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A Single Premium Guaranteed Returns Plan

Monday, February 03, 2014
By Manoj Aswani

Product Review: LIC New Bima Bachat Plan

Plan Summary
LIC New Bima Bachat Plan is a Single Premium Guaranteed Returns Money Back Plan. This is a Non Linked Insurance Traditional Plan where 15% of the Sum Assured is paid at the end of every 3 years. On survival till the end of the Policy Tenure, the Single Premium paid along with Loyalty Addition would be paid to the Policyholder as Maturity Benefit.

However, if the Life Insured dies within the policy tenure, the entire Sum Assured is paid irrespective of the amount of money paid as Survival Benefit. 

Key Features

  • This is a single premium plan
  • Loyalty Addition accrues at least after 5 Policy Years
  • Loyalty Addition is payable on Policy Maturity or on earlier death
  • 15% of the Sum Assured is paid after every 3 years as Survival Benefit
  • There are 3 policy tenures possible- 9 years, 12 years and 15 years
  • There is a Sum Assured Rebate for large Sum Assured

Benefits: Death Benefit  – Death Benefit – In case of death of the Life Insured,

  • Within the first 5 Policy Years, the Nominee would receive the entire Sum Assured, irrespective of the Survival Benefits already paid
  • After the first 5 Policy Years, the Nominee would receive the entire Sum Assured, irrespective of the Survival Benefits already paid + Loyalty Addition

Eligibility


Survival Benefit – The Life Insured would receive the following Survival Benefit

  • For a Policy Term of 9 years, 15% of Sum is payable at the end of 3 and 6 years, a total of 30% of Sum Assured is payable
  • For a Policy Term of 12 years, 15% of Sum is payable at the end of 3, 6 and 9 years, a total of 45% of Sum Assured is payable
  • For a Policy Term of 15 years, 15% of Sum is payable at the end of 3, 6, 9 and 12 years, a total of 60% of Sum Assured is payable

Maturity Benefit – On survival of the Life Insured till the end of the Policy Tenure, the entire Single Premium paid along with Loyalty Additions would be payable to the Policyholder as Maturity Benefit and the policy terminates.

Income Tax Benefit
Life Insurance premiums paid up to Rs. 1,00,000 are allowed as a deduction from the taxable income each year under section 80C. The Maturity Benefit is also tax free under section 10(10)D subject to fulfillment of all terms and conditions.

Discontinuance of Premiums
This is a single premium plan, so no question of stopping to pay your premiums

Surrender Benefit
There is a Guaranteed Surrender Value.

Riders
There is no Additional Rider available with this plan:

  • Guaranteed Surrender Value in Year 1 = 70% of Single Premium Paid – Taxes and Excess Premium
  • Guaranteed Surrender Value from Year 2 onwards = 90% of Single Premium Paid – Taxes and Excess Premium – All Survival Benefits already paid.

Loan
Loan facility is available under this policy upto 60% of Surrender Value as on the Date of Loan.

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