LIC, one of the largest insurance companies in India is known for its range of insurance plans. They offer plenty of plans like endowment plans, pension plans, money back plans, whole life plans, and much more. Out of these, the endowment plan is one of the top preferred insurance plans offered by LIC. The endowment plan further comes with a multitude of options in its segment. We here have picked one such offering from LIC in form of a Single Premium Endowment Plan for today. Read along.
What is an Endowment Plan?
First things first, we need to know about endowment plans before learning more about LIC’s offering. Endowment plans are those insurance policies that provide the insurer with the cover against risk along with the guarantee of return. It can also be described as a form of a guaranteed corpus that a user can avail of at the end of the maturity period. If the insurer succumbs to untimely death before the maturity period, then his/her family shall be entitled to the policy amount.
LIC Single Premium Endowment Plan- An Overview
We all know how insurance policies work, you pay a premium based on the policy terms and in the end, you get a maturity amount. The premium can be paid yearly or in some cases at once in a single payment. This endowment plan from LIC works on a similar mechanism, it comes with a single one-time premium paying option. Hence the name LIC Single Premium Endowment Plan. The premium is paid at the starting of the policy.
This is one of the best insurance plans to opt for as it allows you the benefit of long term cover. With this plan you get a sum assured at the end of the maturity period. And if something happens to you, then this plan ensures that your family gets the amount. This way, you can protect your family against any future financial crisis. And there’s one more thing that is enticing about this insurance plan. A person can avail of tax benefits under the Income Tax Act.
Read More: LIC Customer Login Process at Online Portal
Key Highlights of LIC Single Premium Endowment Plan
Here are a few major features of this insurance plan:
- A single one-time lumpsum premium payment.
- This insurance policy can be taken by anyone between 90 days to 65 years of age.
- The term plan can be anywhere from 10 years to 25 years.
- One can choose a policy starting from a minimum of Rs 50,000.
- It comes with simple revisionary bonuses that are earned during the term of the insurance plan.
- At the end of the policy maturity or in cases of death, the insurer or their family will be provided with a bonus. A final additional bonus may also be added to the payable amount.
- LIC offers a discount on premium for a high level of coverage.
- It comes with a guaranteed surrender value if the insurer wants to exit before the completion of the period.
Eligibility of LIC Single Premium Endowment Policy
Here are the eligibility parameters for this insurance plan.
|Entry age||90 days to 65 years
|Minimum maturity age||18 years
|Maximum maturity age||75 years
|Policy term||10 years to 25 years
|Sum assured||Rs 50000 – No limit
|Premium paying mode
Benefits of LIC Single Premium Endowment Policy
There are a host of benefits that you can get with this single premium endowment policy. We’ll look to list them down below and further brief about them:
1. Maturity policy – Death Benefit
- If the insurer succumbs to untimely death before the maturity period of the insurance policy then his/her family shall be entitled to the claim. They will also be entitled to death benefits depending on the period of death of the person. There is a risk date associated with this policy and if the insurer dies in this period, then their family shall be paid an accrued bonus along with the sum assured. However, if the person dies before the start of risk cover, then only the insurance premium amount will be paid back to the family of the insurer.
2. Maturity policy- Survival benefit
- If the insurer survives till the end of the insurance policy period, then the insurer will be paid the sum assured along with a revisionary bonus and additional bonus. The revisionary bonus is calculated yearly as a percentage of the sum quoted.
3. Policy loan benefit
- LIC allows the insurer to avail the benefit of the policy loan if he has completed the first year of the policy. The amount offered under the loan shall be decided by LIC itself.
4. Tax benefit
- As part of the Government’s initiative to promote the concept of insurance and savings to people, they have offered the provision of tax benefits for insurers under this scheme. A person who pays a premium on this policy can avail of deduction under Section 80C of the Indian Tax Act, 1961. The limit for deduction is Rs 1.5 lakhs. Furthermore, any maturity benefits or death benefits that an insurer is entitled to will be completely tax-free in the hands of the insurer as under Section 10 (10D) of the Income Tax Act.
5. Discount on premium
- LIC also offers a discount on the premium payable if a person purchases a policy with a sum assured or Rs 1 lakh or more. The discount levels are mapped at the percentage of sum assured and can be seen down below here:
For an amount between Rs 1 lakhs to Rs 1.95 lakhs- 18% of the sum assured
For an amount between 2 lakhs to Rs 2.95 lakhs- 25% of the sum assured
For an amount between Rs 3 lakhs and above – 30% of the sum assured
6. Policy surrender benefits
- It also offers a guaranteed surrender value to the insurer in case of policy surrender. If a person is willing to end the policy before the end of the plan then they will receive the amount as stipulated down below:
During the first year- 70% of the premium along with vested bonuses till the date of surrender
After a first year- 90% of the premium amount along with vested bonuses till the date of surrender
How to Buy LIC Single Premium Endowment Plan?
This insurance plan is pretty impressive and is something that offers protection to you and your family without shedding loads of money from your pocket. You can buy this insurance plan via an insurance agent or through LIC’s branch offices. All you need to do is follow the procedure, i.e. fill the application and submit the required documents. (We’ll talk about the required documents down below in another segment)
You also need to submit the premium amount based on the sum assured as preferred by you. The company will further process the form and provide you with the insurance policy. Another way to buy this insurance plan is by going onto the website of LIC and buying it online. This will save you the hassle of office round-ups and waiting in the queue.
Required Documents for LIC Single Premium Endowment Plan Application
You’ll need to submit a few documents as mentioned down below in the list:
- Identity proof – Aadhar Card/ Voter ID card/ Passport/ PAN Card
- Address proof- Aadhar Card/ Ration Card/ Voter ID Card
- Age proof- Birth Certificate
- Proof of Income- Salary Slip/ ITR
- Photographs – Passport sized
- Application form
How to claim for the LIC Single Premium Endowment Plan?
It’s a pretty easy process to claim the sum assured from LIC. All you need to do is intimate the insurance company about the claim and provide the required documents for verification. Once the verification is done by the insurance company they will process your settlement and you’ll receive the sum assured along with bonuses as per details mentioned in the policy.