Life Insurance Corporation of India is one of the most prominent term insurance plans’ providers in India. Undoubtedly, LIC term plans are deemed as the most trustworthy insurance investment as they are low premium amount but adequate insurance cover.
LIC of India Company Overview:
Ever since the LIC had been established in 1956, it has been a huge market share holder in the Indian insurance industry. The corporation provides insurance plans to match every requirement of a policyholder.
LIC is one of the oldest players in the Indian insurance market and has been catering to insurance needs of the entire nation with a wide range of insurance products.
Undoubtedly, the brand has an extensive reach in the market with a variety of LIC term plans that generations of families are using and are satisfied with.
Types of LIC Term Plans:
LIC currently offers three term insurance plans that provide comprehensive life insurance cover. These LIC term plans are designed keeping in mind individual financial needs & obligations and are easily available online as well as offline.
|Plan||Policy Term||Entry Age (Min-Max)||Maturity Age||Sum Assured (Min-Max)|
|LIC Anmol Jeevan II||5 – 25 years||18 – 55 years||65 years||Rs 6 lakhs – Rs 24 lakhs|
|LIC Amulya Jeevan II|
|5-35 years||18-60 years||70 years||Rs 25 lakhs – No Limit|
|LIC e-Term plan||10-35 years||18-60 years||75 years||Rs 25 lakhs (Rs 50 lakhs for non-smokers) – No limit|
LIC Term Insurance Plans in Detail:
- LIC Anmol Jeevan II (Plan Number 822)
LIC Anmol Jeevan II was launched by LIC on 3rd February, 2014 and is a without profit pure protection plan offered by the company. The UIN (Unique Identification Number) for LIC Anmol Jeevan II is 512N285V01.
- LIC Amulya Jeevan II (Plan Number 823)
LIC Anmol Jeevan II was launched by LIC on 3rd February, 2014 and is a without profit pure protection plan offered by the company. The UIN (Unique Identification Number) for LIC Anmol Jeevan II is 512N286V01.
- LIC e-Term plan (Plan Number 825)
LIC e-Term is a regular premium non-participating online term insurance plan offered by the company. This plan has no intermediaries involved and is available through online application process only. The UIN (Unique Identification Number) for LIC e-Term is 512N288V01.
Features of LIC Term Insurance Plans:
- The premium for LIC term insurance plans can be paid regularly during the policy term, either in the yearly or half-yearly mode. In case the policyholder chooses the half-yearly payment mode, there will be an additional 2 percent charged on her/his premium amount.
- In case the death of the policyholder occurs during the policy tenure, her/his nominee will be paid the sum assured in total by the Corporation.
- There won’t be any benefit paid to the life assured, if s/he survives the policy tenure.
- In case the policyholder hasn’t paid the premium for LIC term plans, s/he will get a grace period of one calendar month to do so. However, the calendar month shouldn’t be of less than 30 days.
- If the death of the policyholder occurs within the grace period and the premium is still due, the policy will remain valid and the nominee will receive the policy benefits after deducting the unpaid premium and the due premiums till the next policy year.
- If the policyholder is unable to pay the due premium within the grace period, her/his policy will be lapsed. However, it can be revived within 2 years from the date of last due premium (but before the maturity date of the plan).
- The policyholder needs to provide sufficient documents to withhold her/his eligibility to get the plan revived and should pay the entire due amount to get the policy revived. However, LIC reserves the right to revive a plan on its own discretion.
- The plan and its benefits will stand void if the policyholder commits suicide within 1 year (12 months) from the date of policy inception. However, the nominees will be given a return of 80% of the premium paid, provided premiums are paid till the death of the life assured.
- There will be no maturity payout, if the policyholder survives the term of the insurance.
- Any claim and the premiums paid under LIC term plans are exempted from the tax u/s 80(C) and 10(10D). Tax deduction can be availed to an amount of Rs1.5 lakhs on the premium paid towards the LIC term policy and completely on the death claim under the sections 80C and 10(10 D), respectively.
- The premium rates for LIC term policy can be offered in two different categories, namely for non- smokers and smokers, the former obviously enjoying a lower premium rate. This pricing structure is only applied if the coverage amount is equal to or greater than INR 50 Lakhs.
Benefits of Buying LIC Term Plans:
- With LIC term plans, you get higher coverage at much affordable premium rates. If you are not into smoking habits, this again saves you some extra money on your premium rate.
- With LIC term insurance plans, thee policyholder gets flexible mode of payments. One can also avail the benefit of flexibility in the premium payment frequency.
- The policyholders also get different sum assured options and add-on coverage/riders to choose from.
- LIC term plans give the policyholders an option to convert one plan to another (although, it is not available for all plans).
