Sunday, December 14, 2008

LIC Insurance Plan - Jeevan Aastha

jeevan aastha

LIC's Jeevan Aastha is a single premium assurance plan which offers guaranteed benefits on death and maturity. The Plan is close ended and would be available for a maximum period of 45 days from the date of its launch i.e. 08.12.2008 .

1.Eligibility conditions and other restrictions
a) Minimum Entry Age : 13 years (completed)
b) Maximum Entry Age : 60 years (nearest birthday)
c) Minimum Basic Sum Assured: Rs.150,000
d) Maximum Basic Sum Assured: No Limit
The basic sum assured shall be available in multiples of Rs. 30,000.
e) Policy Term : 5 or 10 years
f) Premium payment mode : Single premium only

2.LoanLoan facility will be available to you under this plan , after completion of one policy year.

3.Surrnder value
The policy can be surrendered for cash after the policy has run for at least one year. The minimum Guaranteed Surrendered Value allowable is equal to 90% of the Single premium paid excluding all extra premiums.
Corporation may however pay Special Surrender value as applicable on the date of surrender provided the same is higher than the guaranteed Surrender Value.

The Special Surrender Value will be the discounted value of the Maturity Sum Assured and Guaranteed Additions accrued as on date of surrender.

4.Cooling-off period
In case one is not satisfied with the "Terms and Conditions" of the policy , the same can be returned to us within 15 days
A)Death Benefit:
On death during the first policy year: Basic Sum Assured with Guaranteed Addition.
On death during the policy term after first policy year, excluding last policy year: 1/3rd of Basic Sum Assured with Guaranteed Addition.
On death during last policy year: 1/3rd of Basic Sum Assured with Guaranteed Addition along with loyalty addition, if any

B)Maturity Benefit:
On maturity, the maturity Sum Assured along with Guaranteed Addition and Loyalty Addition, if any, shall be payable.
Maturity Sum Assured shall be 1/6th of Basic Sum Assured.
C)Guaranteed Addition:
The policy provides for Guaranteed Addition at the following rates:
  • Rs. 100 per thousand Maturity Sum Assured per year for a policy of 10 years term.
  • Rs. 90 per thousand Maturity Sum Assured per year for a policy of 5 years term.
D)Loyalty Addition:
Depending upon the Corporation's experience the policy will be eligible for Loyalty Addition on death during the last policy year or on the Life Assured surviving the stipulated date of maturity at such rate and on such terms as may be declared by the Corporation

6.Our view:
The investor would get a return of 7-8% depending on your age. The insurance value is good for the first term but thereafter it is 50%. The investment is tax free - both interest and maturity amount. If you get a loyalty bonus at the end of term, the rate of return may increase. However, if it is 0%, why not invest in PPF. The scheme is just about ok. When we first read it, it looked very promising and we almost decided to invest in this. However, when we dug deep into the details, it didn't look that great. If you are interested in insurance, don't even think about this. It is ok from an investment perspective, but there are products like PPF and FDs also available.

You can apply online from our website too if you are interested!


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