LIC Bima Shree – New Moneyback Plan | Features, Review & Returns Calculation

LIC is proposing to launch its new MONEY-BACK plan called LIC Bima Shree (Plan no.848) on 16th March, 2018. Bima Shree is a Non linked, Money back, Limited premium payment with guaranteed additions plan. This plan is almost similar to LIC’s recently launched plan i.e., Jeevan Shiromani.

What are Money-back policies? – They provides life coverage during the term of the policy and the maturity benefits are paid in installments by way of Survival Benefits (money-back payments).

What are Limited Premium Payment Insurance Plans? – A limited premium payment plan is a plan where you pay the premium for a shorter span of time and enjoy the benefits of an insurance cover for a long time.

Basic Features of LIC Bima Shree Plan

Below are the eligibility conditions for Bima Shree Policy ;

• Minimum Age at entry : 8 years
• Maximum age at entry : 55 years for 14 years policy term (PT), 51 for 16 PT, 48 for 18 & 45 for 20 PT
• Minimum basic sum assured (BSA) : Rs 10 Lakh
• Maximum basic sum assured (BSA) : No Limit
• Policy term and premium paying term : PPT = Policy Term – 4 years
  • For a 14 year Policy -> PPT is 10 years
  • 16 year Policy -> PPT is 12 years
  • For a 18 year Policy -> PPT is 14 years
  • For a 20 year Policy -> PPT is 16 years
• Guaranteed Additions under Bima Shree Plan;
  • Guaranteed Addition for first 5 policy years is Rs 50 per Rs 1,000
  • From 6th Year onwards, GA is Rs 55 per Rs 1,000.
• In-built Critical Illness Benefit :
  • Bima Shree plan has an inbuilt Critical illness benefit. 
  • 15 Critical illnesses are covered in this plan.
• Settlement option for the death benefit and survival benefit available.
  • The policyholder can receive the settlement amount, it can be either death(nominee will receive death benefit), survival benefit (or) maturity benefit, in installments over the chosen periods like 5 years, 10 years or 15 years (or) in the form of one-time lump sum payment.
• The policy is eligible for Paid-Up and Surrender after the completion of two policy years.

Benefits under LIC’s new Bima Shree Plan

Below are the benefits under Bima Shree Money-back plan;

• Death Benefit : Under this new plan, the risk commences immediately on issuance of Policy.
  • If the insured dies within 5 years : Sum assured (SA) + Guaranteed Addition (GA) is payable to the nominee.
  • If the insured dies after 5 years : Sum assured (SA) + Guaranteed Addition (GA) + Loyalty Addition (LA) is payable to the nominee.
  • Meaning of “Sum Assured on Death” is defined as HIGHER of the below.
    • 10 times of your annual premium (excluding taxes, the extra amount due to underwriter decisions or rider premium).
    • 125% of Basic Sum Assured.
    • 105% of all the premiums paid as on date of death.
• Survial Benefits (or) Money-back options under Bima Shree Policy;
  
  • For 14 year Policy : 30% of Sum-assured is payable in 10th & 12th policy year and the remaining 40% is payable after the 14th year.
  • For a 16 year policy : 35% of SA in 12th & 14th year and the remaining 30% is payable after the 16th year.
  • Under 18 year policy : 40% of SA in 14th & 16th year and the remaining 20% of SA is payable after the 18th year.
  • For a 20 year policy : 45% of SA in 16th & 18th year and the remaining 10% of SA is payable after the 20th year.
• Maturity Benefit : After completion of the policy term, the remaining sum assured (Sum Assured excluding survival benefits already paid) along with Guaranteed Additions and Loyalty Additions (kindly note that Loyalty Additions are payable after five policy years only) is payable to the life assured.
  

LIC Bima Shree – New Money Bank Plan – Graphical Illustration

Below is the graphical illustration of Bima Shree Plan (20 year term).

• For a 20 year policy, the Premium paying term would be 16 years.
• 1st Survival benefit of 45% of Basic Sum Assured is payable in 16th year and 2nd SB in 18th year.
• Guaranteed Additions at the rate of Rs 50 p.a. per Rs 1,000 Sum Assured is payable for the first five policy years. Form 6th year till 20th year, GA @ Rs 55 p.a. per Rs 1,000 SA is payable on maturity/death of the policyholder.
• If death occurs during the first five years, death benefit of Sum assured on death + accrued Guaranteed Additions is payable to the nominee. In case, death occurs after 5 years, death benefit = SA + GA + Loyalty Addition is payable.
• After 20 years, the maturity benefit would be equal to 10% of BSA + accrued GAs + LA is payable.

MORE WILL UPDATE SOON!!