LIC Jeevan Utkarsh Plan

LIC Jeevan Utkarsh (Plan 846)

LIC Jeevan Utkarsh (Table No. 846) is a single premium with 12 years fixed maturity term, Loyalty Addition (with profit) based and non-linked (not share market dependent) life insurance plan. On completion of 12 years term, maturity will be Sum Assured + Loyalty Addition (LA) and in case of death during the policy term, 10 times single premium (excluding rider premium and GST) + Loyalty Addition (LA) (if any) will be death claim amount. This plan also comes with a feature of settlement option with 5, 10 or 15 years settlement period, so if policyholder does not want to receive maturity or death claim amount in one go, then he/she can opt for equated amount over a period of 5, 10 or 15 years. Premium, Maturity and risk covers have been explained with the help of an in the later part of this article.

Key Features

  • High Risk Cover (10 times of Single Premium)
  • 5,10 or 15 years settlement option
  • Premium paid is eligible for rebate under 80(C)
  • Maturity amount will be tax free under 10(10D)

Plan Parameters

Age at Entry6 Years (Completed)
Maximum Age at Entry47 (Nearest Birthday)
Premium Paying ModeOne Time (Single Premium)
Policy Term12 Years
Sum Assured75,000 and above
Surrender70% of Single Premium in 1st Policy Year¬
90% of Single Premium from 2nd Policy Year
LoanCan be Availed after 3 Months

Maturity Benefits

  • On survival of policy holder i.e. completion of 12 year term, maturity will be¬ Sum Assured¬†+¬ Loyalty Addition.

Death benefits

  • On death during¬ First Five Years¬†of the policy:
    • If Death happens¬ before 8 years of Age, then death claim amount will be single premium (excluding Rider premium and GST) without any interest.
    • If Death happens¬ after 8 years of age, then death claim amount will be 10 times of single premium paid (excluding Rider premium and GST).
  • On death after 5 years of the policy and before maturity:
    • Death Claim amount will be 10 times of single premium paid (excluding Rider premium and GST) + Loyalty Addition.

Note:¬ 8 Years is minimum age of risk commencement under this policy and Loyalty Addition is applicable only after 5 years of successful policy term.

Jeevan Utkarsh Policy (846) with an Example

Let’s take and example of Jeevan Utkarsh policy with following details.

Purchase Year2017
Age25 Years
Basic Sum Assured5,00,000
Premium Paying Term1
Policy Term12
Premium of Basic Plan (without GST)2,62,450
Premium of Basic Plan with AD & DB Rider (without GST)2,67,000

Accidental Benefit & Disability Benefit (AD & DB) rider has been included in above example

Case:1 (Maturity Details)

If Policy holder survives 12 years, then Maturity (Sum Assured + Loyalty Addition) will be as under.

Maturity YearAge at MaturityTotal Maturity
202937500000 + Loyalty Addition (LA)

Case:2 (Death Before 12 Years)

In case of death, during policy term and before date of maturity, 10 times of single premium paid (excluding GST) + Loyalty Addition will be death claim amount.

Understanding Following Table: Suppose if Death happens in Year 2023, then nominee will get death claim amount as 10 times of single premium i.e. 2624500 + Loyalty Addition (LA) of year 2023 in case of normal death and in case of accidental death, an additional amount eqaul to sum assured (50000) will also paid along with normal death claim.

YearAgePremium
(Without GST)
Normal Life CoverAccidental Life CoverReturn

 

 

2017

25267000262450031245000
2018260262450031245000
2019270262450031245000
2020280262450031245000
2021290262450031245000
20223002624500 + LA3124500 + LA0
20233102624500 + LA3124500 + LA0
20243202624500 + LA3124500 + LA0
20253302624500 + LA3124500 + LA0
20263402624500 + LA3124500 + LA0
20273502624500 + LA3124500 + LA0
20283602624500 + LA3124500 + LA0
202937Maturity

500000 + LA

LIC Jeevan Utkarsh Plan Example

Let us understand this plan better with the help of an example.
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Suppose Diwakar buys this plan with the following parameters:
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Age – 30 years
Basic Sum Assured – Rs. 3,00,000
Policy Term = 12 years
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So the Single premium will be Rs. would be Rs. 1,62,405 + Taxes.¬
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Scenario 1Diwakar dies after 3 years of buying the plan.
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Since Diwakar died within 5 years of buying the plan, the Death Benefit paid to the nominee would be the higher of the following:
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  • 125% of the Single Premium = Rs. 2,03,006
  • Basic Sum Assured = Rs. 3,00,000
  • 10 times the Tabulated Single Premium = Rs. 16,24,050
So the nominee will get Rs. 16,24,050 as Death Benefit and the policy terminates.

Scenario 2 РDiwakar dies after 7 years of buying the plan.

Since Diwakar died after 5 years of buying the plan, the Death Benefit paid to the nominee would be the higher of the following:

Death Benefit – Nominee gets higher of the following:

  • 125% of the Single Premium = Rs. 2,03,006 + Loyalty Additions
  • Basic Sum Assured = Rs. 3,00,000 + Loyalty Additions
  • 10 times the Tabulated Single Premium = Rs. 16,24,050 + Loyalty Additions
So the nominee will get Rs. 16,24,050 + Loyalty Additions as Death Benefit and the policy terminates. Loyalty Additions will only be known as and when LIC declares the same.

Scenario 3 РDiwakar dies after 11 years of buying the plan.

Since Diwakar died after 5 years of buying the plan, the Death Benefit paid to the nominee would be the higher of the following:

Death Benefit – Nominee gets higher of the following:

  • 125% of the Single Premium = Rs. 2,03,006 + Loyalty Additions
  • Basic Sum Assured = Rs. 3,00,000 + Loyalty Additions
  • 10 times the Tabulated Single Premium = Rs. 16,24,050 + Loyalty Additions
So the nominee will get Rs. 16,24,050 + Loyalty Additions as Death Benefit and the policy terminates. Loyalty Additions will only be known as and when LIC declares the same.

Scenario 4 – Diwakar survives the policy term of 12 years.

Diwakar will get the Maturity Benefit.

Maturity Benefit = Basic Sum Assured + Loyalty Additions = Rs. 3,00,000 + Loyalty Additions. Loyalty Additions will only be known as and when LIC declares the same.

Other Benefits in LIC Jeevan Utkarsh Plan

Surrendering LIC Jeevan Utkarsh Plan
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Since this is a single premium plan, it will have a Surrender Value from the 1st year itself. Of course you stand to lose some part of your money invested in case you surrender the plan.
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  • Surrender Value of Jeevan Utkarsh plan in the 1st year – 70% of Single Premium Paid
  • Surrender Value of Jeevan Utkarsh plan anytime after the 1st year – 90% of Single Premium Paid
The surrender value does not include any premium on account of any underwriting decision or riders. Taxes paid are also not included in the surrender value calculation.
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You may get a Special Surrender Value in this plan which will depend on the LIC calculations which may change from time to time.¬
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Loan against your LIC Jeevan Utkarsh Plan
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  • You can avail a loan after 3 months of issuance of the policy.¬
  • The maximum loan value will be 90% of the Surrender Value
  • The interest rate on the loan will 10% per annum compounded half yearly. The interest rate if for the financial year 2017-18. It is subject to change.
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