Comparison between Table no. 814 and Table no. 14 of LIC
Posted by:V.K. sharma, January - 05 - 2014

Comparison between Table no. 814 to Table no. 14

Endowment Assurance Plan (Table No. 14) New Endowment Plan (Table No.814)
Maturity Benefit Basic Sum Assured along with Vested Simple Reversionary Bonuses and Final Additional Bonus, if Any. No Change
Death Benefit Sum Assured (SA) along with Vested Simple Reversionary Bonuses and Final Additional Bonus, if any. ‘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.
Age at entry 12 to 65 years 8 to 55 years
Age at Maturity Maximum  75 years Maximum  75 years
Policy Term 5 to 55 years 12 to 35 years
Premium mode Yearly, Half-yearly, Quarterly, Monthly (SSS or ECS) Yearly, Half-yearly, Quarterly, Monthly (SSS or ECS)
Basic Sum Assured 50,000 and above 1,00,000 and above ( In multiples of 5000)
Rebate
  • 3% of tabular Premium for Yearly premium
  • 1.5% of tabular premium for Half-Yearly premium
  • 2% of tabular premium for Yearly premium
  • 1% of tabular premium for Half-Yearly premium
Loan
  • Available after payment of 3 full year’s premiums.
  • Loan granted shall be 90% of the Surrender Value in case of in force policies and 85% of the Surrender Value in case of Paid-up policies.
  • Foreclosure action shall be initiated on default of 2 or more half-yearly loan interest installments.
  • 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 in force policies even if there is default of loan interest.
Guaranteed Surrender Value (GSV)
  • Available after payment of 3 full years premiums
  • GSV shall be equal to 30% of the total premiums paid less First Year Premium and extra premium, if any.
  • Available after payment of 3 full year’s 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)
Main Changes
  • A  Policy may be revived within a period of 5 years from the date of first unpaid premium.
  • Taxes, if any, were borne by the Corporation.
  • A  Policy may be revived within a period of 2 years from the date of first unpaid premium.
  • Taxes, if any, shall be applicable at the prevailing rates and borne by the policyholder as per rules.
NO Changes in
  • Back Dating
  • Paid-up Value
  • Grace Period
  • Assignment/Nomination
  • Back Dating
  • Paid-up Value
  • Grace Period
  • Assignment/Nomination
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 (Table No 814)

New Endowment Plan

LIC’s New endowment plan is introduced with effect of 3rd Jan 2014. This is  conventional with profit Endowment assurance plan.

Eligibility conditions and restrictions:

1)  Minimum Age at entry for Life Assured   : 8 years (completed)

2) Maximum Age at entry for Life Assured   : 55 years (nearest birthday)

3) Minimum Policy Term                               : 12 years

4) Maximum Policy Term                              : 35 years

5) Minimum age at Maturity                          : 18 years (Completed)

6) Maximum age at Maturity                         :  75 years (Nearest Birthday)

7) Premium payment mode                         : Yearly, Half-yearly, Quarterly, Monthly (SSS or

ECS )

8) Minimum Sum Assured                           : Rs 1,00,000/-

9) Maximum Sum Assured                          : No Limit

The Sum Assured shall be in multiple of Rs 5000/-

 

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Benefits:

Maturity Benefit – Basic Sum Assured along with Vested Simple Reversionary Bonuses and Final Additional Bonus.

Death Benefit – “Sum  Assured on Death” along with Vested Simple Reversionary Bonuses and Final Additional Bonus.

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 Annualized Premium(10 x AP).

Note: The premiums mentioned in death benefit are excluding taxes, extra premiums and premiums for riders, if any

Guaranteed Surrender Value – Available after payment of 3 full years premiums.

Guaranteed Surrender Value shall be a percentage of total premiums paid excluding extra premium, if any and premium paid for riders, if opted for.

Examples of Guaranteed Surrender Value factors applicable for total  premiums paid are as under:

S.No.           Policy Year                  Guaranteed Surrender Value factor

1                           3                     30%

2                           5                     50%

3                        t -1                     80% (t=Policy Term)

Note: Guaranteed Surrender Value factor applicable to vested bonus

Examples of Vested bonus factors are as under:

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.

LoanAvailable 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 in force  policies even if there is default of loan interest.

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LIC’s SINGLE PREMIUM ENDOWMENT PLAN (TABLE NO. 817)
Posted by:V.K. sharma, January - 02 - 2014

  Table no. 817

(Single Premium Endowment Plan)

LIC’s single premium endowment plan is introduced with effect of 1st Jan 2014. This is single premium conventional with profit Endowment assurance plan.

