916

Ever come across a large pile of banknotes? You know, by winning the lottery or hitting the jackpot at your favourite casino? Your first instinct must have been to buy a Porsche (that can’t really show its true skills owing to the Indian roads and the traffic) or to buy a house that could, possibly, contest for winning the show – MTV Cribs.

But, instead of dwelling on utopia, wouldn’t it be more prudent to consider your immediate surroundings? For example, your mother who loves to have you around just to start a bit of friendly banter or your younger brother who aspires to get into Yale but spends his weekends watching Gossip Girl.

Feeling a little less reckless, aren’t we? The new LIC Bima Bachat Plan (Plan No: 916) is for all those people who would prefer security over spending. It is a single premium participating endowment policy, that is, it is the traditional cash back plan with scheduled payments coupled with the return of the entire premium in addition to loyalty points given at the completion of policy tenure.

Some rules that all policyholders must abide by:

• LIC New Bima Bachat policy attains maturity when the investor turns 75 years of age.

• There are three choices of policy term offered to the investor depending on their age and requirements – 9, 12 and 15 years, among which the applicant must choose at the time of application.

• The minimum sum assured varies as the term of the policy. For nine years’ term, a minimum of Rs 35000 must be insured, whereas, for 12 years’ and 15 years’ terms, Rs 50000 and Rs 70000 are the minimum amount of premiums required, respectively.

• Also, the applicant must keep in mind that the amount assured must be a multiple of Rs 5000.

• To make things easier, the LIC Bima Bachat Plan requires a single premium only.

Want to know what you’re getting into with this insurance policy? After all, not every life insurance plan is synonymous with each other. Take a look at the features that this policy entails:

• It is a single premium cash back plan, that is, the lump sum of money is invested in the policy in return for a death benefit.

• The loyalty addition promised is payable upon maturation of policy or on earlier demise.

• 15% of the sum assured is returned after three years as a survival benefit (will be elaborated later).

• Discount is provided on the higher sum assured.

• Surrender Benefit or Policy Termination: Within the first year of the policy term’s commencement, if the applicant withdraws, 70% of the single premium is returned excluding taxes. If one retreats after the 2nd year launches, then 90% of the single premium is returned.

• If the policy seems unapproachable for you, the option of cancelling the LIC New Bima Bachat Plan within 15 days rests with you.

What’s so tempting about this policy? Why should you revoke your desire to spend all your money in one go and become a dull person investing in policies? Read on to find out.

Survival Benefit:

Mentioned earlier under the key details of this policy, this clause under the LIC Bima Bachat Plan ensures that, on survival, 15% of the sum assured is rewarded to the policyholder and the policy resumes:

For Policy Term Of 9 Years:

• To be paid at the termination of 3rd year

• To be paid at the termination of 6th year.

For Policy Term Of 12 Years:

• To be paid at the termination of 3rd year

• To be paid at the termination of 6th year.

• To be paid at the termination of 9th year.

For Policy Term Of 15 Years:

• To be paid at the termination of 3rd year

• To be paid at the termination of 6th year.

• To be paid at the termination of 9th year.

• To be paid at the termination of 12th year.

Loyalty Addition:

After the completion of 5 years since the commencement of the policy term, LIC Bima Bachat Plan announces loyalty points’ addition.

Maturity Benefit:

If the investor survives the entire policy tenure, the entire premium submitted at the beginning of policy term along with the loyalty addition will be returned.

Death Benefit:

If the insured person dies before the conclusion of the policy period, the following events can occur under the LIC Bima Bachat Plan:

1. If the policyholder dies before the end of 5 years of the policy tenure, then only the sum assured is returned to the nominee.

2. If the policyholder dies after the completion of 5 years of the policy tenure, then only the sum assured along with the loyalty addition (if any) is returned to the nominee..

3. As mentioned previously, there is a rebate available for high sum assured.

4. As per section 80C, income tax is excused for the premium paid and on the claims received, according to the Income Tax Act.

There are a few honourable mentions, when it comes to the prime benefits of the LIC Bima Bachat Plan, making it one of the most sought after life insurance policies. Loans can be availed against 60% of the surrender value, under this life insurance plan.

If the policyholder’s death results due to suicide within a year of the policy tenure, only 90% of the sum assured is returned to the nominee.

This is an offline plan, so you will have to contact the company’s executives or visit the company branches. Also, it can be bought through agents, brokers or other company mediators.

You can’t go to a company and claim any life insurance plan without a few identity proofs. So, here’s what you need to carry for a smooth encounter with the company executives while buying the LIC New Bima Bachat Plan:

• Cheque for the Single premium

• Address proof

• Know Your Customer Documents

• A passport sized photograph

• Date of Birth proof

• Identity proof

• Income proof

• Application Form filled in with correct medical history and attested

• Medical examination (may be necessary based on the applicant’s age and the sum assured)