LIC Jeevan Utkarsh Plan

Summary of LIC Jeevan Utkarsh Plan – Table No. 846

LIC Jeevan Utkarsh Plan is a Single Premium Endowment Policy which offers a life cover of 10 times the single premium paid. This is a traditional participating plan which offers Loyalty Additions which will be available on maturity.

LIC Jeevan Utkarsh Policy is available for purchase only till 270 days from the launch date. The plan was officially launched on 6th September, 2017.

Loyalty Additions

Accidental Death

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Single Premium Endowment

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Key Features

Single Premium Endowment Plan with a fixed tenure of 12 years

Loyalty Additions to be paid at the end of the policy term

Option of selecting Accidental Death and Disability Rider along with the plan

Benefits

Death Benefit

1. If death occurs anytime during the first 5 policy years:

If the death of the policyholder happens before the Risk Commencement Date, nominee will receive the Single Premium paid without any interest.
In case of death of the Life Insured after the Risk Commencement Date, the Nominee would be paid the higher of the following:
- 125% of the Single Premium
- Basic Sum Assured
- 10 times the Tabulated Single Premium

2. In case of Death of the policyholder after 5 policy years, the nominee will be paid Loyalty Additions also. The nominee would receive the higher of the following:

125% of the Single Premium + Loyalty Additions
Basic Sum Assured + Loyalty Additions
10 times the Tabulated Single Premium + Loyalty Additions

Loyalty Additions will be applicable after 5 policy years and will be as decided and declared by LIC.

Maturity Benefit

On survival till the end of the policy term, the policyholder will get Basic Sum Assured + Loyalty Additions.

Income Tax Benefit - Very Important

As per the current income tax rules, Life Insurance premiums paid up to Rs. 1,50,000 are allowed as a deduction from the taxable income each year under section 80C. However the premium paid has to be lower than or equal to 10% of the Sum Assured for this to be applicable. This does not happen in this Single Premium plan.

Also the Maturity proceeds will be taxable under the current rules.

Read more on the Income Tax Rules for Life Insurance Plans.

Surrendering LIC Jeevan Utkarsh Plan

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.

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.

You may get a Special Surrender Value in this plan which will depend on the LIC calculations which may change from time to time.

Loan against your LIC Jeevan Utkarsh Plan

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.

Variants

	Minimum	Maximum
Sum Assured	Rs. 75,000	No limit
Policy Term	12 years
Premium Payment Term	Single Premium
Entry Age	6 years	47 years

How it works

Let us understand this plan better with the help of an example.

Suppose Diwakar buys this plan with the following parameters:

Age - 30 years

Basic Sum Assured - Rs. 3,00,000

Policy Term = 12 years

So the Single premium will be Rs. would be Rs. 1,62,405 + Taxes.

Scenario 1 - Diwakar dies after 3 years of buying the plan.

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

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 - Diwakar 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 - Diwakar 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.