LIC Term Insurance Plan Exclusions
As every other insurance provider, LIC term plans also have a list of exclusions under which the company is not liable for claim settlement:
- One of the major exclusions on all LIC term plans is in case of suicidal death of the policyholder during the policy tenure. The Corporation is not able to pay any death benefit in such cases.
In case the policyholder commits suicide within the first 1 year (12 months) from the policy inception date or the policy revival date, there will be no payout.
The nominee will receive 80% of the premium amount paid till the date of death of the life assured, subject to the condition that the premiums have been paid in full till that date.
Riders Offered with LIC Term Plans
LIC term insurance plans offer two special featured packed riders that will help you get additional benefits at nominal cost.
The two riders offered by LIC term plans are:
New Term Assurance Rider
LIC’s New Term Assurance Rider offers life cover to the policyholder in case of her/his unfortunate death during the policy term. It can be added with the base plan to provide add-on benefit at a nominal cost. Please note down that this rider can only be attached with non-linked plans at the time of buying the base policy.
|Entry Age||Minimum – 18 years; Maximum – 60 years|
|Maturity Age||Maximum – 75 years|
|Premium Payment Mode||Same as base policy|
|Premium Payment Frequency||Same as base policy|
|Policy Term||Same as base policy|
|Sum assured||Minimum – Rs. 1 lakh; Maximum: Rs 25 lakhs|
Benefits of New Term Assurance Rider:
a) Death Benefit:
Under this benefit, an amount equal to the sum assured provided in the rider is paid to the nominee in case of unfortunate death of the policyholder during the policy tenure.
b) Maturity Benefit:
Nothing is paid under this rider in case of the survival of the policyholder till the end of the term of the rider.
Critical Illness Benefit Rider
LIC New Critical Illness Benefit Rider is a non-linked ad-on rider that can be attached with the base policy at the time of buying the policy. It helps the policyholders by taking care of their financial burden in case the policyholder is diagnosed with any of the pre-specified critical illnesses.
The Critical Illness Benefit Rider under LIC term insurance plans cover 15 Critical Illnesses, including Open Chest CABG, Cancer of specific severity, Stroke, Kidney Failure that requires regular dialysis, Blindness, Permanent paralysis of limbs, Alzheimer’s, Third degree burns, etc.
|Entry Age||Minimum – 18 years; Maximum – 65 years|
|Maturity Age||Maximum – 75 years|
|Premium Payment Mode||Limited Pay, Regular Pay|
|Premium Payment Frequency||Same as base policy|
|Premium Payment Term||Regular Premium Policies: 5-35 years depending on the policy term|
Limited Pay: 5 years to (Policy term– 1 year) years
|Policy Term||Regular Premium Policies: 5-35 years depending on the policy term|
Limited Pay: 10 – 35 years
|Sum Assured||Minimum – Rs. 1 lakh; Maximum: Rs 25 lakhs|
The Benefit of Critical Illness Benefit Rider:
Under the critical illness rider, the policyholder will be given the critical illness sum assured on the first diagnosis of any one of the 15 Critical Illnesses as mentioned in the rider document. The Critical Illness Rider is paid only once during the policy term while the policy is still active. The rider and its benefits will be ceased once the Critical Illness Sum Assured is paid.
Exclusions under LIC Critical Illness Benefit Rider:
The Company will not be liable to pay any of the benefit, if the critical illness has occurred as a result of any of the below enlisted conditions or reasons:
- If the death of the policyholder occurs within 30 days from the diagnosis date due to any of the listed critical illness.
- Any critical illness covered under the rider manifesting itself within 90 days of the inception of the risk or revival of risk cover.
- Intentional suicide or self-inflicted injury, regardless of the mental condition of the policyholder.
- Alcohol abuse or indulging in drugs except under the direction of a registered medical practitioner.
- War, hostilities, invasion, civil war, revolution, rebellion or taking part in civil commotions or riots.
- Taking part in any criminal act
- HIV or AIDS
- Nuclear accidents leading to radioactive contamination.
Claim Process for LIC Term plans:
LIC is known to for its customer-oriented services and the claim settlement ratio proves its outstanding services. The company was able to achieve a claim settlement ratio of 98% in the FY 2015-16, which shows its focus on the betterment of services for its customers.
Below enlisted are different claim procedures for LIC term insurance:
1. Death Claims:
The death claim amount is paid if the policyholder has paid her/his policies in full and her/his premium payment status is up-to-date. Once the LIC branch office receives the receipt of intimation of death of the policyholder, it calls-in for the following requirements:
a) Claim form A – It include the claimant’s statement giving details of the claimant and the deceased policyholder.
b) Certified document from Death Register
c) Original Policy Document
d) Documented age proof, if age is not admitted
e) Evidence of the deceased’s estate title if the policy is not assigned, nominated or issued under M.W.P. Act.
