LIC’s Jeevan Azad is a Non-Linked, Non-Participating, Individual, Savings plan. Jeevan Azad plan is basically a combination plan which provides protection and savings. This is a limited Premium Payment Endowment plan wherein the policyholder pays premium for a fixed period rather than the entire policy duration. On maturity the policyholder gets guaranteed lump sum amount.
This Plan can be purchased Offline through Licensed agents, Corporate agents, Brokers, Insurance Marketing Firms, Point of Sales Persons-Life Insurance (POSP-LI) / Common Public Service Centers (CPSC-SPV) as well as Online directly through website www.licindia.in.
Table of Contents
LIC Jeevan Azad ( 868)- Eligibility & features
- Choose choose policy term 15 -20 years
- Pay for term – 8 years. If the policy term is 20 year. You need to pay for 12 years only.
- At maturity you get sum assured
- Tax benefit on premium paid.
| Minimum Sum Assured (The Basic Sum Assured shall be in multiples of Rs. 25,000/-) | Rs. 2,00,000 |
| Maximum Sum Assured (The Basic Sum Assured shall be in multiples of Rs. 25,000/-) | Rs. 5,00,000 |
| Minimum Policy Term | 15 -20 years |
| Premium Paying Term | Policy term – 8 years |
| Minimum Age at entry | 90 days(completed) |
| Maximum Age at entry | 50 years (nearer birthday |
| Minimum Maturity Age | 18 years ( completed) |
| Maximum Maturity Age | 70 years (nearest birthday) |
Benefits under LIC New Jeevan Azad Policy
Maturity Benefit
On maturity of policy, basic Sum Assured is paid.
Death benefit
On Death during the policy term i.e. before the stipulated Date of Maturity
On death of the Life Assured (During policy term) the nominee will get higher of the following
- Basic Sum Assured on death
- or
- 7 times of annualised premium+ Simple reversionary Bonus + Final additional bonus
*At any point of time the death benefit will not be lower than 105% of total annual premium paid till date.
However, in case of minor Life Assured, whose age at entry is below 8 years, on death before the commencement of Risk , the Death Benefit payable shall be refund of premium paid (excluding taxes, extra premium and rider premium(s), if any), without interest.
Settlement Option ( for Maturity)
Under LIC settlement option, one can take maturity benefit in instalments over a period of 5 years instead of lump sum amount. This option can be exercised for in force or paid policies.
Please refer the below table for settlement option.
Settlement Option( Death Claim)
One can choose to receive death benefit in instalments over the chosen period of 5 years instead of lump sum amount.
The instalments shall be paid in advance at yearly or half-yearly or quarterly or monthly intervals, as opted for, subject to minimum instalment amount for
Different modes of payments being as under:
J
Jeevan Azad Death benefit Payout in instalments
Riders
The policyholder has an option of availing following Rider benefit(s):
- LIC’s Accidental Death and Disability Benefit Rider –In case of Accident death -Accidental death Sum Assured will be payable in lumpsum. In case of accidental disability arising due to accident (within 180 days from the date of accident), an
- LIC’s Accident Benefit Rider -In case of accidental death, the Accident Benefit Sum Assured will be payable in lump sum.
- LIC’s Premium Waiver Rider – If the Life Assured is a minor than premium waiver rider can be opted by the proposer.This rider option is available for minors only.
Rider sum assured cannot exceed the Basic Sum Assured.
Jeevan Azad ( 868) Premium & Return
Let’s calculate Jeevan Azad return. Please refer to the chart below taken from LIC Jeevan Azad brochure itself.
Here, we take example of a 40 year, takes a Jeevan Azad policy for 16 year policy term, in which the policyholder will pay for 8 years.
LIC Jeevan Azad Review
In my view, it’s not worth to waste your money, energy and time on such useless products. The return from the Azad policy is extremely low ( please refer table above).
Even it cannot beat the inflation rate. In fact, you are not gaining from the policy but you will be at a complete loss.
Instead, it is better to purchase a term insurance with higher cover and invest rest of money in some other instruments such as PPF, NSC, SSY, SCSS or PMVVY ( in name of a elderly person), POMIS for risk free safe returns.
If you can take mild to high risk than one can go for mutual funds or other investments.
In addition think of a situation of any mis -happening with the life assured. How long the family will survive with this 5 lac amount.
I strongly suggest not to get lured by low premium. However, if you find this much return and premium is justified for you. Then,You can buy LIC Jeevan Azad policy.
What if you do not pay Premium -(Paid-up)
The policy acquires a paid up value if you stop paying premium and the paid up value is given at the policy maturity date.
The paid up value depends on premium payment duration.The below mentioned policy paid up value is given.
If less than TWO years’ premiums have been paid
All the benefits under the policy shall cease after the expiry of grace period and nothing shall be payable.
If at least TWO full years’ premiums have been paid
The policy will acquire paid up value and it will be paid at maturity.
The Sum Assured on Maturity under a paid-up policy shall be reduced to a sum called “Maturity Paid-up Sum Assured” and shall be equal to
[(Number of premiums paid /Total number of premiums payable)*(Sum Assured on Maturity)].
Here, reversionary bonus and final additional bonus will also be paid.
After the expiry of Policy Term:
On death of the Life Assured after expiry of the policy term, Paid-up Sum Assured equal to Basic Sum Assured multiplied by the ratio of the total period for which premiums have already been paid bears to the maximum period for which premiums were originally payable shall be paid.
A paid-up policy shall not be entitled to participate in future profits. However, the vested Simple Reversionary Bonuses shall remain attached to the paid-up policy.
The Sum Assured on Death under a paid-up policy shall be reduced to a sum called “Death Paid-up Sum Assured” and shall be equal to
[(Number of premiums paid /Total number of premiums payable) * Sum Assured on Death]
Here, reversionary bonus and final additional bonus will also be paid.
For Example, if you paid premium for 3 years only and the policy premium paying term was 15 year than the paid up value will be
3/15* Sum Assured
Surrender Value:
The policy can be surrendered at any time provided premiums have been paid for at least two consecutive years.
On surrender of the policy, the Corporation shall pay the Surrender Value equal to the Guaranteed Surrender Value and Special Surrender Value.
The Special Surrender Value is reviewable and shall be determined by the Corporation from time to time subject to prior approval of IRDAI.
The Guaranteed Surrender Value payable during the policy term shall be equal to the total premiums paid multiplied by the Guaranteed Surrender Value factor applicable to total premiums paid. These Guaranteed Surrender Value factors expressed as percentages will depend on the policy term and policy year in which the policy is surrendered.
