LIC has launched 5 new plans in 2015. In this post I tried to list down the important features, details and my recommendations on ‘LIC 2015 new plans list’.
From January 2015 to December 2015, LIC has launched two Endowment plans, two Children’s Money Back Plans and one Unit Linked Insurance Plan (ULIP).
Before discussing more on these plans, let us understand what are endowment, money-back and ULIP plans.
What is an Endowment plan? – It is a combination of insurance and investment. The insured will get a lump sum along with bonuses (if any) on policy maturity or on death event.
What are Money-back policies? – They provides life coverage during the term of the policy and the maturity benefits are paid in installments by way of survival benefits.
A Unit Linked Insurance Plan (ULIP) is a product offered by insurance companies that, unlike a pure insurance policy, gives investors both insurance and investment under a single integrated plan. It is a long term investment cum protection plan for an individual.
LIC 2015 New Plans List – Latest LIC Plans Chart & Table
I have listed down the basic features of LIC of India’s new plans that are launched in 2015 along with my recommendations (whether to ignore a plan or to buy).
Latest LIC ‘s Endowment Plans 2015-16
- LIC Jeevan Sangam :
- Jeevan Sangam is a single premium endowment plan which was open for subscription for 90 days only. In this plan, the proposer can choose the Maturity Sum Assured (MSA). The single premium amount is based on the chosen MSA and the age of the life insured.
- Maturity Benefit = Maturity Sum Assured + Loyalty Addition
- This plan is now not open for purchase.
- The expected returns from Jeevan Sangam plan can be around 6 to 7%.
- For complete details on this plan, do read :” Jeevan Sangam plan – Features & Review “.
- LIC Jeevan Lakshya :
- Jeevan Lakshya plan is a Limited Premium Payment policy. It is a traditional endowment assurance plan.
- On survival of the policy holder till the end of the policy term, Maturity Amount = Sum Assured + vested Simple Revisionary bonuses + Final Additional bonus (FAB – if any) will be paid to the policyholder.
- Optional Accidental death & disability rider and Term assurance rider are available with this plan.
- The expected returns from LIC Jeevan Lakshya policy can be around 5 to 6%.
- For complete details on this plan, kindly read : “LIC’s Jeevan Lakshya : Features, Review & Returns Calculation“.
Latest LIC Child Money-back plans 2015-16
- LIC New Children’s Money Back Plan
- This money-back plan is a non-linked, with profits and regular premium payment policy. It is a savings cum protection plan.
- Under this plan, you (parent / guardian) are the proposer. Whereas, your kid’s life is covered. Your baby’s life is insured. I believe that this is a meaningless product.
- In this plan, in any unfortunate event, you (parent) will receive the death benefits. If kid survives till maturity, he/she will receive the money-back payments (survival benefits) at periodic intervals beginning from 18 years of child’s age.
- The expected returns from LIC’s New children money back plan can be around 4 to 6%.
- For complete details and why you should avoid Child plans like these, kindly read : “Why you should avoid LIC New Children’s Money Back Plan?“
- LIC Jeevan Tarun Child Plan
- This is an another child plan from LIC. It is a traditional, Non-linked, with-profits and Limited Premium Payment Option plan. It also has an optional Money back feature.
- In this plan too, the insured is kid and the proposer is parent.
- The expected returns from Jeevan Tarun plan can be around 4 to 6%.
- For complete details and why you should avoid Child plans like these, kindly read : “LIC Jeevan Tarun – Features & Review“.
LIC’s ULIP plan 2015
- LIC’s new ULIP plan – New Endowment Plus
- LIC’s New Endowment Plus is a unit linked assurance plan, which offers investment-cum-insurance during the term of the policy.
- Death Benefit in this policy is an amount equal to the higher of Basic Sum Assured or Policyholder’s Fund Value shall be payable.
- On Life Assured surviving the date of maturity provided the policy is in-force, an amount equal to Policyholder’s Fund Value shall be payable.
- This plan provides four FUND options (namely – bond, secured, balanced & growth funds). The returns from this policy will be dependent on the type of fund that is chosen by the policyholder.
- ULIPs can generate decent returns if held for long-term, say more than 10 years or till the maturity.
- For complete details, kindly read : “LIC New Endowment Plus plan – Features & Review“.
My opinion on LIC 2015 New Plans list
- If you have already bought any of the above traditional plans (endowment or child money-back plans), you can consider discontinuing them. You can let the policy lapse. This strategy is best suitable if you had paid premiums for only 1 or 2 policy years. The returns from traditional plans (endowment & money-back) can be very low. You may like reading my post on – “How to get rid off unwanted life insurance policy?“
- Kindly note that if you discontinue the policy then you will stand to lose the tax benefits availed in the previous year(s). But, this should not deter you to make these unwanted policies lapse.
- Kindly understand the importance of having adequate insurance cover. Traditional plans can neither provide you with adequate cover nor good returns. The returns from these kind of plans are mainly dependent on the BONUS RATES.
- You may buy a Term plan from LIC itself and invest the saved premium in other investment options (like mutual funds, bank fixed deposits etc., depending on your financial goals).
- LIC Jeevan Sangam is a single premium plan. That means you have paid the entire policy premium in one shot. You can consider surrendering it and re-invest this surrender value prudently. The surrender value shall be ;
- In first year: 70% of the Single premium paid excluding extra premiums paid and taxes, if any.
- Thereafter: 90% of the Single premium paid excluding extra premiums paid and taxes, if any.
- If you have bought LIC new endowment plus plan (ULIP plan), you may have to continue it till the maturity to get decent returns. Kindly note that ULIPs are long-term oriented products. But, I personally prefer investing in mutual funds to ULIPs.
- If you are planning to buy any of the above plans, you may ignore buying them. Especially child plans like ‘new children’s money back plan’ & ‘Jeevan Tarun’ defeat the whole purpose of insurance.
The psychological barrier of losing the money, is stopping many policyholders to exit from these kind of traditional policies. If you have already invested, it is better to exit from the unwanted policies instead of compounding the mistake.
What are your views on LIC 2015 New Plan list? Did you invest in any of the above plans? Kindly share your comments.
(Image courtesy of bplanet at FreeDigitalPhotos.net)