- About Coverfox
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.
|Maturity benefits of the plan||A maturity benefit will be equivalent to the sum assured on maturity and accrued bonuses (if any) payable|
|Premium payment frequency||Monthly, quarterly, half-yearly or Yearly|
|Cooling off period/Free look||The policy comes with a freelook period of 15 days|
|Revival conditions||Lapsed policies can be revived within the 2 years of the last premium due date as per the terms and conditions.|
|Loan||Loan facility is available in this plan on the surrender value accumulated|
|Grace period||Monthly payment mode has a grace period of 15 days. The grace period is 30 days for rest of the payment modes i.e. quarterly, half-yearly and yearly|
|Rebate||Rebate is provided on selecting high sum assured|
|Sum assured of the plan||Minimum - INR 1 lakh|
|Maximum – The plan does not have any upper limit|
|Coverage of the plan||Maturity benefit, Death benefit and survival benefit|
|Policy type||Non-linked participating money back plan|
|Policy basis||Individual basis|
|Plan term||25 years less age of entry|
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.
Grace period - The policy has a grace period of 15 days for monthly premium paying mode, and 30 days for quarterly, half-yearly and yearly premium paying mode. All the benefits will be active in the policy during the grace period. If the individual fails to pay the policy premium during the grace period, then the policy will lapse.
Policy termination - The policy can be surrendered after completion of 3 years of the premium paying term. The surrender value will be a percentage of total premiums paid minus extra premium, rider premium and survival benefits already due or payable. The surrender value will depend on the policy year and term in which the policy is being surrendered.
Free Look period - If the individual or the policyholder is not happy with the terms and conditions of the policy, then he/she has the option to return the policy back to the corporation within a period of 15 days citing the reasons for cancellation. The corporation will cancel the policy and the refund the premium paid, after deducting the proportionate risk premium for the period on a cover and any other applicable charges like stamp duty.
Loan facility - A loan can be taken against the policy as per the surrender value accumulated in the policy. The loan is disbursed as per the terms and conditions which the corporation may specify from time to time.
Suicide clause - If the life assured whether sane or insane commits suicide within 12 months of the inception of the policy or from revival date, then no death benefit is payable. The insurance company will only refund 80% of the premiums paid back to the nominee. The clause is not valid if the age of entry of the life assured is below 8 years.
LIC’s Premium Waiver Benefit Rider - The LIC's New Children’s Money Back Plan comes with a very useful premium waiver rider which is available on offer for the life of proposer aged between 18 to 55 years. The rider can be attached to the base plan for an additional premium payable. If the proposer dies within the active policy term, then the future premiums under the basic plan will be waived off. The rider benefit will not be given if the proposer commits suicide within the 12 months of commencement of policy or from the revival date of the policy.
Tax Benefits - The premiums paid for the policy can be claimed for tax deduction under Section 80C of the Income Tax Act, 1961. Likewise, the claim amount received from the policy will get tax benefit under Section 10(10D) of the Income Tax Act, 1961.
|Minimum age for entry in policy for life assured||0 (last birthday)|
|Maximum age for entry in policy for life assured||12 (last birthday)|
|Minimum/maximum maturity age for life assured||25 (last birthday)|
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.