LIC Nivesh Plus 749
LIC Nivesh Plus 749 is a one-time payment, unit-linked, Individual Savings Plan which becomes effective on October 14, 2024. It supports saving money and life insurance together. People choose how much coverage they desire, which funds to select and if they want part of their money at times. This plan helps people who wish for investments linked to the market and life safety.
The Unique Identification Number (UIN) for LIC Nivesh Plus 749 is 512L317V02.
Key Components of LIC Nivesh Plus 749
- Single Premium Payment: This plan is a one-time investment policy where the premium is paid as a lump sum.
- Life Insurance Cover: Provides life coverage throughout the chosen policy term.
- Guaranteed Additions: Added to the unit fund at specified durations.
- Partial Withdrawals: After five years, policyholders can withdraw a portion of the fund.
- Linked Accidental Death Benefit Rider: Optional rider for additional coverage.
LIC Nivesh Plus 749 : Features and Eligibility
| Eligibility Criteria | Option 1 (1.25x Single Premium) | Option 2 (10x Single Premium) |
|---|---|---|
| Plan Type | Single Premium, Unit-Linked | Single Premium, Unit-Linked |
| Minimum Age at Entry | 90 days | 90 days |
| Maximum Age at Entry | 70 years | 35 years |
| Minimum Sum Assured | 1.25 times the single premium | 10 times the single premium |
| Maximum Sum Assured | Based on single premium, no upper limit | Based on single premium, no upper limit |
| Minimum Maturity Age | 18 years | 18 years |
| Maximum Maturity Age | 85 years (nearer birthday) | 50 years (nearer birthday) |
| Policy Term Options | 10 to 25 years (varies by entry age) | 10 to 25 years |
| Premium Payment Mode | Single premium only | Single premium only |
| Minimum Premium Amount | ₹1,25,000 (in multiples of ₹5,000) | ₹1,25,000 (in multiples of ₹5,000) |
| Maximum Premium Amount | No limit | No limit |
| Guaranteed Additions | 3% to 7% of the single premium at specified policy years | 3% to 7% of the single premium at specified policy years |
| Partial Withdrawals | Allowed after five years | Allowed after five years |
| Fund Options | Bond, Secured, Balanced, Growth | Bond, Secured, Balanced, Growth |
| Settlement Option for Death Benefit | Lump sum or installments over 5 years | Lump sum or installments over 5 years |
| Optional Rider | Linked Accidental Death Benefit Rider | Linked Accidental Death Benefit Rider |
| Surrender Option | Allowed anytime; surrender value payable after a 5-year lock-in | Allowed anytime; surrender value payable after a 5-year lock-in |
| Tax Benefits on Premiums | Tax deduction under Section 80C (subject to conditions) | Tax deduction under Section 80C (subject to conditions) |
| Tax Benefits on Maturity | Benefits under Section 10(10D), provided conditions met | Benefits under Section 10(10D), provided conditions met |
| Fund Switching | Up to four free switches per year between funds | Up to four free switches per year between funds |
Here :
Option 1 (1.25x Single Premium): Here, the Basic Sum Assured is 1.25 times the single premium amount. For example, if the single premium paid is ₹1,00,000, then the Basic Sum Assured will be ₹1,00,000 × 1.25 = ₹1,25,000. This option provides lower life cover with more focus on investment growth.
Option 2 (10x Single Premium): Here, the Basic Sum Assured is 10 times the single premium amount. For instance, if the single premium paid is ₹1,00,000, then the Basic Sum Assured will be ₹1,00,000 × 10 = ₹10,00,000. This option offers higher life cover, suitable for those prioritizing greater life protection.
Benefits of LIC Nivesh Plus 749
Maturity Benefit:
On Survival until Maturity: The policyholder receives the Unit Fund Value as the Maturity Benefit. This is paid as a lump sum at the end of the policy term.
Guaranteed Additions of LIC Nivesh Plus 749
| End of Policy Year | Guaranteed Additions (as percentage of Single Premium) |
|---|---|
| 6 | 3% |
| 10 | 4% |
| 15 | 5% |
| 20 | 6% |
| 25 | 7% |
Death Benefit:
- After Commencement of Risk: If the policyholder dies after risk cover begins, the nominee receives the higher of:
- The Basic Sum Assured (adjusted for any partial withdrawals made within the last two years) or
- The Unit Fund Value at the time of death.
Any mortality or accident benefit charges deducted after death are refunded to the nominee. The death benefit can be paid in a single payment or instalments over up to 5 years, as chosen by the policyholder.
