LIC Samridhi Plus

LIC Samridhi Plus

LIC Samridhi Plus (Plan No.804) is a ULIP plan. It’s a close-ended plan which would be open for sale for a maximum period of 3 months.

Samridhi Plus Plan at Glance:

  • Guaranteed Highest NAV of the first 100 months at Maturity
  • Policy Term 10 years
  • Lock-in period 5 years
  • Limited Premium Payment (5 years or single premium)
  • Unlimited investment under Single Premium
  • Insurance Protection
  • Easy liquidity through Partial Withdrawals
  • Entry age 8 to 65 years

LIC Samridhi Plus with a policy term of 10 years that offers payment of Fund Value at the end of the policy term based on the highest Net Asset Value (NAV) over the first 100 months of the policy or the NAV as applicable at the end of the policy term, whichever is higher. The premium payment under this plan is limited to single or 5 years. The policyholder can choose the level of cover within the limits, depending on his/her age.

Benefits payable on death:

The nominee will get Sum Assured or Policyholder’s Fund Value whichever is higher

Maturity Benefit:

Highest NAV Fund Value Or Maturity Fund Value Whichever is higher.

Guaranteed NAV:

In this plan, there is a guarantee of the highest NAV recorded on a daily basis, in the first 100 months of the policy, subject to a minimum of Rs. 10/-. The guarantee will be applicable only for units available in the policyholder’s fund at the end of the policy term. The period to be counted for a guarantee of NAV shall be 100 months from the date of commencement of the policy.

Eligibility condition and restrictions for LIC Samridhi Plus

a) Minimum Basic Sum Assured:

  • 5-year Premium paying term policies:
  • For age at entry below 45 years: 10 times the annualized premium
  • For age at entry 45 years and above: 7 times the annualized premium

Single-Premium:

  • For age at entry below 45 years: 1.25 times the single premium
  • For age at entry 45 years and above: 1.10 times the single premium

b)Maximum Basic Sum Assured:

  • 5 years Premium paying term policies:
  • For age at entry below 45 years: 20 times the annualized premium
  • For age at entry 45 years and above: 10 times the annualized premium

Single-Premium Policies:

  • 5 times the Single premium, if the age at entry is upto 55 years.
  • 1.25 times the Single premium, if the age at entry is 56 to 65 years

Top-up: No Top-up shall be allowed under the plan.

  • Entry age: 8-65 years
  • Maturity age: 18-75 years
  • Policy Term 10 yrs
  • Premium paying term: 5yrs or single premium

Minimum Premium:

  • Yearly Premium: Rs.15000/-
  • Half Yearly: Rs.8,000/-
  • Quarterly: Rs.4,000/-
  • ECS Monthly Rs.1500/-
  • Min. Single Premium: Rs.30,000/-

Maximum premium:

  • Single-Premium: No Limit
  • Regular Premium: 1 lac p.a.

Benefit illustration (Assuming Gross Interest Rate of 10% P.a.)

  • Age:  30 years
  • Sum Assured:  Rs.200000/-
  • Policy Term:  10 years
  • Premium:  Rs.20000/- p.a.
  • Premium Paying Term:  5 years
  • Maturity Amount:  Rs.1,73,355/-

Accident Benefit:

Accident Benefit is available at an extra Rs.0.50 per thousand Sum Assured

Premium Allocation Charge:

For Single premium policies:    3.3%

For Regular premium policies:

PremiumAllocation Charge
First-year6%
2nd-5th year4.50%

Other Charges:

Policy Administration charge: Rs. 30/- per month during the first policy year and Rs 30/- per month escalating at 3% p.a. thereafter, throughout the term of the policy.

Fund Management Charges (FMC): 0.90% p.a

Guarantee Charge: 0.40% p.a

Last Date: 24th May 2011


 Update: Samridhi Plus Table No.804 Has Been Discontinued


Note:

The above is the product summary giving the key features of the plan. This is for illustrative purposes only. This does not represent a contract and for details please refer to your policy document.

