LIC (Life Insurance Corporation of India) offered various term insurance plans designed to provide financial protection to policyholders and their families. Term insurance is a type of life insurance that provides coverage for a specific term, and it pays a death benefit to the nominee in case the policyholder passes away during the policy term.
Here are some key features of LIC's term insurance plans:
Coverage Amount: LIC term insurance plans offer a sum assured or coverage amount that is paid to the nominee (the beneficiary) in the event of the policyholder's demise during the policy term.
Policy Term: LIC provides flexibility in choosing the policy term, which can range from 10 years to 35 years or more, depending on the specific plan.
Premium Payment Options: Policyholders can choose to pay premiums annually, semi-annually, quarterly, or monthly, depending on their convenience.
Rider Options: LIC typically offers optional riders that policyholders can add to their term insurance plans for additional coverage. Common riders include accidental death benefit, critical illness rider, and disability benefit rider.
Maturity Benefits: Term insurance plans are primarily designed for pure protection, meaning they do not offer any maturity benefits if the policyholder survives the policy term. However, some plans may offer a return of premium option where premiums paid are returned to the policyholder if they survive the term.
Entry Age: The minimum and maximum entry ages for LIC's term insurance plans vary depending on the specific plan. Generally, the entry age starts at 18 or 20 years and can extend up to 65 years or more.
Premium Rates: The premium amount for LIC's term insurance plans depends on factors such as the coverage amount, policy term, age, and health of the insured. Smokers and individuals with certain health conditions may have higher premiums.
Claim Settlement: LIC has a strong reputation for its efficient and reliable claim settlement process. In the unfortunate event of the policyholder's demise, LIC ensures that the nominee receives the claim amount promptly.
Tax Benefits: Policyholders can avail of tax benefits under Section 80C of the Income Tax Act, 1961, for the premium paid. Additionally, the death benefit received by the nominee is usually tax-free under Section 10(10D) of the same Act.
Benefits of LIC Term insurance plan
LIC (Life Insurance Corporation of India) term insurance plans offer several benefits to policyholders and their families. Here are some of the key advantages of LIC term insurance plans:
Financial Protection: The primary benefit of LIC term insurance plans is to provide financial protection to the policyholder's family in case of the policyholder's untimely demise during the policy term. The sum assured is paid to the nominee, ensuring that the family's financial needs are met, such as daily expenses, debts, education costs, and more.
Affordable Premiums: LIC offers term insurance plans at competitive premium rates, making it an affordable way to secure high coverage amounts. This affordability makes it accessible to a wide range of individuals and families.
High Coverage Amounts: LIC term insurance plans typically provide substantial coverage amounts, allowing policyholders to choose a sum assured that adequately meets their family's financial requirements.
Flexible Premium Payment Options: Policyholders can choose from various premium payment frequencies, including annual, semi-annual, quarterly, or monthly, depending on their convenience and cash flow.
Rider Options: LIC offers optional riders (additional coverage) that policyholders can add to their term insurance plans for enhanced protection. Common riders include accidental death benefit, critical illness rider, and disability benefit rider.
Choice of Policy Terms: LIC term insurance plans provide flexibility in selecting the policy term, allowing policyholders to align the coverage period with their financial goals and responsibilities.
LIC Term Policy Riders
These riders enhance the base term insurance policy by providing extra protection against specific risks or events. Keep in mind that the availability and terms of riders may vary depending on the specific LIC term insurance plan. Here are some common riders that LIC offered:
Accidental Death Benefit Rider: This rider provides an additional sum assured in case the policyholder's death occurs due to an accident. It ensures that the nominee receives a higher payout if the policyholder's demise is a result of an accident.
Critical Illness Rider: Under this rider, a lump sum amount is paid to the policyholder if they are diagnosed with a specified critical illness during the policy term. The illnesses covered may include cancer, heart attack, stroke, kidney failure, and others.
Permanent Disability Benefit Rider: In the event of permanent disability due to an accident, this rider provides a payout to the policyholder. The disability should meet specific criteria as mentioned in the policy document.
Waiver of Premium Rider: If the policyholder becomes disabled or incapacitated due to illness or injury, the waiver of premium rider ensures that future premiums are waived, but the policy remains in force. This rider helps to maintain the coverage even during times of financial hardship.
Income Benefit Rider: With this rider, a supplementary income is paid to the nominee over a specified period in addition to the death benefit. It helps provide financial stability to the family after the policyholder's demise.
Term Rider: The term rider allows the policyholder to add an additional term insurance coverage to the base policy. It provides an extra layer of protection at a lower cost.
Hospital Cash Benefit Rider: This rider offers a daily cash benefit during hospitalization due to illness or accident. It helps cover additional expenses associated with hospital stays.
Accidental Total and Permanent Disability Rider: This rider provides a benefit in case of total and permanent disability caused by an accident. It can help cover medical and living expenses in such situations.