LIC Jeevan Azad is a new saving cum life insurance plan launched by LIC of India ahead of republic day 26th Jan 2023. LIC Jeevan Azad is a Non-Linked, Non-Participating, Individual, Savings, Life Insurance Plan.
This is a Limited Premium Endowment plan under which the Premium Payment Term (PPT) is equal to Policy Term minus 8 years. It offers financial support for the family in case of unfortunate death of the life assured during the policy term and also takes care of liquidity needs through a loan facility. It also provides a guaranteed lump sum amount to the surviving life assured on the date of maturity.
This plan can be purchased online as well as offline. This plan is marketed as Freedom from stress Glory of Happiness. Let’s explore further details and review LIC Jeevan Azad Plan No 868.
LIC Jeevan Azad Plan No. 868 – Eligibility and Benefits
Minimum Basic Sum Assured: ₹ 2,00,000
Maximum Basic Sum Assured: ₹ 5,00,000
Basic Sum Assured shall be in multiples of ₹ 25,000/-
Minimum age at Entry: 90 Days Completed
Maximum age at Entry: 50 years
Minimum Maturity Age: 18 years completed
Maximum Maturity Age: 70 years
Policy Term: 15 to 20 years
Premium Paying Term: Policy Term minus 8 years
Minimum Basic Sum Assured per life* – ₹ 2,00,000/-
Maximum Basic Sum Assured per life* – ₹ 5,00,000/-
On Life Assured surviving the stipulated Date of Maturity, ’Sum Assured on Maturity’ which is equal to ‘Basic Sum Assured’ shall be payable.
The death benefit payable on the death of the life assured during the policy term after the date of commencement of risk but before the date of maturity, shall be “Sum Assured on Death” where “Sum Assured on Death” is defined as higher of ‘Basic Sum Assured’ or ‘7 times of Annualized Premium’.
This Death Benefit shall not be less than 105% of “Total Premiums Paid” up to the date of death.
However, in case of minor Life Assured, whose age at entry is below 8 years, on death before the commencement of Risk (as specified in Para 2 below), the Death Benefit payable shall be a refund of premium(s) paid (excluding taxes, extra premium, and rider premium(s), if any), without interest.
LIC Jeevan Azad Plan No. 868 – Review
To review LIC Jeevan Azad Plan first let’s take a look at the premium applicable to the policy. The annual Premium payable for Basic Sum Assured (BSA) of Rs. 2 lakhs for Standard lives for policies to be sold Offline is given below.
The above premiums are exclusive of taxes.
From the above table, we can see that for a 2 Lakh Sum assured premium amount to be paid is very high.
In addition to that you need to consider the following points before buying LIC Jeevan Azad Plan.
- An insurance policy is purchased to cover life risks. If we consider this plan as a pure life cover plan in that case the maximum sum assured offered under this plan 5 Lakh is very less. As a Death benefit, 5 Lakh is not enough for the family.
- If we consider this policy from an investment or saving point of view the return expected from this policy is 4-5% and post-tax this return would be still low.
- LIC is generally a launching policy at the end of December or starting of January and its prime purpose is to offer tax savings and nothing else.
In My opinion, you should not buy LIC Jeevan Azad policy Plan 868. Instead, purchase a good-term plan with high-risk coverage. In case your objective is tax saving go for ELSS or any other option.