With the help of LIC Unit Linked Insurance Plan (ULIP), you can invest in the market as well as financially protect yourself and your family from the unforeseen future. A part of the premium paid for LIC ULIP is invested in a range of market securities, each with different growth and return rate. Per unit price or the Net Asset Value (NAV) is determined by dividing the market value of the investment by the number of securities purchased.
Table of Contents:
Types of LIC ULIP
At present, LIC of India offers only one ULIP plan that offers both insurance coverage and high returns from market-linked investments i.e. LIC New Endowment Plus Plan.
Documents Required to Purchase Plans
Mentioned below are the lists of documents required to purchase LIC ULIP plan:
- Duly filled in and signed application form
- Photo ID proof of applicant (Aadhaar card, voter ID card, etc.)
- Address proof of applicant (Aadhar card, passport, utility bills, etc.)
- Passport size coloured photograph of applicant
- PAN Card
- Income proof (ITR details, salary slips, etc.)
- Other details asked by the insurer
LIC ULIP Plan
1. LIC New Endowment Plus Plan: It is a non-participating unit-linked endowment assurance plan that offers dual benefits of insurance and investment during the policy term. You can create long-term savings along with availing financial protection for yourself as well as your family. LIC ULIP offers you the flexibility to choose from the four funding options based on your risk appetite.
|
Particulars |
Details |
|
Entry Age |
90 days – 50 years |
|
Minimum Premium |
Rs. 20,000 per annum |
|
Sum Assured |
Higher of 10 x Annualised Premium or 105% of total premiums paid |
|
Features |
Death Benefits Maturity Benefits Rider Benefits |
Types of Investment Funds
The allocated premiums are invested in market funds to buy units which ultimately provide higher returns to the policyholder. Mentioned below are the four types of investment funds offered by LIC of India:
| Types of Funds | Investment in government securities/corporate debt | Investment in money market instruments | Investment in equity shares |
| Bond Fund | Not less than 60% | Not more than 40 % | Nil |
| Secured Fund | Not less than 45% | Not more than 40% | Not less than 15% and not more than 55% |
| Balanced Fund | Not less than 30% | Not more than 40% | Not less than 30% and not more than 70% |
| Growth Fund | Not less than 20% | Not more than 40% | Not less than 40% and not more than 80% |
Charges under ULIPs
A certain percentage of the premium is deducted towards charges. This is called premium allocation charges. This balanced allocation includes the part of premium which is invested in fund options for the policy. Mentioned below are the premium allocation charges under the plan:
| Premium | Premium Allocation Charges |
| 1st year | 7.50% |
| 2nd to 5th year | 5.00% |
| Thereafter | 3.00% |
Claim Process
Policyholders can file claim by simply visiting the nearest branch office of LIC and then following the below mentioned steps:
- Intimate about the claim to the insurance company and register the claim at branch.
- Submit the claim form along with all the relevant documents.
- Surveyor will assess the case and verify all the documents submitted.
- After successful verification, money will be transferred to the claimant’s bank account.
Documents Required to Process Claims
Given below are the lists of documents required while filing the claims:
- Original policy document
- Claim form
- NEFT details
- Proof of title
- Death certificate
- Medical treatment certificate
- Claimant’s proof of relationship
- Proof of age of the life assured
- FIR copy (in case of accident)
- Post-mortem report (in case of accident)
- Panchnama and a statement by eye witness (in case of accident)
Riders
Riders are additional benefits provided with the base plan that help enhance the coverage. LIC New Endowment Plus plan offers Accident Benefit Rider which can be availed by making an additional payment of premium. The riders provides additional sum insured, if the death occurs due to an accident.
Exclusions
The only exclusion which cannot be covered under LIC New Endowment Plus plan is the death due to suicide within 12 months from the date of commencement of policy or from the date of revival of policy.
Advantages of Buying LIC ULIP Plan
Given below are some of the advantages of buying LIC Endowment Plus plan:
- Previously the premium allocation charges were above 30%, but now they are as low as 7.5%
- If you surrender your policy after the lock-in period of 5 years, no discontinuation charges are applied
- Partial withdrawals are permitted (terms and conditions apply)
- You can opt to switch the policy to a paid-up policy, wherein the policy would remain in force, but you would not require to pay the premiums anymore. However, there is a high possibility of losing some of your benefits in the procedure
- You can opt for the accidental death cover – in case the policyholder dies due to an accident, the complete fund value is payable
FAQs
Q1. What are the available forms of payments available with LIC ULIPs?
The premium payment forms by LIC are:
- Cash, Cheque, or Demand Draft
- Axis bank payment
- NEFT
- Online payment
- Debit card
- Credit card
- Net Banking
- Corporation bank payment
- MP online
- AP Online
- Suvidha Infoserve
- Offline bill payment
- Authorised service provider
- Retired LIC employee collection
- Phone banking
- Premium point of empowered agents
- ECS
Q2. Can you get a refund of your premium if you are not satisfied with the policy?
If you are not content with the policy, you can claim for a refund of your premiums within 15 days of the receipt of the policy document. This period is known as the free look period.
Q3. How many premiums are used to purchase units?
The full premium paid is not dedicated to purchasing units. The company deducts various charges like manufacturing costs and invests the remaining amount for purchasing units.
Q4. Can you invest additional contribution above the regular premiums?
Yes, you can invest an additional amount over your regular premiums if your insurance provider offers the facility. This additional contribution is termed as top ups. With LIC you can take a top-up plan for accidental death benefits.
Q5. Can you switch between the fund options?
Yes, you can switch among the four funding options available with LIC ULIP plan. This is done without any charge.