The LIC Gratuity Plus Plan is a unit-linked insurance plan (ULIP) specifically designed for companies to manage their gratuity funds efficiently. With this plan, companies can delegate gratuity responsibilities to a reliable insurer while having the flexibility to choose from diverse investment options. Unlike traditional cash accumulation plans, the returns here are tied to the performance of selected funds, providing potential for growth aligned with investment choices.
Key Features of the LIC Gratuity Plus Plan
1. Trusted Insurer
LIC (Life Insurance Corporation of India) offers this plan, leveraging its reputation and extensive experience with over 16 crore policyholders. With an asset size of approximately ?4.5 lakh crores, LIC is one of India’s most prominent insurers, instilling confidence in the security and management of the funds.
2. Diverse Investment Options
The plan offers a choice between four different funds, each catering to distinct risk profiles:
- Bond Fund – Suitable for conservative investors.
- Income Fund – For moderate returns with controlled risk.
- Balanced Fund – A middle-ground option combining equity and debt.
- Growth Fund – For those seeking potentially higher returns with greater risk.
3. Flexible Cost Structuring
The plan allows companies to structure gratuity costs flexibly, depending on the performance of the chosen fund, offering adaptability to fluctuating financial scenarios.
4. Free Fund Switching
Policyholders can switch between funds once annually without incurring additional charges. This feature enhances investment flexibility, enabling companies to adjust their portfolios based on market performance.
5. Affordable Life Insurance Coverage
The LIC Gratuity Plus Plan also includes life insurance coverage at minimal costs, which can be linked to the gratuity payable for anticipated service, or set as a uniform cover from a minimum of one month’s salary per member. This ensures employee security along with gratuity benefits.
6. No Bid-Offer Spread
This feature eliminates hidden costs when buying or selling units, ensuring greater transparency for policyholders.
7. Surrender Flexibility
Companies have the option to surrender the scheme at any time without incurring penalties. This added flexibility makes it convenient for companies to adapt the plan to changing business requirements.
8. Streamlined Administration
Designed for hassle-free administration, the LIC Gratuity Plus Plan simplifies management, making it easy for companies to handle their gratuity obligations.
9. Legal Assistance Provided by LIC
LIC provides assistance in setting up the scheme and in executing necessary legal documents, ensuring compliance with regulatory requirements.
For readers interested in other flexible insurance plans, the LIC Jeevan Umang Plan offers another noteworthy option with lifetime benefits, providing financial security to policyholders.
Special Features: Auto Cover Provision
In cases where contributions are not received by the policy anniversary, the policy will become “paid-up,” with an auto cover provision extending term assurance coverage for up to five years. During this period, mortality charges are deducted from the unit account, maintaining coverage equal to future service gratuity or a minimum of one month’s salary per member, based on the policyholder’s choice. If contributions remain unpaid after five years, the policy will terminate.
If you are exploring similar investment-linked options, the LIC Jeevan Shagun Plan offers flexible features tailored to meet individual financial goals.
Conclusion
The LIC Gratuity Plus Plan is a compelling solution for companies managing their gratuity obligations. Its unique features, such as diverse investment options, free fund switching, and flexible cost structuring, make it an efficient choice. Furthermore, LIC’s reputable brand and reliable support simplify the administration of gratuity funds. Companies looking for an effective way to manage employee benefits while ensuring life insurance coverage will find the LIC Gratuity Plus Plan an advantageous addition.
For more on related insurance plans and tax-saving strategies, check out our guide on ULIP Insurance Plans and How They Work.
By incorporating the LIC Gratuity Plus Plan into your company’s benefits portfolio, you can create a financially secure environment for employees, enhancing their future financial stability.
