Life Insurance Corporation of India (LIC) has launched a new non-linked, non-participating Individual, Savings, whole life insurance product that offers income benefits of 10 per cent of the sum assured.
It provides financial support to family in case of unfortunate death of Life Assured and survival benefits in the form of Regular Income Benefit or Flexi Income Benefit as per the option chosen for surviving policyholder.
The minimum age at entry is eight years, while the maximum age limit is 65 years. The premium paying terms range from five to 16 years. The minimum sum assured under this limited premium payment policy is Rs 5 lakh.
The income benefit, that is, survival benefit, will start flowing in after the periods specified in the policy that are, in turn, linked the premium paying term. You can choose between two payout options - Regular Income Benefit and Flexi Income Benefit.
Regular Income Benefit - On survival of Life Assured, Regular Income Benefit equal to 10 percent of the basic sum assured chosen by the policyholder will be paid from the 11th policy year onwards, depending on the premium paying term chosen.
Since the payouts are made periodically under this whole life plan, there is no lump-sum, maturity benefit, bonus, that will be paid out under the policy.
In the case of the ‘Flexi income benefit’ option, too, you will receive payouts worth 10 percent of the basic sum assured at the end of each policy year, depending on the premium paying term chosen. The premium-paying term-income benefit payout matrix is applicable to this option too.
However, here, you will have the flexibility to defer these payouts and earn interest on the accumulated balance. LIC will pay interest on these deferred benefits at the rate of 5.5 percent per annum, compounding yearly till the date of withdrawal or surrender or death, whichever is earlier.
However, you can also make a written request to withdraw, once in a policy year, up to 75 percent of the accumulated benefits, including interest. The balance amount will continue to earn interest of 5.5 percent per annum.
In the case of death, policyholders’ dependents will receive a death benefit that is equivalent to the ‘Sum Assured on Death’ along with accrued guaranteed additions shall be payable in-force policies. In line with the insurance regulator’s mandate, the sum assured on death will be at least seven times the annual premiums. The Death Benefit shall not be less than 105% of total premiums paid.
As per the product brochure, Under inforce policy, LIC will credit guaranteed additions at the rate of Rs 40 per thousand basic sum assured at the end of each policy year during the premium paying term.
|