Eligibility conditions and restrictions:

1)  Minimum Age at entry for Life Assured   : 90 days (completed)

2) Maximum Age at entry for Life Assured   : 65 years (nearest birthday)

3) Minimum Policy Term                               : 10 years

4) Maximum Policy Term                              : 25 years

5) Minimum age at Maturity                          : 18 years (Completed)

6) Maximum age at Maturity                         :  75 years (Nearest Birthday)

7) Premium payment mode                         : Single Premium Only

8) Minimum Sum Assured                           : Rs 50,000/-

9) Maximum Sum Assured                          : No Limit

The Sum Assured shall be in multiple of Rs 5000/-

Note: Age at entry for the life assured is to be taken as age nearest birthday except for the minimum age at entry i.e. 90 days

Date of commencement of risk : In case the age at entry of the life assured is less than 8 years, risk under this plan will commence either 2 years from the date of commencement of from the policy anniversary coinciding with or immediately following the attainment of 8 years of age, which ever is earlier. For those aged 8 years or more, risk will commence immediately.

Benefits:

a) Benefits payable on maturity

On survival to the end of the policy term, sum assured along with vested simple reversionary bonuses and final additional bonus shall be payable.

b) Benefits payable on death

On Death of life assured on or after the commencement of risk cover

Sum assured along with vested simple reversionary and final additional bonus will be payable.

On death of life assured before the commencement of risk

Return of single premium excluding taxes and extra premium if any shall be payable.

Benefits to people who buy policies with HIGH SUM ASSURED (per thousand Sum Assured) is as under:

Sum Assured (S.A.)                  Rebate (Rs)

50,000 to 95,000                         Nil

1,00,000 to 1,95,000                  18%o S.A.

2,00,000 to 2,95,000                  25%o S.A.

3,00,000 and above                   30%o S.A.

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Surrender Value:

The policy can be surrender any time during the policy term subject to realization of premium cheque.

Guaranteed Surrender Value:

The guaranteed Surrender Value shall be as under:

First Year : 70% of the single premium excluding taxes and extra premium, if any

Thereafter: 90% of the single premium excluding taxes and extra premium, if any

In addition, the surrender value of vested simple reversionary bonuses, if any , shall also be payable, which is equal to vested bonus multiplied by surrender value factor applicable to vested bonuses

Loan:

Loan facility is availability under this plan after completion of one policy year subject to following conditions:

a) The maximum loan that can be grafted as a percentage of surrender value for different policy terms and the policy year in which the loan applied are as under:

Policy Year

Policy Term

Upto 15 years

16 to 20 years

21 years & above

1

55%

40%

30%

2

60%

45%

30%

3

65%

50%

35%

4

75%

55%

40%

5

80%

60%

40%

6

90%

65%

45%

7

90%

75%

50%

8

90%

80%

55%

9

90%

90%

60%

10

90%

90%

65%

11

90%

90%

75%

12

90%

90%

80%

13 & Above

90%

90%

90%

b) The rate of interest to be charged for the loan amount would be determined from time to time by the corporation

c) No foreclosure shall be taken under this plan even if there is a default in payment of loan interest. However, any loan outstanding along with interest shall be recovered from the claim proceeds at the time of exit.

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BIMA VISHWAS

TABLE NO. 936

COMING SOON….

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LIC JEEVAN SUGANDH

Table no. 934

Coming soon…

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ALL LIC PLANS WILL BECOME EXPENSIVE AFTER 30th SEPT 2013
Posted by:V.K. sharma, September - 12 - 2013

All LIC Plans with either closed or altered after 30th Sept 2013. Some of the best selling policies like Jeevan Anand, Jeevan Saral, Jeevan Ankur, New Bima Gold, Jeevan Shree-I, Komal Jeevan and many more may not be available for sale after 30th Sept 2013 and if they will be available then it will be costlier because the policyholders will have to pay service tax extra over these policies.

Buy LIC POLICIES before 30th Sept 2013

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All LIC plans are becoming expensive
All LIC plans are becoming expensive

This is not merely a news article Please find the attached proof of GAZETTED NOTIFICATION of IRDA for closing the plans of LIC OF INDIA.

Plan Closure Proof
Plan Closure Proof

Buy LIC POLICIES before 30th Sept 2013

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Investors fail to renew Rs 1.9 lakh cr of insurance policies
Posted by:V.K. sharma, May - 24 - 2013

A large chunk of insurance policies from private insurers lapsed because investors didn’t pay their renewal premium, data from the IRDA’s Handbook of Statistics reveal.

Lapsed Ratio
Lapsed Ratio

 The lapse ratio was as high as 51 per cent for Birla Sun Life Insurance, 49 per cent for Future Generali and at 42 per cent and 36 per cent, respectively, for ICICI Prudential and Bharti Axa Life in 2011-12.

Lapse ratio is the proportion of policies where renewal premium was not paid.

The Life Insurance Corporation has, however, maintained lapse ratios at 4-5 per cent over the last few years.

Clubbing private players and LIC, investors didn’t renew a total of 160 lakh traditional insurance plans of the value of Rs 1.9 lakh crore (total sum assured) in 2011-12, registering a two-fold jump from 2008-09. Traditional plans include term covers, endowment policies and health insurance plans. It excludes unit linked plans (ULIPs). Had ULIPs been included the lapse ratios will be even higher.