Unit Linked Insurance Plan Revised

Unit Linked Insurance Plan Revised

Unit Linked Insurance Plan (ULIP) Revised Terms:

From September 01, 2010, all ULIP Plans will have the following features:

Term:
The minimum term for the ULIP plan would be 10 years.

Locking Period for Top Up:
All Top-up premium lock-in period would be 3 years. Also, Top-up premium not allowed during the last 3 years of maturity.

Compulsory Insurance:
Insurance cover is mandatory including Pension Plan Hence there will be no ULIP without risk cover.

Pension ULIP:
Withdrawals will be not allowed before maturity in the case of the Pension Plan.

Assignments and Loan:
Assignments and loans are not available in ULIP Plan.

Top-Up Premium:
Risk cover is mandatory for top-up premium and will be treated as a single premium for each time you top up.

Surrender:
Surrender before 6 years will attract a penalty.

TermSurrender DurationCharges
Less than 10 yrs1st year12.5%
 2nd year10%
 3rd year7.5%
 4th year5%
 5th year2.5%
 6th yearNil
More than 10 yrs1st year15%
 2nd year12.5%
 3rd year10%
 4th year7.5%
 5th year5%
 6th year2.5%
Pension Plus Plan 803 – ULIP Based

Pension Plus Plan 803 – ULIP Based

LIC Pension Plus is a unit-linked deferred pension plan, which provides you a minimum guarantee on the gross premiums paid. The plan is without any life cover. After maturity, one-third of the corpus can be withdrawn as a lump sum amount and the remaining two-thirds would be paid in either monthly or half-yearly installments after maturity, which would be decided by the policyholders.

Minimum Term:
The minimum term for the Pension Plus plan is 10 years.

Mode of Premium Payment:
Premiums can be paid yearly, half-yearly, quarterly, or monthly (through ECS mode only) or a single premium.

Premium Limit:
The minimum regular premium is Rs.15000 per annum (Except ECS Mode) while the maximum allowed for regular premium is Rs 1,00,000/-

For the ECS payment mode:
The minimum premium is Rs 1500 per month.

Single-Premium:
The minimum single premium is Rs.30000 and There is no limit on the Maximum one-time premium.

Top-up Premiums:
The top-up facility is available under the LIC Pension Plus plan which enables you to pay additional premiums in multiples of Rs 1000/- without any limit at any time, during the term of the policy.

Death Benefit:
The Policyholder’s Fund Value shall be payable either in a lump sum or as an annuity, as desired by the nominee.

Survival Benefits:
On surviving to the date of vesting, the higher of Policyholder’s Fund Value or Guaranteed Maturity Amount.

Fund Type:
The Pension Plus plan is available in two options — Debt fund and Mixed fund.

1. Debt Fund: Not less than 60 percent of the corpus would be invested in government securities, and the remaining 40 percent would be invested in money market instruments.

2. Mixed Fund: Investment in government securities is not less than 45 percent, and 40 percent into money market instruments and 15-35 percent into equities.

Fund Switching:
Two free switches per policy year are allowed free of charge.

Eligibility  Conditions  And  Other  Restrictions for Pension Plus:

  1. a)  Minimum Entry Age – 18 years (last birthday)
    b)  Maximum Entry Age – 75 years (nearest birthday)
    c)  Minimum Vesting Age  – 40 years (completed)
    d)  Maximum Vesting Age –  85 years (nearest birthday)
    f)  Sum Assured – NIL

Premium Allocation Charges:

  • For Single premium policies:  3.3%
  • For Regular Premium: First Year 6.75% 2nd to 5th Year 4.50% thereafter 2.50%
  • Allocation charge for Top-up: 1.25%

Update: LIC Pension Plus Plan No.803 Has Been Discontinued.


Note:
The above is the product summary giving the key features of the plan. This is for illustrative purposes only. This does not represent a contract and for details please refer to your policy document.