The Corporation can also ask for additional forms if death has occurred within 3 years from the date of risk or from revival or reinstatement date.
a) Claim Form B – Certificate of a medical attendant completed by the medical attendant who was looking into the case of deceased policyholder during her/his last illness
b) Claim Form B1 – if the policyholder has received a hospital treatment
c) Claim form B2 – to be filled-in by the Medical Attendant who was treating the deceased policyholder prior to his last illness.
d) Claim Form C – an identity and cremation or burial certificate to be filled-in and signed by a person of designated authority and responsibility.
e) Claim form E – employer certificate (if the policyholder was employed).
f) Certified copies of FIR (First Information Report), Police Investigation Report and the Post-mortem report in case the death occurred due to any unnatural case such as accident.
These additional forms are needed to satisfy the Corporation about the claim’s genuineness. This is to ensure that no material information that could affect the proposal acceptance has been withheld by the claimant at the proposal time. Furthermore, these forms also help the company at the time of investigation to verify the details.
2. Claim Concessions during the Lapsed Period:
If the life assured has paid her/his premiums for a minimum of 3 years and then have discontinued paying the premiums, and her/his death occurs within 6 months from the first unpaid premium’s due date, her/his nominee will receive the full policy money after the unpaid premiums’ deduction along with the interest up to death date of life assured.
If the life assured has paid her/his premiums for a minimum of 5 years and then have discontinued paying premiums and her/his death occurs within 12 months from the first unpaid premium’s due date, her/his nominee will receive the full policy money after deducting the outstanding amount for unpaid premiums along with the interest up to death date of the life assured.
3. Double Accident Benefit Claims:
Double Accident Benefit is offered as an additional support with the base policy cover. An extra premium of Rs.1 per Rs.1000 of the sum assured is charged for this purpose.
To claim its benefits, the claimant has to produce the necessary proof to the Corporation satisfaction that the accident is defined and should be covered as per the policy conditions. Usually, to claim the benefits under this option the documents such as Post-mortem Report, FIR copy, etc. are insisted upon.
4. Disability Benefit Claims:
This option includes waiver of future premiums under a LIC term plan. It also offers extended disability benefit in the form of a monthly benefit payment as mentioned in the policy conditions. One of the crucial conditions to claim this benefit is that the life assured should have total and permanent disability which precludes him from earning compensation or wages as a result of the accident.
FAQs for LIC Term Plan:
Q1) How can I make payment towards my newly bought new e-term plan?
You can make payment through your Credit/Debit card, Netbanking, Amex card, UPI, IMPS, UPI and e-wallets.
Q2) Will I have to pay extra charges if I use my credit card for the payment?
Yes, there is an existing customer convenience fees charged for the Credit Card transactions for different payment-ranges. For instance, if you use a Visa/Master Credit Card for a premium payment of up to Rs 5,000, you’ll be charged Rs 20 per transaction. Similarly, for a premium payment of up to Rs 5000 done through American Express cards, you will be charged a transaction fee of Rs 18 per transaction.
Q3) What are the different types of death covered under LIC term plans?
LIC term insurance plans cover all types of death including accidental deaths. However, death of the policyholder due to suicide/self-injury during the first year of the policy inception is not covered under the LIC term plans.
Q4) Will my premium amount change during the policy tenure once I have already bought the plan?
No, your premium amount is not going to change after you have bought the LIC term plan. However, it is still subject to service tax regulations as declared by the Government of India from time to time.
Q5) Can I appoint a minor as a nominee?
Yes, you can appoint a minor as a nominee. However, you will also have to appoint a guardian (major) for the minor nominee.
Q6) In case, I already have an existing term plan cover with any other insurance provider, can I still buy LIC term plans?
If you already have an existing term plan cover with another company and you still want to buy a LIC term plan, you will have to disclose your income details & your existing insurance cover details in the prescribed sections while applying for a term plan with LIC. Based on your eligibility and income, your request to buy a new LIC term plan can be considered.
Q7) Should I buy a LIC term insurance policy if I am already insured under a group insurance scheme provided by my employer?
It is always a good decision to buy an individual term insurance because:
- The insurance cover provided by your employer may not be a very large sum.
b. Your insurance cover may get cancelled, if your employer decides on cost-cutting.
c. You won’t be covered any longer, if you resign from your current job.
Q8) Will I be covered, even when I am travelling abroad?
With LIC term insurance plans, you are covered on international destinations, too.
Q9) How can I check the application status of a new LIC term insurance plan I have applied for?
You can check your application status by writing to the company at onlinedmkt@licindia[dot]com. Or else, you can also contact them on their toll free number 1800227717.
Q10) Can I also pay my premium at LIC helpline?
No, you cannot pay your premium at LIC helpline. To pay the premiums, you will need to visit the official website of LIC: www.licindia[dot]in .