 LACK COMMITMENT

The persistency ratio – the number of policyholders who stay with their policy for five years or more – is also low. A majority of private insurers saw less than half their policyholders staying on after the fifth year.

 Why did so many investors not renew their insurance plans? Some insurers say this is a result of investors switching plans due to changing priorities.

Saujanya Shrivastava, Chief Marketing Officer of Bharti AXA said, “Policy lapses are high mainly in the endowment segment where the policy tenure is 10 or 15 years and people lack long term commitment because of changing priorities.”

 Another side to the story could be mis-selling, where agents mis-represent the product to the prospect. The Insurance Ombudsman received a total of 1.07 lakh complaints in 2011-12 on ‘unfair business practices’ in life policies. One-third of these policyholders complained that the product was different from what was projected.

 Changing regulations that see insurers launching new products every year could also play a role.

“Insurers keep launching new products and the message that goes to consumers is that old products are not good enough. They then just try to cut losses and move away (from their older plans),” says Shashwat Sharma, Partner– KPMG (India).

 Where does the money go?

The next big question is – what happens to the premium collected on lapsed policies?

 When a traditional policy is discontinued after three years, it attains paid-up status and the surrender value as agreed is paid back to the policyholder.

However, when a buyer stops premium payments within three years, “the money is moved to reserves and carried forward for future appropriation or made available to shareholders depending on whether it is a participating or non-participating plan,” says Anish P. Amin, Partner-PwC.

 If ULIPs are included, the lapse ratios would be even higher. In a ULIP, if premium payment is stopped within five years, the money is transferred to a separate fund that earns token returns. At the end of the fifth year, the money is paid to the policyholder.

Source Business Line May 18, 2013

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LIC CLAIM REACHED NEARLY 100%
Posted by:V.K. sharma,
LIC Claim Ratio Reached 100%
LIC Claim Ratio Reached 100%

 

 

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Income Tax Slab for FY 2013-14 : Income Tax Slab for AY 2014-15
Posted by:V.K. sharma, February - 28 - 2013
Income Tax Slab for FY 2013-14 : Income Tax Slab for AY 2014-15
Income Tax Slab for FY 2013-14 : Income Tax Slab for AY 2014-15
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JEEVAN SUGAM : LIC JEEVAN SUGAM : SINGLE PREMIUM PLAN : Table no. 813
Posted by:V.K. sharma, February - 22 - 2013

                                           GUARANTEED MATURITY SINGLE PREMIUM  

             (Close ended planavailable till 10 April 2013 Tax rebate as per rules, Best for Children)

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LIC JEEVAN SUGAM is another product in the bouquet of Single Premium plans of LIC. This plan is going to launch on 25th Feb 2013.

Unique Selling Features:

1. LIMITED PERIOD: CLOSE ENDED PLAN available only for 45 days from 25th Feb 2013

2. MATURITY BENEFIT: Guaranteed Maturity Sum Assured (GUARANTEED) + Loyalty addition.

3. One time investment with NO UPPER LIMITED

4. DEATH BENEFIT:

If Death occurs with in 5 years, 10 times of the premium paid (excluding any premium any)

If Death occurs after 5 years, 10 times of the premium paid + Loyalty Addition.

5. EASY LIQUIDITY: Loan/SV available immediately after taking policy.

Guaranteed Surrender Value:

a) First year: 70% of the single premium excluding extra premium, if any.

b) Thereafter: 90% of the single premium excluding extra premium, if any

6. Plan available for children aged 8 years & Above but equal to 45 years of age (nearest B Day)

Eligibility Conditions:

Minimum age Entry:                  8 years completed

Maximum age Entry:                 45 years ( Nearest B day)

Policy Term:                               10years

Mode of premium payment:   Single Premium

Maturity Sum Assured:           Minimum – Rs 60,000(Max – No upper limit)

Increased Maturity for higher maturity sum assured

Maturity Sum Assured                          Increase in maturity sum assured

Below Rs 150,000                                   Nil

Rs 150,000 – Rs 399,999                       3.50%

Rs 400,000 and above                           4.50%

Miscellaneous:

Form no. 300 for 18years and 18years above and Form no. 340 for age 8years to 18years.

The service tax 3.09% will be applicable on the single premium.

Loan will be available on this policy from day 1 @ 10.45% compounded half yearly.

Back dating is possible in the same financial year and the interest to be charged @10 % p.a.

Download Yield Calculator for 813-YIELD CALCULATOR

Download Pamphlet for Sugam Phamphlet

Download ready Premium Chart for Jeevan sugam ready premium chart

Download Power point presentation for Jeevan Sugam ppt

Watch the video Below (in Hindi) How LIC JEEVAN SUGAM works?

[youtube]http://www.youtube.com/watch?v=JQaUcoz3kw8&feature=youtu.be[/youtube]

 

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