LIC Single Premium Endowment Plan
The Single Premium Endowment Plan from LIC is a one-time investment vehicle that enables you to cover both your life insurance needs and long-term financial objectives. The plan is a great way to stash windfall profits without having to worry about future premium payments. The Single Premium Endowment Plan from LIC also provides other advantages that a life insurance policy delivers. It is participation insurance, thus at the end of the policy term, there are Guaranteed Additions.
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LIC Single Premium Endowment Plan- Features Review
Take a look here for the features of LIC premium endowment plan:
- Being a single premium plan, the entire payment must be paid before the policy begins.
- It is an unlinked, participatory endowment plan.
- The insurance provides both life protection and financial savings.
- There is no maximum sum promised under this plan, and the minimum sum assured is INR 50,000.
- The policy will expire after delivery of death benefit or maturity benefit whichever occurs first
- If the policy is in full force, it pays out Simple Reversionary Bonuses and a final supplementary bonus that has been determined based on the corporation’s experience.
- Risk coverage will begin for policyholders under the age of 2 years and will begin right away for those with policies lasting more than 8 years.
LIC Single Premium Endowment Plan- Benefits
- Maturity Benefit:
Maturity Benefit: If the policyholder lives to see the maturity date, he or she will be given a sum equal to the Sum Assured, plus Simple Reversionary Bonuses and Final Additional Bonus, if applicable.
- Participation in LIC Profits:
Participation in LIC Profits: Based on LIC’s experience, policyholders will be eligible to receive Simple Reversionary Bonuses and a portion of LIC’s profits.
- Final Additional Bonus:
Final Additional Bonus: This bonus sum may be announced throughout the insurance year when a death or maturity claim is made. The terms and circumstances for this are chosen by LIC at their discretion and announced.
- Death Benefit:
If the policyholder passes away while the policy is still in effect (after the risk has started), the designated nominees or dependents of the policyholder will be entitled to a sum equal to the Sum Assured plus any Simple Reversionary Bonuses and Final Additional Bonus, if any.
However, the company will pay the dependents an amount equivalent to the single premium paid less service tax and extra premium if the life insured passes away prior to the start of risk. This sum is free of interest.
LIC Single Premium Endowment Plan Offers Additional Tax Benefits
- Free-look Period – If the policyholder is unhappy with the plan, he has 15 days from the plan’s issue to terminate the coverage. The free-look period is the name of this time frame. The premium paid, less any necessary costs would be reimbursed after cancellation.
- Loan-After one policy year, you can apply for a loan against this policy.
- Surrender Value: If you decide to cancel the plan, you will receive a portion of the one-time premium you paid. The premium amount without taxes is what the guaranteed surrender value is based on.
- You receive 70% of the single premium refunded if you surrender in the first year.
- After that, you get reimbursed for 90% of the single premium.
- Values associated with bonuses – The bonus that has been declared for the plan has a surrender value as well. Surrender Value Calculations in LIC Single Premium Endowment Plan provide a clearer explanation of this.
LIC Single Premium Endowment Plan’s Tax benefits
The single premium you paid to purchase this LIC one-time investment plan is regarded in your hands as a tax-free expense. In accordance with Section 80C of the Income Tax Act of 1961, you may deduct the premium you paid. The most that can be deducted from premium payments is up to 1.5 lakhs of Indian rupees. Additionally, you earn tax-free benefits from this LIC one-time investment plan when you die or reach maturity. On these benefits that you receive, there is no tax due. Under Section 10 (10D) of the Act, they would be entirely exempt from all taxes.
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Eligibility and other restrictions in LIC’s Single Premium Endowment Plan-
Look here is the eligibility for LIC single premium endowment plan;
- Sum Assured Minimum Rs. 50,000 in multiples of 5000 & Maximum Unlimited \sPolicy Term 10 minimum and 25 maximum years
- Minimum and Maximum Single Premium Payment Term Policyholder Entry Age: Minimum 90 Days and Maximum 65 Years
- Minimum age of 18 years and maximum age of 75 years at maturity
- Payment modes is Only Single
LIC Single Premium Endowment Plan- Same Plans From Other Companies
1. HDFC (Housing Development Finance Corporation) Life Click 2 Invest ULIP (Unit-Linked Insurance Policy)
Many people believe that this is the best single premium endowment plan for LIC available. This is due to the way it combines the benefits of both investing and life insurance. Your investments can be made to their full potential thanks to the way the plan has been created. At the same time, as the plan matures, you also profit financially. If you pass away while still being covered by the policy, the nominees will also receive payments.
Depending on your risk tolerance, you can choose from about eight different fund options. So, if it’s appropriate for you, get this single-premium coverage. When the insurance term expires, the policy provides maturity benefits to you. But you may also redeem it over a five-year period using the Settlement Option. Your designated beneficiary may choose the highest death benefit amount from the fund value, the sum assured, and 105% of the policy premiums paid. After the policy has been in effect for five years, you can also cancel it.
2. Pru Easy Retirement SP from ICICI (Industrial Credit and Investment Corporation of India)
This LIC single premium policy is also excellent. As its name implies, the policy would aid in your effort to accumulate a retirement fund. The best part is that you can do it while still maintaining your level of risk tolerance. The plan provides an additional accrued bonus on top of the minimum promised benefit. Additionally, you can use the top-up feature to add additional funds to the policy whenever you wish.
Therefore, you now know where to go if you’re viewing a LIC single premium plan that enables you to do so. Additionally, there are two types of funds available here: money market & debt and equity & linked securities. One of the major advantages of the plan is the assured benefit, which entitles you to top-ups and 101% of the money assured. Depending on your needs, you can choose between the Easy Retirement Secure Fund and the Easy Retirement SP Balance Fund if you want to raise the sum secured.
LIC Single Premium Endowment Plan- FAQs
- What are the advantages of a single premium endowment plan from LIC?
Answer-This combination provides financial protection against death during the policy term with the provision of payment of lumpsum at the end of the selected policy term in case of his/her survival. Through its credit facility, this plan also addresses the issue of liquidity.
- What is the single premium endowment plan commission for LIC?
Answer-For single-premium plans, the commission is 2%. Commission caps for a normal premium policy remain the same. The maximum commission that can be paid out in the first year is 7.5%; in future years, it’s 2%.
- Can I cancel a single premium endowment plan with LIC?
Answer-Surrender Value: If you decide to cancel the plan, you will receive a portion of the one-time premium you paid. The premium amount without taxes is what the guaranteed surrender value is based on. Values associated with bonuses – The bonus that has been declared for the plan has a surrender value as well.