Key Features of LIC Jeevan Nidhi Plan
§ This plan is a deferred pension plan with bonus facility
§ The corpus for pension is (Sum Assured + accrued Guaranteed Additions + simple Reversionary Bonus + Terminal Bonus)
§ Death Benefit before Vesting Date is also (Sum Assured + accrued Guaranteed Additions + simple Reversionary Bonus + Terminal Bonus).
§ Death Benefit after the Vesting Date depends on the annuity option chosen.
§ Upon Vesting, there are 2 Vesting Options available to the life insured
o He may choose to withdraw 1/3rd of the corpus tax free and avail pension from the remaining 2/3rd of the corpus
o He may choose to avail pension from the entire corpus
§ There are 5 options for Pension- Annuity for Life- where pension is paid till the life assured is alive and nothing is payable on death, Annuity Guaranteed for Certain Periods- where pension is paid for 5/10/15 or 20 years as chosen whether the life assured is alive or not, Annuity with Return of Purchase Price on Death- pension is paid till the life assured is alive and the remaining amount of the corpus is paid to the nominee as death benefit , Increasing Annuity- pension is paid till the life assured is alive at an increasing rate of 3% p.a. and Joint Life Last Survivor Annuity- pension is paid till the life assured is alive. On the death of the life insured, 50% of the pension is payable to spouse as long as the spouse if alive.
§ Optional higher cover through Term Rider, Accidental Death and Disability Benefit rider and Critical Illness Rider and Premium Waiver Rider for Critical Illnesses.
§ This plan has Guaranteed Additions for the first 5 years
§ There is large sum assured rebate.
Benefits you get from LIC Jeevan Nidhi Plan
Death Benefit – In case of death of the Life Insured before the vesting date, the nominee receives
· Sum Assured plus
· accrued Guaranteed Additions plus
· simple Reversionary Bonus plus
· Terminal Bonus
In case of death of the Life Insured after the vesting date, it entirely depends upon pension option chosen.
Maturity Benefit – At the maturity of the policy, the insured will get some choices
· To choose whether to withdraw 1/3rd of the fund tax free and avail pension from the remaining or take pension from the entire corpus
· To choose the type of pension
o Annuity for Life- where pension is paid till the life assured is alive and nothing is payable on death
o Annuity Guaranteed for Certain Periods- where pension is paid for 5/10/15 or 20 years as chosen whether the life assured is alive or not
o Annuity with Return of Purchase Price on Death- pension is paid till the life assured is alive and the remaining amount of the corpus is paid to the nominee as death benefit
o Increasing Annuity- pension is paid till the life assured is alive at an increasing rate of 3% p.a.
o Joint Life Last Survivor Annuity- pension is paid till the life assured is alive. On the death of the life insured, 50% of the pension is payable to spouse as long as the spouse if alive.
Income Tax Benefit – Premiums paid under life insurance policy are exempted from tax under Section 80 C and 1/3rd of the maturity proceeds are exempted from tax under Section 10 (10A). Pension that is received is taxable.
Eligibility conditions and other restrictions in LIC Jeevan Nidhi Plan
§ This plan is a deferred pension plan with bonus facility
§ The corpus for pension is (Sum Assured + accrued Guaranteed Additions + simple Reversionary Bonus + Terminal Bonus)
§ Death Benefit before Vesting Date is also (Sum Assured + accrued Guaranteed Additions + simple Reversionary Bonus + Terminal Bonus).
§ Death Benefit after the Vesting Date depends on the annuity option chosen.
§ Upon Vesting, there are 2 Vesting Options available to the life insured
o He may choose to withdraw 1/3rd of the corpus tax free and avail pension from the remaining 2/3rd of the corpus
o He may choose to avail pension from the entire corpus
§ There are 5 options for Pension- Annuity for Life- where pension is paid till the life assured is alive and nothing is payable on death, Annuity Guaranteed for Certain Periods- where pension is paid for 5/10/15 or 20 years as chosen whether the life assured is alive or not, Annuity with Return of Purchase Price on Death- pension is paid till the life assured is alive and the remaining amount of the corpus is paid to the nominee as death benefit , Increasing Annuity- pension is paid till the life assured is alive at an increasing rate of 3% p.a. and Joint Life Last Survivor Annuity- pension is paid till the life assured is alive. On the death of the life insured, 50% of the pension is payable to spouse as long as the spouse if alive.
§ Optional higher cover through Term Rider, Accidental Death and Disability Benefit rider and Critical Illness Rider and Premium Waiver Rider for Critical Illnesses.
§ This plan has Guaranteed Additions for the first 5 years
§ There is large sum assured rebate.
Benefits you get from LIC Jeevan Nidhi Plan
Death Benefit – In case of death of the Life Insured before the vesting date, the nominee receives
· Sum Assured plus
· accrued Guaranteed Additions plus
· simple Reversionary Bonus plus
· Terminal Bonus
In case of death of the Life Insured after the vesting date, it entirely depends upon pension option chosen.
