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LIC New Endowment Plus Plan
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LIC New Endowment Plus Plan - Table No. 835
LIC’s New Endowment Plus Plan is a unit-linked insurance plan popularly called as ULIPs. The New Endowment Plus is a blend of insurance and investment. In this plan, premium needs to be paid for the entire policy term. You can invest your money in a choice of 4 funds as per the your risk appetite. The Fund Value is paid on policy maturity as Maturity Benefit to the policyholder.
Launch Date
19th August, 2015
Plan Details
Table No. 835
Policy Type
ULIP
Key Features of LIC New Endowment Plus
It is a Unit-linked endowment insurance plan
Choice of 4 investment fund options
Free fund switches
Income Tax Benefit under Sections 80C & 10 (10D)
How does the LIC New Endowment Plan work?
The premium paid by you is invested into the 4 Funds of your choice. The details of the Fund Options are mentioned later in this page. You will receive Units of the Funds. The value of funds will be determined by the NAV of funds which keeps changing on a daily basis depending on how they are invested. The Units x NAV of the funds you hold gives you the Fund Value of your investments on a daily basis. There are a list of charges which are applicable in this plan - details will be explained in the “Charges” section later in this article.
Benefits in the LIC New Endowment Plus Policy
Death Benefit
If the Life Insured dies, before the Risk commencement date: the Fund Value is paid to the nominee.
If the Life Insured dies, after the Risk commencement date: an amount equal to the higher of the following is paid out:
10 times the Annualized Premium
105% of the total premiums paid
Fund Value
Risk Commencement Date
In case the age of the policyholder is less than 8 years at the time of taking the policy - The risk cover benefits will start one day before the completion of 2 years from the policy start date OR one day before the policy anniversary after the policyholder becomes 8 years old, whichever is earlier.
In case the age of the policyholder is 8 years or more - The risk cover starts immediately.
For better understanding, we have used some examples for the Risk Commencement Date in LIC New Endowment Plus Plan.
Maturity Benefit
When the policy matures, the Fund Value is paid to the policyholder as Maturity Benefit.
COMPARE THIS PLAN WITH OTHER ULIP PLANS
Eligibility Conditions in LIC New Endowment Plus Policy
At least 60% in Government Guaranteed Securities & Corporate Debt.
Rest in other money market instruments and listed shares
Secured Fund
Low to Medium Risk - Steady Income
At least 45% in Government Guaranteed Securities & Corporate Debt.
Rest in other money market instruments and listed shares
Balanced Fund
Medium Risk - Balanced Income & Growth
At least 30% in Government Guaranteed Securities & Corporate Debt.
Rest in other money market instruments and listed shares
Growth Fund
High Risk - Long term Capital Growth
At least 20% in Government Guaranteed Securities & Corporate Debt.
Rest in other money market instruments and listed shares
The Daily NAVs of these funds are mentioned in the links at the end. You can track how your funds are performing on a daily basis.
Switching
There are 4 free switches allowed in each policy year beyond which there is a charge of Rs. 100 applicable to each switch. Switching is basically moving your investments from one fund to another. In case you want to change the Fund Options you had earlier decided, you can do the Switch
Partial Withdrawal
Partial withdrawal is allowed after the 5th policy anniversary. Partial withdrawal shall be allowed subject to maintaining a minimum balance of:
From 6th to 10th policy year: 3 annualized premiums or 50% of Policyholders' Fund Value, whichever is higher
From 11th to 20th policy year: 3 annualized premiums or 25% of Policyholders' Fund Value, whichever is higher
Riders
Accidental Death Benefit Rider is available in this plan on payment of extra premiums.
Top-up
Top Ups are not allowed in this plan.
Free look Period
if the policyholder is not convinced with the terms and conditions of the policy, s/he can cancel the policy within 15 days from the receipt of the policy document.
Charges in the LIC New Endowment Plus Plan
Premium Allocation Charge
Every time you pay your premiums, this amount is deducted from it before it is invested in the Funds of your choice.
Policy Year
Charge
1st
7.5% of premiums
2nd to 5th
5% of premiums
6th onwards
3% of premiums
We now have plans with ZERO Premium Allocation Charges. Click to Compare ULIPs.
