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Deferment of Survival Benefits in LIC New Children’s Money Back Plan
Jul 05, 2017 | 331 VIEWS
You have an optional benefit of taking the Survival Benefits at a later point of time. Let us understand how this works with the help of an example.
 
Suppose Samik who was 5 years old had taken this plan. The Basic Sum Assured of the plan is Rs. 1,00,000. The survival benefits would be as follows:
 
  • After he attains the age of 18 years = 20 % of Basic Sum Assured = Rs. 20,000
  • After he attains the age of 20 years = 20 % of Basic Sum Assured = Rs. 20,000
  • After he attains the age of 22 years = 20 % of Basic Sum Assured = Rs. 20,000
 
Each of these benefits, he can choose to take anytime till he reaches the age of 25 (when the policy term end). 
 
If he chooses to take any of these at a later point of time, he would be eligible to a multiplication factor as shown in the table below.
 
n Factor n Factor n Factor
1 1.00450 29 1.13050 57 1.25650
2 1.00900 30 1.13500 58 1.26100
3 1.01350 31 1.13950 59 1.26550
4 1.01800 32 1.14400 60 1.27000
5 1.02250 33 1.14850 61 1.27450
6 1.02700 34 1.15300 62 1.27900
7 1.03150 35 1.15750 63 1.28350
8 1.03600 36 1.16200 64 1.28800
9 1.04050 37 1.16650 65 1.29250
10 1.04500 38 1.17100 66 1.29700
11 1.04950 39 1.17550 67 1.30150
12 1.05400 40 1.18000 68 1.30600
13 1.05850 41 1.18450 69 1.31050
14 1.06300 42 1.18900 70 1.31500
15 1.06750 43 1.19350 71 1.31950
16 1.07200 44 1.19800 72 1.32400
17 1.07650 45 1.20250 73 1.32850
18 1.08100 46 1.20700 74 1.33300
19 1.08550 47 1.21150 75 1.33750
20 1.09000 48 1.21600 76 1.34200
21 1.09450 49 1.22050 77 1.34650
22 1.09900 50 1.22500 78 1.35100
23 1.10350 51 1.22950 79 1.35550
24 1.10800 52 1.23400 80 1.36000
25 1.11250 53 1.23850 81 1.36450
26 1.11700 54 1.24300 82 1.36900
27 1.12150 55 1.24750 83 1.37350
28 1.12600 56 1.25200 84 1.37800
 
Where n= Number of completed months from due date of Survival Benefit to the actual date of Survival Benefit payment 

At the age of 18, he is eligible to get Rs. 20,000. 
 
Suppose he chooses to defer this payment by 42 months. He would be eligible to a factor of 1.1890. 
He would now get: Rs. 20,000 x 1.1890 = Rs. 23,780
 
Suppose he chooses to defer this payment by 52 months. He would be eligible to a factor of 1.2340. 
He would now get: Rs. 20,000 x 1.2340 = Rs. 24,680
 
Similarly, he could choose to defer any of the 3 Survival Benefit tranches till the end of the policy term and avail a higher payout. This could be useful to those who want a lumpsum payment at the end of the policy term.
 
Click here for a Understand the benefits of LIC New Children’s Money Back Plan.

Deepak Yohannan
Deepak Yohannan is the CEO of MyInsuranceClub. He enjoys writing on Personal Finance and contributes regularly on sites like Reuters & Moneycontrol. He is a strong proponent of online insurance and is often found pointlessly babbling about it!

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