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LIC Bima Account 1 Policy

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This plan has been withdrawn by the insurance company and is no longer available for sale.

LIC Bima Account 1 Policy 

Bima Account 1 from LIC is a traditional non-linked life insurance plan. It scores very high on simplicity and transparency and is the first time that a life insurance company is sharing the charges and commissions being deducted in a traditional plan. The plan also gives an assured return of 6% of the total amount in the policy holder’s every year. The policy may get returns more than this depending on the performance of the plan. The mortality rates too are on the lower side. The policy term can only be 5 to 7 years though and there is a cap of Rs.14,000 on the annual premium. You have LIC Bima Account 2 with higher term of 15 years.

 

Key Features of LIC Bima Account 1

  • Guarantees a minimum return of 6% of the entire money held in the policy holder’s account
  • Based on the performance additional bonuses may be declared
  • No medical examination
  • Transparent display of charges, which are on the lower side
     

 

COMPARE THIS PLAN WITH OTHER ENDOWMENT PLANS

 

Benefits you get from LIC Bima Account 1

Death Benefit – In case of death of the policy holder, the nominee would receive the Sum Assured + the amount in the policy holders account (net of premiums paid + assured returns + any additions).

Maturity Benefit – On maturity the policy holder would get the amount in the policy holder’s account (net of premiums paid + assured returns + any additions).

Income Tax Benefit - Premiums paid towards Life Insurance policies up to Rs. 1,00,000 are allowed as a deduction from the taxable income each year under section 80C. The maturity amount too is tax free.

 

Eligibility conditions in LIC Bima Account 1 Plan

 

 

Minimum

Maximum

Sum Assured (in Rs.)

10 x Annualised Premium

For age <= 35

20 x Annualised Premium

For age 36 to 45

14 x Annualised Premium

For age 46 to 50

10 x Annualised Premium

Policy Term (in years)

5

7

Premium Payment Term (in years)

Same as policy term

Annual Premium

Rs.7,000

Rs.14,000

Top Up Premium

-

Sum of all regular premiums paid

Entry Age of Policyholder

11

50

Age at Maturity

18

57

Lock in period

3 years

Single premium

NA

NA

Payment modes

Yearly, Half-Yearly, Quarterly and Monthly (ECS)

 

Charges in LIC Bima Account 1

 Expense Charges (which includes the commission charge paid to agents)

 

1st Year

2nd & 3rd year

4th to 7th Year

For regular Premiums

27.5%

7.5%

5%

Top Up Premiums

2.5% of the top-up amount

 

Mortality Charges (for every Rs.1000 of Sum Assured)

 

Entry Age

Upto 20 years

20 to 30 years

30 to 40 years

40 to 50 years

Per Rs. 1000 of  SA

1.25

1.46

2.57

6.56

 

Sample illustration of premium amount in LIC Bima Account 1

Age = 35 years

Policy Term = 7 years

Annual Premium = Rs.10,000

Total Premiums paid in 7 years = Rs.70,000

Returns on LIC Bima Account 1

 

Additional Features and Benefits of LIC Bima Account 1 Policy 

Guaranteed Returns – In Bima Account 1, there is a guaranteed return of 6% of the money held in the policy holder’s account. The policy holder’s account consists of all premiums paid net of charges  along with the guaranteed interest earned every year + any additional interest earned.

Additional Interest – Based on the performance of the policy an additional interest may be declared every year.

Top Up – You can top up your policy to an amount equal to the sum of all regular premiums paid. This can be done only after the 1st policy year. There is no increase in the Sum Assured based on the top-up paid and it does not form part of the policy holder’s account. So the guaranteed 6% returns would not apply to the Top-Up amount paid.

Loan facility – Loan can be availed in the Bima Account 1. The maximum loan amount would be 60% of the amount held in the policy holder’s account. If at any moment the loan amount outstanding along with the interest exceeds the policy holders account, the policy would be terminated and nothing would be payable to the customer.

Surrender Benefits – The policy would acquire surrender benefits as soon as the 1st year’s premiums have been paid. The benefits are payable only after 3 years though. If you surrender the policy before paying 3 years of premium, no additional charge would be levied on the account and no credit also would be credited to the account. If you surrender after paying premiums of 3 years, the amount held in the policy holder’s account would be payable.

Non-payment of Premiums – You policy would acquire a paid-up value if the premiums are no paid within the grace period. The policy can be revived within 12 months from the date of the 1st unpaid premium. No life cover is provided during the revival period. The amount in the policy would continue to earn a 5% interest till it is revived.

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