special Surrender Value shall be payable.
LIC’s New Endowment Plan – Changes over Table No.14
- Sum Assured on Death’ has been defined separately
- Age at entry has been reduced.
- Percentage of Loan payable as a percentage of Surrender Value shall depend upon policy term.
- GSV percentage shall also depend on policy term and year of Surrender
- Rebates for high SA and premium mode modified.