Introduction
LIC’s Limited Premium Endowment Plan is a participating non-linked plan which offers a combination of protection and savings. This plan provides financial support for the family in case of unfortunate death of the policyholder any time before maturity and a lump sum amount at the time of maturity for the surviving policyholder. This plan also takes care of liquidity needs through its loan facility.
Table No.
830
Plan Type
Participating Non-Linked Plan
Plan Basis
Individual
Eligiblity Criteria
Entry Age
Minimum :
18 years
Maximum :
57 years for PT=12, PPT=8
62 years for PT=12, PPT=9
59 years for PT=16
54 years for PT=21
Maturity Age
Minimum
Information Not Available
Maximum
69 years for PT=12, PPT=8
74 years for PT=12, PPT=9
75 years for all other cases
Basic Sum Assured
Maximum
Rs. 3,00,000
Minimum
No Limit
Policy Term
Minimum 12 Years
Maximum 16, 21 Years
Policy Paying Term
Minimum 8 Years
Maximum 9 Years
Premium Payment Mode
Annual, half-yearly, quarterly and monthly
Coverage
Death Benefit
- Death Benefit
- Maturity Benefit
- Participation In Profit
- Simple Reversionary Bonus
- Final (Additional) Bonus (if any)
Key Features
- This is a Participating Traditional Limited Pay Endowment Plan
- Premium needs to be paid only for a period of 8 or 9 years while the policy continues for the entire policy tenure of 12, 16 or 21 years as chosen
- On survival till the end of the policy tenure, the maturity benefit is paid to the policyholder and the policy terminates
- If the life insured dies within the policy tenure, the death benefit is paid to the nominee and the policy terminates
- There is additional coverage which can be opted for additional premium
Policy Benefits
Death Benefit
In case of the death of the policyholder before the end of the policy term, the nominee will receive all of the following:
- “Sum Assured on Death” – this is defined below
- Simple Reversionary Bonus
- Final Addition Bonus
The Sum Assured on Death mentioned above is defined as the highest of the following:
- 10 times the Annualised Premium
- 125% of Basic Sum Assured
- 105% of all premiums paid
The premiums mentioned above refer to premiums without the tax component and also does not consider any rider premiums.
Maturity Benefit
At the end of the policy term, the policyholder will receive the following:
- Basic Sum Assured
- Simple Reversionary Bonus which has accrued
- Final Addition Bonus if declared
Rebate
2% on yearly, 1% on Half Yearly, Nil on Quarterly
Profit Participation
The policy shall participate in profits of the Corporation and shall be entitled to receive Simple Reversionary Bonuses declared as per the experience of the Corporation, provided the policy is in full force.
Final (Additional) Bonus may also be declared under the policy in the year when the policy results into a claim either by death or maturity.
Ideal Plan
This plan is highly suitable for NRI’s and High Net worth Individuals (HNIs), who have high income in the current period but cannot guarantee it for a long period.
Tax Benefits
The premium paid for Limited Premium Endowment Plan is exempted u/s 80C of income tax act. The entire maturity amount is also exempted from income tax u/s 10(10D) of Income tax act.
Loans
- Loan Facility is available in this policy.
- Minimum 2 years premium should be paid to get eligibility for taking a loan.
- Maximum Loan amount granted will be
- 90% for in-force policies.
- 80% for paid up policies.
Riders
Accidental Death and Disability Rider
You can opt for this rider at any point in time within the term during which premiums for the basic plan have to be paid. This is provided the premium paying term is a minimum of 5 years. Thus, this rider can be opted for in the initial 3 years of a plan where the premium paying term is a minimum of 8 years. If the premium paying term is 9 years, then this rider can be opted for within the first 4 years. The minimum sum assured under this rider is Rs.10,000 and the maximum is Rs. 1 crore. The benefit cover would be available before the policy anniversary where the age of the insured is closer to 70 years, or before the policy anniversary – whichever is earlier.