ULIP vs. Mutual fund

ULIP vs. Mutual fund

ULIPs and mutual funds are similar types of investments but not the same. As we know mutual funds are more into investments; whereas ULIPs are into investments as well as insurance. When we look into the basic concept the difference between the two is very small, and mainly consists of product structure and risk coverage.

The basic difference evolves regarding its regulation. The ULIPs are regulated by the IRDA, whereas mutual funds are regulated by the SEBI. Then the other important aspect is when we look from an industrial point of view, the main focus of mutual funds is on low costs while the main focus for the ULIPs lies in the better performance and the distribution of its products. The other aspect includes flexibility, in this case, a ULIP allows us to increase our life cover, and at the same time are premiums rates remain the same. This is achieved by reducing our investments. On the other hand, you don’t get any life cover in mutual funds. The only option we are left with is purchasing a new insurance policy which would ultimately lead to additional cost.

The other important point to be focused on involves that even if the costs of the investments in ULIPs are more compared to Mutual funds, the ULIPs offer better products that are suited for long-term investments, whereas mutual fund products can only be used for sole purposes or short term returns. And one more point which acts as a beneficiary in terms of insurance is, that we do not receive any insurance cover in mutual funds whereas we receive insurance cover in ULIP plans.

Mutual Funds and ULIPs both are subject to market risks; if something unfortunate happens to an investor, the family or nominee will receive only fund value. On the other hand, ULIPs will give your family a guaranteed sum assured in case of the death of the policyholder.

As these investments are the most preferred investment options to invest. even a small drawback somewhere makes a strong impression in our minds. So in the case of ULIPs vs Mutual funds, if we notice, ULIPs are more preferable even if both stand at the same level. Somewhere when we equate both the investment options ULIPs are more beneficial as well as flexible as per our requirements.

ULIP Insurance How it works?

ULIP Insurance How it works?

What is ULIP Insurance? How does it work?

ULIP is a part linked with the insurance plan. In other words, ULIP is an Insurance + Investment plan. ULIPs fall in the category where they are more goal-oriented and give priority to the safety of insurance protection. This plan enables you to secure protection for your family in the event of your untimely death and at the same time provides you an opportunity to earn a return on your premium paid. In this type of investment, a part of the investment is used for providing you life cover. As this insurance is combined is somewhere linked with investment, therefore the funds which are saved in turn are used in stocks or bonds, hence the value of the investment keep varying as per the investment chosen by you. In Simple words, ULIPs are structured in such a form that they can be managed according to the specific needs of the consumers and the protection received is an added benefit. In this way, the ULIPs offer flexibility to their customers.

There are certain important points to be taken into consideration before we opt for ULIP plans.

  • Firstly, we should be aware of all the charges ie. allocation charges, mortality charges, etc.
  • Secondly, a person can get a tax rebate of a maximum of Rs 100000 when invested in ULIP plans.
  • The third point is what are the locking period and other fine prints like surrender charges before maturity.

As now we know what exactly is a ULIP plan, now the next question that normally pops out in our minds is how does this plan work out? No plan is easy to understand, so in the same way, even it is critical to know the working of the ULIP plan and how our money gets invested. ULIPs basically works like a mutual fund with a life cover involved in it. The premium is invested by them in the investments like mutual funds, bonds, stock markets. When the amount of the premium is decided the insurer firstly deducts some portion of the ULIP premium and then the rest of the premium is invested in the funds. The next step involves the deduction of the mortality charges by the administration. The charges are deducted as per the type chosen by us. It may be on monthly basis or sometimes a daily basis. As the fund invested by us in the ULIP plan has an underlying value, the fund value provides us the value of the asset. And as the plan gets matured, we are entitled to receive the amount of our fund as per its face value.

The points must be considered and the proper knowledge of the ULIP plan is a must. If all these factors are viewed, this policy is very beneficial in the future.