Jeevan Suraksha is a Deferred Annuity plans from LIC that allows the policyholder to make provision for regular income after the selected term.
Features
•Premiums are payable yearly, half-yearly, quarterly, monthly or through Salary deductions throughout the term of the policy or till earlier death.
•Single premium option is also there, i.e. premium can be paid in one lump sum
•The premiums paid under New Jeevan Suraksha qualify for tax relief under Section 88.
•These are with-profit plans and participate in the profits of the Corporation’s annuity / pension business & policies get a share of the profits in the form of bonuses
•Simple Reversionary Bonuses are declared per thousand Sum Assured annually at the end of each financial year & they form part of the guaranteed benefits of the plan.
•Additional Bonuses may also be payable provided policy has run for a certain minimum period.
Benefits
Death Benefit:
On death of the Life Assured during the term of the policy the basic premiums paid, excluding any rider premiums or extra premiums, up to the date of death accumulated with interest at such rates as decided by the Corporation will be payable to the nominee. Currently, the interest rate is
3%, if the death occurs within the first 10 years
4%, if the death occurs within the first 20 years
5%, if the death occurs thereafter respectively.
Extra Benefits (optional)
An additional premium is required to be paid for these benefits.
Surrender Value
Surrender value is available on the plan on earlier termination of the contract.
Guaranteed Surrender Value
The policy may be surrendered after it has been in force for 2 years or more but before the vesting date. The guaranteed surrender value is 90% of the basic premiums paid excluding the first year’s premium. In case of a single premium policy the guaranteed surrender value is allowed after 2 years from the date of commencement of the policy.
Corporation’s policy on surrenders
In practice, the company will pay a Special Surrender Value – which is equal to or higher than the Guaranteed Surrender Value. The benefit payable on surrender reflects the discounted value of the reduced claim amount that would be payable on death or at maturity. This value will depend on the duration for which premiums have been paid and the policy duration at the date of surrender. In some circumstances, in case of early termination of the policy, the surrender value payable may be less than the total premium paid.
The Corporation reviews the surrender value payable under its plans from time to time depending on the economic environment, experience and other factors.