Investment Fund Types in LIC Nivesh Plus 749 Plan
The Policyholder selects one of the four funds to invest their premiums at first and during fund switching. Remember up to four free switches per year between funds:
| Fund Type | Investment in Government or Corporate Debts | Short-term Money Market Instruments | Investment in Equity Shares | Objective | Risk Profile |
|---|---|---|---|---|---|
| Bond Fund | 60% to 100% | 0% to 40% | NIL | To provide safe and less volatile investment in fixed-income securities. | Low Risk |
| Secured Fund | 45% to 85% | 0% to 40% | 15% to 55% | To provide regular income through both equities and fixed-income securities. | Low to Medium Risk |
| Balanced Fund | 30% to 70% | 0% to 40% | 30% to 70% | To provide balanced income and growth through both equities and fixed-income securities. | Medium Risk |
| Growth Fund | 20% to 60% | 0% to 40% | 40% to 80% | long-term capital growth through investment primarily in equities. | High Risk |
Note: Remember, the higher the risk, the greater the reward.
LIC Nivesh Plus Plan 749 with Calculation
LIC Nivesh Plus policy is a Unit Linked Insurance Plan (ULIP) that combines investment with life insurance coverage. Below is an example illustrating how this policy functions.
choose the death benefit between this two options:
a) Option 1: Basic Sum Assured is 1.25 * Single Premium.
b) Option 2: Basic Sum Assured is 10 * Single Premium
Policy Details:
- P0licyholder Age: 30
- Investment Amount: Rs. 200,000
- Policy Term: 20 years
Option 1: Basic Sum Assured is 1.25 times the Single Premium
Basic Sum Assured: (1.25 × Rs. 200,000) = Rs. 250,000
| End of Policy Duration (Years) | Return | Before Guaranteed Additions | Guaranteed Additions | After Guaranteed Additions | Sum Assured | Death Benefit |
|---|---|---|---|---|---|---|
| 6 | @4% | Rs. 137,920 | Rs. 3,750 | Rs. 141,670 | Rs. 141,670 | Rs. 156,250 |
| 6 | @8% | Rs. 173,172 | Rs. 3,750 | Rs. 176,922 | Rs. 176,922 | Rs. 176,922 |
| 15 | @4% | Rs. 180,383 | Rs. 6,250 | Rs. 186,633 | Rs. 186,633 | Rs. 186,633 |
| 15 | @8% | Rs. 313,458 | Rs. 6,250 | Rs. 319,708 | Rs. 319,708 | Rs. 319,708 |
| 20 | @4% | Rs. 209,775 | Rs. 7,500 | Rs. 217,275 | Rs. 217,275 | Rs. 217,275 |
| 20 | @8% | Rs. 433,980 | Rs. 7,500 | Rs. 441,480 | Rs. 441,480 | Rs. 441,480 |
Here:
Maturity Benefit at 20 Years:
- Rs. 2,17,275 at 4% p.a.
- Rs. 4,41,480 at 8% p.a.
Average Annual Return: Approximately 6.79% at 8% p.a.
Option 2: Basic Sum Assured is 10 times the Single Premium
Basic Sum Assured: (10 × Rs. 200,000)= Rs. 2,000,000
| End of Policy Duration | Return | Before Guaranteed Additions | Guaranteed Additions | After Guaranteed Additions | Sum Assured | Death Benefit |
|---|---|---|---|---|---|---|
| 6 | @4% | Rs. 125,798 | Rs. 3,750 | Rs. 129,548 | Rs. 1,250,000 | Rs. 1,250,000 |
| 6 | @8% | Rs. 159,595 | Rs. 3,750 | Rs. 163,345 | Rs. 1,250,000 | Rs. 1,250,000 |
| 15 | @4% | Rs. 134,981 | Rs. 6,250 | Rs. 141,231 | Rs. 1,250,000 | Rs. 1,250,000 |
| 15 | @8% | Rs. 256,362 | Rs. 6,250 | Rs. 262,612 | Rs. 1,250,000 | Rs. 1,250,000 |
| 20 | @4% | Rs. 128,576 | Rs. 7,500 | Rs. 136,076 | Rs. 1,250,000 | Rs. 1,250,000 |
| 20 | @8% | Rs. 328,156 | Rs. 7,500 | Rs. 335,656 | Rs. 1,250,000 | Rs. 1,250,000 |
Here:
Maturity Benefit at 20 Years:
- Rs.1,36,076 at 4% p.a.
- Rs. 3,35,656 at 8% p.a.
Average Annual Return: Approximately 6.79% at 8% p.a.
NOTE: Policyholder can choose between two options for his LIC Nivesh Plus 749 investment. Option 1 provides a lower sum assured with a higher potential fund value, while Option 2 offers a significantly higher sum assured but with lower fund value growth.
