LIC New Children's Money Back Plan

LIC's New Children’s Money Back Plan is a non-linked participating money back plan from Life Insurance Corporation of India. The plan is specifically designed and customized to take care of higher educational, dream wedding and other needs of children through the Survival Benefits of the policy. In addition to this, the LIC new children money back plan provides for the risk cover on the life of a child during the policy term and for other benefits on surviving till the end of the specified policy duration.

• Death benefit: If the policyholder dies within the duration of the policy before its maturity and the policy is in full force, then the death benefit will be payable. Thus, on the death of the life assured after the date of commencement of risk, the death benefit will be sum assured on death, plus vested simple reversionary bonus and a final additional bonus, if any, will be payable. The sum assured will be higher than 10 times of the yearly premium or equal to basic sum assured to be payable on death. The death benefit will not be lesser than 105% of the total premiums paid as on the date of the death of the life insured. The premiums mentioned will be an exclusion of rider premium, additional premium, and taxes.

• Survival Benefit: If the life assured survives the policy anniversary and reaches the ages of 18 years, 20 years and 22 years, then 20% of the basic sum assured will be paid on each occasion provided the policy is in full force.

• Maturity Benefit: If the life assured survives the specified date of maturity, then sum assured on maturity will be 40% of the basic sum assured along with vested Simple Reversionary Bonuses and final additional bonus, if any. The condition is the policy needs to be in full force.

• Participation in Profits: As this is a participating plan, it is entitled to share the profits of the corporation as per the experience of the corporation. The bonus will be added to the policy when a claim is raised in the policy, either by death or maturity.

• Optional Benefit: Option to defer the Survival Benefit(s): The policyholder has the option to defer the survival benefit at any time during or after the due date but during the currency of the policy. The benefit of deferment will result in the corporation paying an increased survival benefit to the policyholder as per the terms and conditions mentioned in the policy document. The policyholder will be required to give in writing 6 months before the due date of the maturity of policy/ survival benefits due date to the servicing branch of policy.

Customers who are going to purchase this policy will need to pay the premium for the entire policy term. The premium payment options are flexible with options to pay on a monthly, quarterly, half-yearly or yearly basis. There is no limit on the amount of the premium payable as it will be decided by the sum assured opted by the individual.

• Valid government ID proof like driving license, passport, aadhaar card, Pan card etc.
• Age proof
• Valid address proof like electricity bill, telephone bill , any utility bill
• Medical history
• Any KYC documents
• Medical test if required
• Any other document which the life insurer may ask for, depending on case to case basis

Mr. and Mrs. Sharma, parents of 2-year-old Amit, want to understand how this plan works. The couple works as Directors of a company and are well to do, but they want to select an insurance plan to ensure that the financial needs of their child are met in the future. Mr and Mrs Sharma go for a basic sum assured equal to INR 15 lakh, paying a premium of INR 25,000 approximately per year for the same. Mr. Sharma pays this amount as per the policy schedule, ensuring that the plan does not lapse due to non-payment of the policy premium. As part of the benefits, Mr. Sharma receives 20% or Rs.3 lakhs when Amit reaches the age of 18 years. Amit will get additional survival benefits of Rs. 3 lakhs each when he turns 20 and 22 years. When Amit will be of 25 years of age, he will get a sum equivalent to the pending 40% of the sum assured, i.e., Rs.6 lakhs plus any additional benefits in the form of bonuses which have been accrued in the plan as it is a participating plan. If there is an unfortunate demise of Amit during the policy term, the death benefit will be payable to the parents i.e. Mr. and Mrs. Sharma. If the death occurs before the risk has commenced, then only the premiums will be returned to the parents. If the proposer of the policy that is the parents die during the active policy term and they had added the premium waiver rider, then all the future premiums in the policy will be waived off and Amit’s future will be secured. The policy will continue to be active and will pay off the benefits mentioned in the policy document.