LIC Jeevan Umang

LIC Jeevan Umang is a comprehensive, non-linked, endowment plan that provides financial protection against death throughout the policy term, along with the benefit of regular income after the selected premium paying term. The policy offers a combination of risk cover and long-term savings, making it ideal for those looking for a blend of life cover and guaranteed returns. It is particularly attractive to individuals seeking a steady income post-retirement or to meet future financial needs.

Key Features of LIC Jeevan Umang:

1. Type of Plan:
   • Non-Linked Endowment Plan with Risk Cover and Income Benefit.
   • It provides life insurance cover during the policy term and pays a lump sum (sum assured) along with bonuses on death or maturity.
   • The policy offers risk cover throughout the policy term, and after the premium paying term, it offers a steady income at regular intervals.
2. Policy Term:
   • The policy term is available in a range of 15 to 25 years.
   • You can choose the term according to your requirements and goals.
3. Premium Paying Term:
   • The premium paying term is limited. You pay premiums only for a selected period (usually for 15 years or 20 years), while the policy continues to provide coverage for a longer period (the total policy term).
4. Risk Cover:
   • The life cover (Sum Assured on Death) is provided for the entire policy term, ensuring financial protection for the policyholder’s family in case of premature death.
5. Survival Benefits (Income Benefit):
   • After the premium paying term, the policy starts paying a regular income (referred to as “Survival Benefits” or “Payouts”).
   • This regular income is paid annually for a period of 5 years and is equal to a percentage of the sum assured.
6. Sum Assured on Death:
   • In the event of death during the policy term, the nominee receives the sum assured on death, which includes the sum assured along with any bonuses accrued up to that point.
7. Maturity Benefit:
   • At the end of the policy term, if the policyholder survives, the policy will pay the sum assured on maturity, along with any bonuses accrued during the term.
   • Additionally, the income benefit that was paid regularly after the premium paying term is also provided.
8. Bonuses:
   • As a participating plan, LIC Jeevan Umang participates in LIC’s corporate life insurance business and is eligible for simple reversionary bonuses and final additional bonuses.
   • These bonuses increase the overall returns of the policy, which can be paid out at the time of maturity or death.
9. Loan Facility:
   • Policyholders can avail of loans against the policy’s surrender value if needed.
10. Tax Benefits:
    • The premiums paid towards the policy are eligible for tax deductions under Section 80C of the Income Tax Act.
    • The sum assured and bonuses received are tax-free under Section 10(10D) of the Income Tax Act, subject to applicable conditions.

Benefits of LIC Jeevan Umang:

1. Dual Benefit:
   • Provides life cover during the policy term and regular income after the premium paying term.
2. Regular Income:
   • Ideal for retirement planning or meeting long-term financial needs like children’s education, marriage, etc. The policy pays regular annual income after the premium paying term, making it a good option for financial security after retirement.
3. Lump Sum & Income:
   • Along with regular income, you also get a lump sum maturity benefit at the end of the policy term, which provides a financial cushion.
4. Participating Plan:
   • Being a participating policy, LIC Jeevan Umang allows the policyholder to participate in the corporation’s profits, thus receiving bonuses that enhance the returns from the policy.
5. Loan Facility:
   • The policy offers a loan facility once it has acquired a surrender value, giving policyholders access to funds in times of need.
6. Long-Term Financial Security:
   • It ensures long-term financial stability for both the policyholder (through income benefits) and the family (through death cover).
7. Tax-Free Returns:
   • The maturity benefit and death benefit are tax-free under Section 10(10D) of the Income Tax Act, which increases the policy’s overall value.

Eligibility Criteria:

• Minimum Age at Entry: 90 days (3 months)
• Maximum Age at Entry: 55 years (for a policy term of 25 years)
• Minimum Policy Term: 15 years
• Maximum Policy Term: 25 years
• Premium Paying Term: Limited (usually 15 or 20 years)
• Minimum Sum Assured: ₹2,00,000 (can go higher depending on your requirements)
• Maximum Sum Assured: No limit, subject to underwriting requirements.
• Premium Payment Modes: Annual, Semi-Annual, Quarterly, or Monthly (via ECS).

Example of LIC Jeevan Umang (Illustration):

Let’s consider a policyholder opting for a 20-year policy term and a premium paying term of 15 years with a sum assured of ₹10,00,000.

• The policyholder will pay premiums for 15 years.
• After the premium-paying term (15 years), the policy will start paying annual income (survival benefits) for the next 5 years, say ₹50,000 per year (depending on the sum assured).
• At the end of the 20-year policy term, the policyholder will receive a lump sum maturity benefit along with the survival benefits paid during the last 5 years.
• If the policyholder passes away during the term, the nominee will receive the sum assured on death, along with any accumulated bonuses.