LIC Jeevan Tarun Plan

Life Insurance Corporation of India (LIC) is owned by the Indian Government. LIC maintains top rank in the list of Indian Insurance Companies. The bill was passed in 1956 by the Parliament of India to form a Life Insurance Corporation under which more than 245 private companies were merged. It provides multitude of plans under different categories suitable for each individual. They have kept in mind every individual’s needs.

One such plan is LIC Jeevan Tarun. It is a money back plan specially designed for children.

How this Plan works

The policy premium term will be of your choice and as per your requirement. After deciding this you need to pay the premium for every term without failing and you will be eligible for a life cover called “Basic Sum Assured”. Under this plan every 5 years you will get some amount back till the time of maturity. This amount is decided based on our choice. If you opt for no money back, then you will get the full amount once the policy matures.

If you opt for 5% money back every 5 years, then you will get 75% of the sum assured amount once the policy matures. If you opt for 10% money back every 5 years, then you will get 50% of the sum assured amount once the policy matures. If you opt for 15% money back every 5 years, then you will get 25% of the sum assured amount once the policy matures. This product does provide the bonus. Along with this, you can also add “Accidental Death and Disability Rider” which you can buy giving an extra amount.

The Perks You Get Out Of This Plan

Death Benefit: Upon the death of the policyholder, this benefit is provided.

1. Before the date of commencement of risk:

In this case, the single premium is refunded to the nominee without giving any interest on the amount. This final premium amount does not include any extra amount or taxes.

2. After the date of Commencement of risk: In this case, Sum Assured on death is decided based on the single tabular premium. It is 10 times of the premiums. The premium paid during the decided tenure does not include any extra tax.

If all the regular premiums for decided term are paid with no balance premium, the Death benefit is calculated by adding following amounts:

Death Benefit = Sum Assured on death + Vested simple Reversionary Bonus + Final
 

Additional Bonus: The Sum Assured on death is relative to the Life Risk rates provided above. The final Death Benefit will never be less than 105% of all the premiums paid if the tenure of the policy is higher than 10 years. The premium paid during the decided tenure does not include any extra tax. The only extra amount needs to be paid is for Rider Premium, if applicable.

Maturity Benefit: Upon completing the tenure of the policy, maturity benefit is provided to the survivor. The key here is all the premiums should be paid for the entire term. The Maturity benefit is calculated as follows:

Maturity Benefit = Sum Assured on maturity + Vested simple Reversionary Bonus + Final Additional Bonus.

Here the Sum Assured on maturity is nothing but the amount deducted after calculating money back amount. This lump sum amount is paid on the maturity of the policy.

Profit of Participation: The policy should be eligible and it should incur profit for the Corporation, then the policy is entitled to Simple Reversionary Bonus. For this, the policy should be active and in force. The Reversionary bonus will be calculated based on the Basic Sum Assured.

Final Additional Bonus depends upon the year of policy maturity or the year in which it is claimed under Death of the policyholder.

Rider Benefit: This Accidental Death and Disability Benefit Rider can be added by the policyholder as an option. For this, the policyholder has to pay the extra cost along with the usual premium.

What is the Eligibility Criteria for LIC Jeevan Tarun Policy?

You can start the policy premium from 90 days until 12 years. The terms vary depending on the age of the policyholder. Age of policy maturity is 25-Age of the policyholder at an entry years. So at max, the policyholder will be about 25 years when the policy matures. Coverage provided by the policy plan starts from 75,000 INR till higher it can go.

Tax Benefit: Similar to other policy schemes, the LIC Jeevan Tarun Policy provides benefits in tax. The premiums are tax exempted Under the Section 80 C of Income Tax Act. The maturity amount provided at the end of Policy tenure is also tax-free. So you need not pay any tax on that amount. The maturity sum decided at the end will be given as it is. It is assured under the section 10 D.

Loan Facility: You can take a loan against the Jeevan Tarun policy in need. But for this the policy should be more than 3 months old or over the free look period. The amount of the loan is decided based on the age of the policyholder when the policy was started.

Policy Surrender: There is provision to surrender the policy in need. If the policy is surrendered within one year of policy opening, then the policyholder will get up to 70% of single premium paid. After completing one year, if the holder surrenders the policy, then he will get up to 90% returns on the single premium paid. There are many calculators available online to calculate the estimate of surrender policy. If the policy is surrendered after completing five years, then holder is also eligible for Loyalty Bonus along with the premium returns. This can be calculated using online calculators.

This policy can be brought by the parents or grandparents of the child. It will be beneficial for your child for their education or you can also take the benefit for their marriages.