Friday, 2 March 2012

LIC JEEVAN VRIDDHI Single Premium Policy Launched



LIC of India launched a new single premium policy named Jeevan Vriddhi with 5 times life cover. The basic sum assured of the LIC Jeevan Vriddhi policy is five times of the single premium paid by the policy holder. This basic sum assured will be paid only if the policy holder died within the policy term of 10 years. If the insured is alive till the maturity date, the policy offer a guaranteed maturity sum assured which is almost double the single premium paid by the policy holder as per the age of the policy holder when he join the policy.

Benefits of LIC’s Jeevan Vriddhi Policy


The benefits of LIC Jeevan Vriddhi Policy can be classified in to three which are Death benefit, Maturity Benefit & Loyalty addition.

Death Benefit: The death benefit of LIC Jeevan Vriddhi Policy is 5 times of the basic single premium paid by the insured. If the single premium is Rs. 50000 the Basic sum assured (Death Benefit) is Rs. 250000. If the policy holder died within the maturity period the nominee will get the basic sum assured.

Maturity Benefit: Maturity benefit of Jeevan Vridhi Policy is varying according to the joining age of the policy holder. It varies from 98.5 % to 58% as the starting age of the policy holder. This maturity sum assured is also known as guaranteed sum assured and LIC of India is bound to pay the guaranteed sum assured to the policy holder after the maturity, if he or she is alive at that time. The following tables show the guaranteed sum assured for different joining age for a single premium of Rs. 100000.

Joining Age            Guaranteed sum assured

8 years             -               Rs. 198460 

10 years           -               Rs. 197915

15 years           -               Rs. 196405

20 years           -               Rs. 195550

25 years           -               Rs. 195095

30 years           -               Rs. 194160

40 years           -               Rs. 185710

50 years           -               Rs. 158225

If a person joins the policy at the younger age he will get the guaranteed sum assured which is almost double the single premium paid by the policy holder. When the joining age become high the guaranteed sum assured become less.  The chances of occurring death within the policy term are high in older age.

Loyalty addition: The LIC of India also pays loyalty addition according to the performance of the corporation. This loyalty addition is the additional benefit at the time of maturity. This may vary as per the experience of the LIC of India and not a guaranteed amount.

Minimum & Maximum age of entry: The minimum age of entry is 8 years (completed) and the maximum age of entry is 50 years (nearest birthday) for this New LICs Jeevan Vriddhi single premium policy.  

Minimum & Maximum Premium and basic sum assured: The minimum single premium for LIC Jeevan Vriddhi policy is Rs. 30000 and Multiples of Rs. 1000 thereafter. The minimum basic sum assured is the 5 times of 30000, which is Rs. 150000.  There is no maximum limit specified in the LIC of India’s Sales brochure.

Policy term and Premium Payment mode: The term of the new LIC JEEVAN VRIDDHI Single Premium Policy is 10 years and the premium payment mode is single premium.

Higher Premium Incentive: There is an increase in the guaranteed maturity sum assured as incentive of higher single premium payment. 1.25% increase in guaranteed maturity sum assured for a premium from Rs. 50000 to Rs. 99,000 and 3% increase for a premium of Rs.100000 and more.

Other terms: You can take loan from the policy after one year of the policy and can surrender the policy after one year with a minimum surrender value of 90% of the single premium paid by the policy holder. There is a cooling off period of 15 days and you can withdraw the premium in this period and the policy holder will get the full premium amount after deducting initial expenses if any.

The policy is attractive for elders with the 5 times basic sum assured and also attractive to younger age group with about 100% guaranteed maturity sum assured.

5 comments :

  1. Yadavrao Vedu Patil6 March 2012 at 08:24

    The policy is seems to be very nice but upper age limit should have been 60 or so as Indian average alive age has gone above 70s.Thank you.

    ReplyDelete
  2. Yes, you are right and I also support your opinion. But insurance company, the largest insurance company in India has its own records and experience to fix the minimum age of joining each policy and the sum assured for each. This may be their decision.

    ReplyDelete
  3. The policy is should clear as under
    How much i get loyalty orThis loyalty addition after (after10yrs.) matuarity bonus
    if i invested Rs.30000/-

    ReplyDelete
  4. Ramesh
    we cannot predict the loyalty addition of LIC right now. It is declare by LIC time to time.
    They offer a loyalty addition in addition to the guaranteed sum assured. When you join
    This scheme you just calculate the loyalty addition as low as possible.

    ReplyDelete
  5. What is the risk element premium and what constitute the savings element?
    What is the assumed rate of interest?
    Can you give a comparative chart for savings part alone with the present bank rate for public , if the risk insurance is separated as it only is the component in insurance area?

    ReplyDelete