Disability Benefit Rider
Write down here
LIC’s New Term Assurance Rider
You can opt for this rider any time within the premium payment term, subject to the outstanding premium payment term being a minimum of 5 years. The minimum sum assured for the term assurance rider is Rs.1 lakh, and the maximum is Rs.25 lakh. The benefit cover will be available either before the anniversary of the policy where the age of the policyholder is closer to 70 years, or during the policy term – whichever comes sooner.
Surrender Value
After 2 years of full premium payment
Guaranteed Surrender Value
The guaranteed surrender value would be a percentage of the total premiums paid (net of taxes) excluding the extra premium, if any. It also includes the premium paid for riders, if such an option has been taken. The guaranteed surrender value factor will be applicable to the vested simple reversionary bonus, if any.
From 30% to Maximum 80% of total premium paid
Special Surrender Value
The special surrender value will be the discounted value of the paid-up sum assured and the vested simple reversionary bonuses.
Paid Up Value
- On the death of the policyholder, the paid-up value of the sum assured is as per the following formula –
Paid up sum assured (Death) = Sum assured on death of policyholder x (number of premiums already paid/number of premiums that are payable during the premium paying term)
- The sum assured due on maturity under a paid-up policy is as follows –
Paid up sum assured (Maturity) = Sum Assured on Maturity of policy x (number of premiums already paid/number of premiums that are payable)
Policy Stamping
Stamping charges are also applicable to this policy, and will be 20 paise per thousand of the sum assured.
Rebates
Rebate means discounts on premium
Rebate on Premium Payment Mode
| Premium Payment Mode | Percentage |
| Yearly Mode | 2% of Tabular Premium. |
| Half yearly Mode | 1% of Tabular Premium. |
| Quarterly and Monthly | Nil. |
Rebate on Sum Assured
Write down here
High Sum Assured and Mode Rebate
| Basic Sum Assured (BSA) or Policy Value | Rebate per Rs. 1000 /- Sum Assured |
| 3,00,000 to 4,90,000 | NIL. |
| 5,00,000 to 9,90,000 | 0.50 %of B.S.A. |
| 10,00,000 and Above | 0.75% of B.S.A. |
Other Details
Revival Period
Policy should be revived until 2 years from last unpaid premium.
Free Look Period
If you would not be pleased with the coverage, and terms and conditions of the policy, you have the option of canceling the policy within 15 days of receipt of the policy documents, provided there has been no claim.
Grace Period
30 days’ grace period is allowed for premium payment. If policyholder fails to make payment within the grace period, the policy lapses. However, there is a period of 2 years from the due date of the first unpaid premium for the policy to be revived
Nomination
Write down here
Assignment
Write down here
Exclusions
Suicide
If Policy Holder Commits Suicide within one year from date of taking the policy, 80% of paid premium will be returned back. If committed suicide after 1 year then Full Sum Assured + Bonus will be paid by LIC to their nominee.
Claim Process
Death Claim
Write down here
Maturity Claim
Write down here
Surrender Claim
Write down here
Examples
Write down here
FAQs
Case 2 : Accidental Demise during policy :
In case, during the policy tenure, Viren dies due to an accident, his nominee will take delivery of the Demise Sum Assured (125 percent of Rs 3, 00, 000) + Additional Accidental Sum Assured (Rs 3, 00, 000) + Accrued Bonuses. The policies will terminate post this event.
Case 3 : continued existence till maturity :
If Viren survives till the conclusion of policy tenure, he will get the Basic Sum Assured i.e. Rs 3, 00, 000 + Accrued Bonuses. Thereafter, policies will terminate.
Q2. Can I surrender my policy prior to maturity?
A2. You can surrender your policy prior to maturity. A policy acquires surrender value post completion of paying premiums of 2 years policy.
Q3. Is loan facility is obtainable under this policy?
A3. Yes, loan facility is obtainable under this policy after paying 2 years of complete premium.
Q4. If premium is not paid then is there any possibility of renewing the policy?
A4. If the premium is not paid by you within the grace period of 15 days for monthly mode & 30 days for remaining modes then the policy will lapse. If you are interested to carry on this policy then you can renew your policy on or before 2 years from date of first unpaid premium.