Policy Administration Charge
This is the charge for the administrative working of the policy and is deducted by cancellation of units on a monthly basis. The rates mentioned here are for Annual premiums - in case of other modes of premium payments, the charges are marginally higher.
Policy Year
Charge
1st year
Lower of Rs. 100 or (0.35% x Premium)
2nd year
Lower of Rs. 70 or (0.25% x Premium)
3rd year
2nd year charge x 1.03
4th year
3rd year charge x 1.03
5th year
4th year charge x 1.03
6th year onwards
Rs. 52.17 in 6th, increasing by 3% annually
In case of modes of payment other than Annual, the following Factor needs to be multiplied to the Annual Mode charges shown above.
Mode of Payment
Factor
Half yearly
1.6
Quarterly
2.6
Monthly
7
Fund Management Charge
This is deducted daily as a percentage of the Fund Value. So the NAV reported for the day will be net-off this charge
Fund Type
Charge
Bond, Secured, Balanced & Growth
0.7% per annum
Discontinued Policy Fund
0.5% per annum
Discontinuation Charge
In the event that you discontinue your plan before the end of the policy term, this charge will be applicable. This is charged by deducting the units which you hold.
Year of Discontinuation
Annual premium <= Rs. 25,000 per annum
Annual premium > Rs. 25,000 per annum
1st
Lower of 15% of (Annual Premium or Fund Value) subject to a maximum of Rs. 2,500
Lower of 6% of (Annual Premium or Fund Value) subject to a maximum of Rs. 6,000
2nd
Lower of 7.5% of (Annual Premium or Fund Value) subject to a maximum of Rs. 1,750
Lower of 4% of (Annual Premium or Fund Value) subject to a maximum of Rs. 5,000
3rd
Lower of 5% of (Annual Premium or Fund Value) subject to a maximum of Rs. 1,250
Lower of 3% of (Annual Premium or Fund Value) subject to a maximum of Rs. 4,000
4th
Lower of 3% of (Annual Premium or Fund Value) subject to a maximum of Rs. 750
Lower of 2% of (Annual Premium or Fund Value) subject to a maximum of Rs. 2,000
5th onwards
Nil
What happens if...
You stop paying the premium before 5 years – the policyholder has the following options:
Pay the due premium(s) within the 30 days from the due date - benefits under the policy shall continue
Revive the policy at any time within a revival period of two years from the date of discontinuance - Fund Value after deducting the Discontinuance Charge, if any, shall be transferred to the Discontinued Policy Fund.
Complete withdrawal from the policy without any risk cover: The fund value will be paid after 5 years.
You stop paying the premium after 5 years - the policyholder has the following options:
Pay the due premium(s) within the 30 days from the due date - benefits under the policy shall continue.
Revive the policy at any time within a period of two years from the date of discontinuance or up to the date of maturity, whichever is earlier
Complete withdrawal from the policy without any risk cover - the policy shall be terminated on the date of intimation for complete withdrawal and the balance amount in the Policyholder's Fund shall be refunded.
Convert the policy into paid-up policy - Policy will be treated as paid-up policy and no premiums shall be payable thereafter.
You want to surrender the policy – If the policy is surrendered on or before the expiry of the 5 years' lock-in period, then the Policyholder's Fund Value after deducting the Discontinuance Charges, if any, shall be transferred to the Discontinued Policy Fund and the amount shall be paid after 5 years. If the policy is surrendered after the expiry of 5 years' lock-in-period, then the fund value is paid immediately.
You want a loan against your policy - There is no loan available under this plan.
Other Features of the LIC New Endowment Plus Plan
Free-look Period – If the policyholder is not happy with the plan, he can cancel the policy within 15 days of receiving the policy documents. This period is called the free-look period. Upon cancellation, the premium paid, net of any applicable expenses would be returned.
Grace Period - In case of Yearly, Half-yearly and Quarterly premium payment mode you have a grace period of 30 days from the premium due date.
Surrender Value - This plan does not acquire any surrender value at any point of time.
If you have any questions on the LIC New Endowment Plus Policy, drop in a line in the comments and we will be happy to help out.