Charges Under LIC Nivesh Plus 749
Charges Under the LIC Nivesh Plus Plan (Plan No. 749) :
- Premium Allocation Charge:
- Offline Sale: 3.30% of the premium.
- Online Sale: 1.50% of the premium.
- Mortality Charge:
- This charge covers life insurance and varies by age. It is deducted monthly by cancelling units from the fund.
- Accident Benefit Charges (if the Accident Benefit Rider is opted):
- Standard Rate: Rs. 0.40 per Rs. 1,000 of Accident Benefit Sum Assured.
- Police Duty Rate: Rs. 0.80 per Rs. 1,000 if the policyholder is on police duty (not paramilitary).
- Fund Management Charge (FMC):
- Regular Funds: 1.35% per annum of the fund value for Bond, Secured, Balanced, and Growth funds.
- Discontinued Policy Fund: 0.50% per annum.
- Switching Charge:
- The first four switches in a policy year are free.
- Subsequent switches: Rs. 100 per switch.
- Partial Withdrawal Charge:
- Rs. 100 per partial withdrawal.
- Discontinuance Charge:
- Varies based on premium and year of discontinuance, with maximum charges set by policy year:
- Year 1: Up to Rs. 3,000 (or Rs. 6,000 for higher premium policies).
- Year 5 onwards: No charge.
- Varies based on premium and year of discontinuance, with maximum charges set by policy year:
- Tax Charge:
- Tax as per applicable laws will be levied on charges.
- Miscellaneous Charge:
- Rs. 100 per alteration in the policy, such as adding a rider after issuance.
- Right to Revise Charges:
- LIC reserves the right to revise charges, except for mortality and accident benefit charges, with a 3-month notice to policyholders.
FAQs on LIC Nivesh Plus 749
Q1. What is NAV and how is it calculated?
NAV (Net Asset Value) is the price per unit of the investment fund. It is calculated daily based on the market value of the fund’s investments, adjusted for liabilities and expenses. The formula is:
NAV = (Market Value of Investments + Current Assets – Current Liabilities) / Number of Units.
Q2. Can I make partial withdrawals from my policy?
Yes, partial withdrawals are allowed after the fifth policy year. However, a minimum balance equal to the single premium amount must remain in the fund.
Q3. What happens if I want to switch between investment funds?
You are allowed up to four free switches between funds per year. For any additional switches, a charge of ₹100 per switch is applied, deducted by canceling units from the fund.
Q4. How are charges deducted from the policy?
Charges such as the Premium Allocation Charge, Mortality Charge, Fund Management Charge, and others are deducted by canceling units from your Unit Fund. These charges vary depending on the type and terms of the policy.
Q5. How are Guaranteed Additions credited to the policy?
Guaranteed Additions are credited as a percentage of the single premium at specified policy durations (years 6, 10, 15, 20, and 25). They are converted into units based on the NAV at the time of credit.
Q6. Can I surrender the policy before maturity?
Yes, you can surrender the policy anytime. However, if you surrender within the first 5 years, the Unit Fund Value will be transferred to the Discontinued Policy Fund and paid out only after the lock-in period ends. After 5 years, the full Unit Fund Value is payable without any deductions.
Q6. Can I reinstate a surrendered policy?
No, once surrendered, the policy cannot be reinstated.
Q7. Is there a Free Look Period?
Yes, you have 30 days to review the policy and cancel if unsatisfied. The premium is refunded minus certain charges.
Q8. What is the Linked Accidental Death Benefit Rider?
This optional rider provides additional coverage in case of accidental death. It can be added at any policy anniversary, provided the remaining policy term is at least 5 years and the life assured is under 65 years of age.
Q9. What is the Discontinued Policy Fund?
If you surrender within the lock-in period, your funds are moved to the Discontinued Policy Fund, earning a guaranteed interest of 4% per annum until the end of the lock-in period.
Q9. Are there any tax benefits under this plan?
Yes, premiums are eligible for tax deductions under Section 80C, and maturity proceeds may be tax-free under Section 10(10D).
Q10. Can I take a loan against this policy?
No, loans are not allowed under LIC Nivesh Plus 749.
Q11. What is the maturity benefit?
On maturity, the Unit Fund Value is paid as a lump sum.
Q12. What is the free look cancellation process?
If canceled within the Free Look Period, the premium is refunded after deducting medical, stamp duty, and proportionate charges.
Q12. How does the policy terminate?
The policy terminates upon maturity, death benefit payment, or if the fund value is insufficient to cover charges after 5 years.
Q13. Can I reduce or increase my coverage?
No, you cannot alter the Basic Sum Assured or benefits during the policy term.
Q14. What are the investment risks in LIC Nivesh Plus 749?
Being a ULIP, returns depend on market performance, and there are no guaranteed returns except for the specified Guaranteed Additions.