LIC’s Jeevan Shiromani: An High Return Investment Opportunity
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Personal Finance
oi-Kuntala Sarkar
LIC’s Jeevan Shiromani has been designed by the public insurance corporation as an assured high return savings plan. The scheme is particularly targeted at high net-worth individuals. It is a non-linked, participating, individual, life assurance savings plan.
Policy benefits and sum assured
The minimum basic sum assured under this policy is Rs. 1 crore, with no maximum or upper limit. LIC informs, “Under this plan, Guaranteed Additions shall accrue at the rate of Rs. 50 per thousand Basic Sum Assured for the first five years and Rs. 55/- per 1000 Basic Sum Assured from 6th policy year till the end of premium paying term. In addition, the policy shall participate in the profits in form of Loyalty Additions.” The Basic Sum Assured will be in multiples of Rs. 5,00,000/-.
Eligibility
Any adult, till the age of 55 years can sign up for this plan. A person of 55 years old can take up this plan for a policy term of 14 years, similarly, a 51 years old can take up this for a policy term of 16 years, 48 years old can take up this for a policy term of 18 years, and a 45 years old can take up this for a policy term of 20 years.
Modes Of Premium Payment
The modes of premium payments are Yearly, Half Yearly, Quarterly, and Monthly, additionally a regular salary deductions (SSS) mode is also available under this plan.
Survival Benefits
The Survival Benefits on the life assured surviving to each of the specified durations during the policy term, a fixed percentage of Basic Sum Assured will be paid, according to the public life insurance corporation.
The fixed percentage for various policy terms has been mentioned as below:
| Policy term | percentage |
|---|---|
| For policy term 14 years | 30% of Basic Sum Assured on each of 10th and 12th policy anniversary |
| For policy term 16 years | 35% of Basic Sum Assured on each of 12th and 14th policy anniversary |
| For policy term 18 years | 40% of Basic Sum Assured on each of 14th and 16th policy anniversary |
| For policy term 20 years | 45% of Basic Sum Assured on each of 16th and 18th policy anniversary |
Maturity Benefit
The Maturity Benefit on the life assured of the policyholder, surviving to the end of the policy term is the Sum Assured on Maturity along with accrued Guaranteed Additions will be paid.
The Sum Assured on Maturity has been mentioned as below:
| Policy term | percentage |
|---|---|
| For policy term 14 years | 40% of Basic Sum Assured |
| For policy term 16 years | 30% of Basic Sum Assured |
| For policy term 18 years | 20% of Basic Sum Assured |
| For policy term 20 years | 10% of Basic Sum Assured |
Death Benefits
If the policyholder dies, during the first 5 years, the Sum Assured on Death benefits along with accrued Guaranteed Additions will be paid. If the policyholder dies, after 5 years of the policy, but before the date of maturity, the Sum Assured on Death benefits along with accrued Guaranteed Additions and Loyalty Addition (if any) will be paid. LIC will count the Sum Assured on Death benefits as the higher of 7 times of annualized premium or 125% Basic Sum Assured. This death benefit will not be less than 105% of all the premiums paid as of the date of death. Premiums are not included any taxes, while the extra amount is chargeable under the policy.
To know more details and application check this official LIC link: https://licindia.in/Products/Insurance-Plan/LIC-s-Jeevan-Shiromani-(Plan-No-947,-UIN-512N315V0
Policy Loan Loan facility is available under this plan, after payment of premiums for at least 1 full year’s premium has been paid and on completion of 1 policy year.
Taxation
As per LIC, “Taxes Statutory Taxes, if any, imposed on such insurance plans by the Government of India or any other constitutional tax Authority of India shall be as per the Tax laws.”
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