Maturity Benefit – At the maturity of the policy, the insured will get some choices
· To choose whether to withdraw 1/3rd of the fund tax free and avail pension from the remaining or take pension from the entire corpus
· To choose the type of pension
o Annuity for Life- where pension is paid till the life assured is alive and nothing is payable on death
o Annuity Guaranteed for Certain Periods- where pension is paid for 5/10/15 or 20 years as chosen whether the life assured is alive or not
o Annuity with Return of Purchase Price on Death- pension is paid till the life assured is alive and the remaining amount of the corpus is paid to the nominee as death benefit
o Increasing Annuity- pension is paid till the life assured is alive at an increasing rate of 3% p.a.
o Joint Life Last Survivor Annuity- pension is paid till the life assured is alive. On the death of the life insured, 50% of the pension is payable to spouse as long as the spouse if alive.
Income Tax Benefit – Premiums paid under life insurance policy are exempted from tax under Section 80 C and 1/3rd of the maturity proceeds are exempted from tax under Section 10 (10A). Pension that is received is taxable.
Eligibility conditions and other restrictions in LIC Jeevan Nidhi Plan
Minimum
|
Maximum
|
|
Sum Assured (in Rs.)
|
50,000
|
No Limit
|
Policy Term (in years)
|
5 for Regular Premium
6 for Single Premium
|
35
|
Premium Payment Term (in years)
|
||
Entry Age of Policyholder (in years)
|
18
|
65
|
Age at Vesting (in years)
|
40
|
75
|
Premium (in Rs.)
|
10,000 for Single
3000 for Regular
|
No Limit
|
Payment modes
|
Single, Yearly, Half-yearly, Quarterly, Monthly and SSS
|
|
Sample illustration of LIC Jeevan Nidhi Plan
The below illustration is for a healthy Male of 35 years (non-tobacco user) opting for a Annual Premium = Rs. 4121 and Policy Term = 25 years respectively.
Guaranteed Maturity Benefit = Rs 1,00,000 (Sum Assured) + Rs 5000 guaranteed addition in the first 5 years
Additional Features and Benefits of LIC Jeevan Nidhi Plan
Riders- There are 4 additional riders available:
· Accidental Death and Disability Benefit rider
· Term Assurance Rider
· Critical Illness Rider
· Premium Waiver Benefit Option can be opted for if Critical Illness Rider has been taken.
What happens if?
You stop paying the premium – If you stop paying the premiums after 3 policy years, the policy lapses and all benefits cease.
You want to surrender the policy – There is a Guaranteed Surrender Value after 3 policy years
Guaranteed Surrender Value = 30% of all premiums paid (90% for Single Premium) – 1st year’s premium
There is Special Surrender Value under this plan as well.
You want a loan against your policy – Loan facility is not available under this policy
Alternate pension plans from different insurance companies
1. Aegon Religare Pension Plan
2. Tata AIG Life Nirvana
3. ICICI Pru Forever Life
Other pension plans from Life Insurance Corporation of India
1. LIC Pension Plus - ULIP
2. LIC New Jeevan Suraksha 1
3. LIC New Jeevan Dhara 1
4. LIC Jeevan Akshay 6
Death Benefit:
1) If Death occurs with in first 5 years of starting LIC JEEVAN NIDHI, Sum assured along with guaranteed accrued bonus will be paid
2) If Death occurs after 5 years, Sum assured, Guaranteed bonus and vested reversionary bonus
*1 and final additional bonus
*2. Maturity Benefit:
1) Pension: Option to purchase pension on maturity
2) Reinvest: Maturity proceed can be reinvested into single premium deferred pension plan. Back dating - Allowed within same Financial year. Eligibility conditions: Eligibility conditions and other restrictions in LIC Jeevan Nidhi Plan Description Minimum Maximum Sum Assured (in Rs.) 50,000 No Limit Policy Term (in years) 5 for Regular Premium 6 for Single Premium 35 Years Entry Age of Policyholder (in years) 18 Years 65 Years Age at Vesting (in years) 40 Years 75 Years Premium (in Rs.) 10,000 for Single 3000 for Regular No Limit Payment modes Single, Yearly, Half-yearly, Quarterly, Monthly and SSS Revival: A policy may be revived within a period of 5 years from the date of First Unpaid premium and before the date of vesting by payment of Arrears of premium plus Interest and subject to continued insurability. Surrender: The policy can be surrendered at any time on payment of at least 3 years' premiums and after completion of at least 3 policy years but before the date on which annuity vests. The Surrender Value payable shall be the higher of Guaranteed Surrendered Value and Special Surrender Value. The Surrender proceeds shall be utilized to purchase an immediate annuity product or a new Single Premium deferred pension product from LIC.
*1: Reversionary Bonus shall be added from the 6th policy year onwards till the end of the deferment period and at such rates as may be declared by the Corporation.
*2:Final Additional Bonus shall be payable either on vesting or on earlier death at the rates declared by the Corporation. Service Tax: Service tax, if any, shall be as per the Service Tax laws and the rate of service tax as applicable from time to time. The amount of service tax as per the prevailing rates shall be payable by the policyholder on premium(s) as and when the premiums are paid. Cooling-off period: If the Life Assured is not satisfied with the 'Terms and Conditions' of the policy, he/she may return the policy to the Corporation within 15 days from the date of receipt of the policy stating the reason of objections. On receipt of the same the Corporation shall cancel the policy and return the amount of premium deposited after deducting the risk premium, expenses incurred on medical examination and stamp duty.
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