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LIC Jeevan Anand 149 in Depth

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Apr 012013

LIC Jeevan Anand (Table 149) was launched in 2002 by Life Insurance Corporation of India. This is one of the most successful product from LIC. Even though LIC added many new plans to individual policy segment but Jeevan Anand still holds good position. This policy is a combination of endowment assurance plan and whole life plan. This is a double profit policy where life insured gets maturity claim amount at the end policy term and later an amount of life cover is given to nominee / legal heirs on death of life insured. Life insured need not to pay additional premium after maturity to continue life cover. Apart from this, accidental death benefit is there in this plan at no extra premium.

Why Jeevan Anand ?

Lets we look up all benefits and features of LIC table 149 here.

On Maturity?
This is what a life insured mainly looks while purchasing endowment plan and undoubtedly this plan has proved well here. Jeevan Anand promises SUM assured along with Bonus, if any at the end of selected policy term. SUM assured is decided by life insured while purchasing life insurance plan. Bonus: Bonus is a part of corporation business profit and LIC India shares it among policy holders (with-profit plans) time to time. In this plan bonus is declared every year with four slab divided policy term wise. Bonus is declared unit per 1000 rupees of SUM assured. Bonus is paid at the end of policy term or earlier in case of death during selected policy term.

On death?
Amount of death claim are different for death before policy term and death after policy term. On Death Before Policy Term: Death benefit before selected policy term will be basic SUM assured along with bonus earned till the time. On Death After Policy Term: This policy gives life time risk cover so the life insured death at any time after selected policy term will be an amount equal to SUM assured. On Death Due to Accident: Jeevan Anand plan provides double accidental death benefits up to 5 Lacs SUM assured till 70 years of age. No extra premium will be charged for this feature. In case of permanent disability due to accident, an additional SUM assured will be paid in instalments.

On Surrendering Policy?
Surrendering any life insurance plan has never been good idea especially endowment and whole life plans. So once taken, insurance plan should not be surrendered unless it is really not possible to continue. Although LIC offers Guaranteed Surrender value in Jeevan Anand plan after 3 years of premium payment but that is too low. Life insured gets 30% of total premium paid excluding first year premium and extra premium. Surrender value may differ in case of corporation policy surrender. Others: Life insured can apply for loan against Jeevan Anand policy. Income tax benefits under section 80 C for premium paid and under section 10 (10 D) for maturity claim are available as per Income Tax Act 1961. Example:

For instance Mr. Amit is 25 years old. He decides to take Jeevan Anand for SUM assured of Rs. 100,000 for 25 years policy term. Then following will be the maturity and other benefits calculations chart: His premiums will be: Rs. 4,200.00 Yearly. Assuming bonus per year Rs. 47 (2011-12 Bonus for 21 years and above term) each year for next 25 years. Annual Bonus = (100,000 / 1000) * 47 = 47,00 Total bonus (In 25 years) = 47,00 * 25 = 117,500 Total maturity amount after selected term = 100,000 (SUM Assured) + 117,500 (Bonus) = Rs. 217,500 In case of death in 11th policy year: 100,000 (Basic SUM assured) + (47000) Bonus In case of death after 25 policy years: 100,000 (Basic SUM Assured) In case of accidental death till 70 years of age: 200,000 (In lump sum, Double of Basic SUM Assured) In case of permanent disability due to accident till 70 years of age: 200,000 (In instalments) Is LIC Jeevan Anand Beneficial for You? Apart from risk cover factor, if we look at the policy in term of saving, is it worth buying? Considering bonus in last few years (2009 2012), Jeevan Anand has distributed bonus Rs 35 to Rs 47 per unit. This return can be considered to be good when policy gives bonus on total SUM assured from first year of policy term while you are still paying premiums. Double benefits of maturity and lifetime risk cover add special value to this plan. Policy Eligibility Chart: Age entry: 18 to 65 years Maximum Maturity Age: 75 Years Minimum / Maximum Premium paying Term: 5 years to 57 years Minimum / Maximum SUM Assured: Rs.1,00,000 and more (No upper limit)

Note: Above data and calculations are for information and illustration purpose only. Nothing published on this site should be considered as investment advice.