LIC Jeevan Lakshya Plan

Jeevan Lakshya Plan by LIC is a limited premium paying conventional plan. It is a non-linked plan, classified as a With-Profits Endowment Assurance plan. It was introduced in March 2015. Jeevan Lakshya provides an annual income to the policyholder as long as he/she lives and a death benefit if the policyholder expires before the maturity of the plan. Moreover, a lump sum amount is received by the policyholder or the nominee at the end of the maturity period.

Key Features and Highlights

LIC Jeevan Lakshya plan has the following salient features:

• Sum assured is Rs. 1 lakh minimum; there is no maximum limit

• The basic sum assured is usually in multiples of Rs. 10,000

• The policy term is 13 to 25 years

• Flexibility in Premium payment modes. Customers can pay the premiums on a yearly, half-yearly, quarterly or monthly basis and choose to pay by cash, card or even use the ECS facility.

• The premium paying term of Jeevan Lakshya policy is 3 years less than the total policy term.

• Age of entry is 18 to 50 years. The maximum maturity age is 60 years.

• It is a With-Profits Endowment Assurance plan. Therefore, the policy offers the Simple Reversionary Bonus as well as the Final Additional Bonus, if applicable, paid at maturity

• These optional riders are available - LIC New Term Assurance Rider, LIC Accidental Death and Disability Benefit Rider

Benefits of LIC Jeevan Lakshya

This policy offers the following benefits:

• Maturity Benefit - If all the premiums are paid in full and the policyholder survives to complete the policy term, he/she receives the Maturity Benefit encompassing the Sum Assured on Maturity along with the vested Simple Reversionary Benefits plus the Final Additional Bonus (if any).

• Death Benefit - If the policyholder expires within the policy term, a death benefit is received by the nominee which comprises the Sum Assured on Death along with the Simple Reversionary Bonus and the Final Additional Bonus, if any.

• Tax Benefits - The premiums paid for this plan is applicable for a rebate on income tax under section 80C. Moreover, the maturity amount is also free from tax as per section 10D

Exclusions

The Jeevan Lakshya policy by the LIC of India has very lucid rules and regulations. The only exclusion is the suicide clause. If the policyholder (life assured) commits suicide within a year from the date of the commencement of the policy, 80% of the single premium paid and extra premium (if applicable) is returned.

Additional Information

• Paid-up Value: If the policy premiums are paid for at least 3 consecutive years and then the subsequent premiums are not paid, the policy acquires Paid-Up Value.

• LIC Jeevan Lakshya Surrender Value: Guaranteed Surrender Value is available if the policy is surrendered after minimum three years of paying the premiums. It is a certain portion of the total premiums paid till date.

• Revival of Policy: Lapsed policies can be reinstated if it has been less than two consecutive years since the last unpaid premium.

• Loan on Policy: After paying the premium for three years, a loan can be taken on the policy.

A Sample Case Study

Let's say that Mr. Rahul has purchased an LIC Jeevan Lakshya policy for a term of 30 years. He is 25 years old and the sum assured is Rs. 20 lakhs. Here are the initial details of the policy:

• Mr. Rahul’s age - 25 years

• Sum Assured - Rs. 20 lakhs

• Policy Term - 30 years

• Premium Payment Term - 27 years

Death Benefit - If Mr. Rahul dies after 10 years from the date of commencement, the death benefit will be:

• The nominee receives Rs. 2,00,000 (10% of the Basic Sum Assured) on each policy anniversary (11th year onwards) until the end of the term (30 years)

• The nominee receives Rs. 22,00,000 (which is 110% of the Basic Sum Assured) plus Simple Reversionary Bonuses plus Final Additional Bonus (if applicable) at the end of the policy term or maturity period

Maturity Benefit - If Mr. Rahul survives till the maturity, the final amount that he receives is:

• Maturity Amount = Sum assured of Rs. 20,00,000 plus Simple Reversionary Bonuses plus Final Additional Bonus (if applicable)

LIC Jeevan Lakshya policy is available to all Indian citizens. It can be purchased through registered LIC offices and agents or brokers. These documents are required for purchasing an LIC policy:

• Application form or Proposal form 300

• Passport size photographs

• Identity Proof

• Address Proof

• Age Proof

• Medical reports (if required)

Although this policy isn’t a lucrative investment option, it is an excellent option for insurance.

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