Here’s an overview of the all-new Bima Shree Plan launched by the Life Insurance Corporation of India (LIC).
The Life Insurance Corporation of India (LIC) is a government-owned insurance group and investment company. It is one of the largest insurance companies in the country. The company offers a range of insurance and investment products such as Insurance plans, pension plans, unit-linked plans and group schemes among others.
In March this year, the company added a new plan to its exhaustive bouquet of products. It’s the Bima Shree Plan. The insurance company defines it as a non-linked, with-profit, limited premium payment money back Life Insurance plan.
Before we delve into an overview of the plan, let’s try and understand the difference between a regular insurance policy and a money-back plan.
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Traditional Insurance Vs. Money Back Plan
A traditional insurance plan pays out the sum assured in the event of the death of the policyholder. The beneficiaries/dependants/nominees of the life insured receive a benefit (known as death benefit) if the worst should come to pass for the insurance holder.
A money-back insurance plan pays out the same maturity benefits in the form of several guaranteed ‘survival benefits’ which are staggered evenly throughout the course of the policy. So, a money-back insurance policy is an endowment plan with the benefit of regular liquidity.
Overview Of Bima Shree Plan (Plan no. 848)
By opting for this plan you give yourself and your family the double benefit of protection and savings. Wondering how? The plan secures the financial well-being of the policyholder’s family in both cases where the person survives the policy term or if the policyholder passes away before it. Other than the regular benefits of a Life Insurance policy, a Bima Shree Plan policyholder will also receive periodic payments at specified durations during the policy term and a lump sum amount at the time of maturity on survival. This is not all! The Bima Shree Plan will also look after the liquidity needs of you and your family through a loan facility.
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Interested? Let’s take a look at the eligibility requirements for this policy
|Minimum basic sum assured||Rs. 10,00,000|
|Maximum basic sum assured||No limit|
|*The basic sum assured shall be in multiples of Rs. 1,00,000|
|Policy term||14, 16, 18, and 20 years|
|Premium paying term||(Policy term – 4) years|
|Minimum age at entry||8 years (completed)|
|Maximum age at entry||55 years for a policy term of 14 years
51 years for 16 years policy term
48 years for 18 years policy term
45 years for a policy term of 20 years
|Maximum age at maturity||69 years for a policy term of 14 years
67 years for 16 years policy term
66 years for 18 years policy term
65 years for a policy term of 20 years
Now, let’s look at the benefits offered by the policy
- Death Benefit
|On death during first five years of the policy term||Sum of sum assured on death and accrued guaranteed addition|
|On death post five years of policy term but before maturity date||Sum assured on death + accrued guaranteed addition + loyalty addition, if any|
The sum payable on death will be the highest of 10 times of annualised premium, sum assured on maturity, or 125% of the basic sum assured. As per the policy, the death benefit will not be less than 105% of all the premiums paid as on date of death.
- Survival Benefit
These benefits are paid out to the policyholder at different periods of time as a certain percentage of the basic sum assured. Let’s look at the breakup.
|Policy Term||Survival Benefit|
|14||30% of basic sum assured on both 10th and 12th policy anniversary.|
|16||35% of basic sum assured on both 12th and 14th policy anniversary.|
|18||40% of basic sum assured on both 14th and 16th policy anniversary.|
|20||45% of basic sum assured on both 16th and 18th policy anniversary.|
- Maturity Benefits
All policyholders who survive the policy tenure will get maturity benefit which is equal to sum assured on maturity + accrued guaranteed additions + loyalty addition if any.
|Sum assured on maturity||Policy Term|
|40% of basic sum assured||14 years|
|30% of basic sum assured||16 years|
|20% of basic sum assured||18 years|
|10% of basic sum assured||20 years|
This is just an overview of the benefits offered by the Bima Shree Plan. Before buying an insurance policy of any kind, you must always read the offer document carefully. It will help you understand the finer details that can otherwise turn into roadblocks if missed. Hence it is best to get the information from the insurer before investing.
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Riders Available To Bolster Your Policy
Availing a separate rider with your insurance policy may marginally increase your insurance premium. The increase depends upon the type of rider availed by you. The best way to choose riders is to first determine your future financial needs and then zero in on the rider that suits your financial requirement the best. Different insurance providers offer different kinds of riders for various financial needs.
LIC provides five optional riders under its Bima Shree Plan of which a policyholder can choose four. The riders offered are:
- LIC’s accidental death and disability benefit rider
- LIC’s accident benefit rider
- LIC’s new term assurance rider
- LIC’s new critical illness benefit rider
- LIC’s premium waiver benefit rider
Apart from the above-mentioned benefits, LIC’s Bima Shree Plan offers the following:
- Option to defer the survival benefits(s) where a policyholder can get increased survival benefits. This is a combination of the original deferred benefit(s) plus interest.
- Settlement option for maturity benefit and death benefit where the policyholder can choose to receive the benefits in instalments over a period of 5, 10 or 15 years.
You can pay your premiums for Bima Shree Plan on a yearly, half-yearly, quarterly or monthly basis. The grace period available is 30 days for yearly, half-yearly and quarterly payments and 15 days for monthly payments.
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To get the tag of a paid-up policy, you must pay all your premiums for two years without a miss. In case you miss paying a premium on your policy before the completion of two years then your policy will cease to exist at the end ofthe grace period. However, not paying any premium after the two year mark will ensure that it is considered as a paid-up policy until the end of the policy tenure.
This was a broad overview of LIC’s Bima Shree Policy. If you are looking for Term Insurance we have plenty of offers to choose from. It’s best to compare across providers to find the most suitable one for you. Start exploring now.