Understanding Jeevan Lakshya
LIC’s Jeevan Lakshya is one of the best available life insurance plan, that provides The best life insurance plan varies according to individual needs. However, a plan that offers multiple risk coverages with decent returns can treated as optimal. Typically, traditional life insurance policies consist of two main components; 1. Risk Coverage, and 2. Savings.
Risk coverage refers to the sum assured payable to the beneficiaries in case of the policyholder’s death. The savings part of the life insurance policy accumulates cash value over time payable to the policyholder upon maturity.
Normally, the risk coverage under life insurance policies provides a one-time settlement. In the event of the policyholder’s death, the beneficiary will get the sum assured and accrued bonuses (if any).
The primary purpose of life insurance is to provide financial security for dependents and meet their future financial needs. Therefore, a one-time settlement may not be sufficient for dependants to meet their future needs, particularly non-earning ones. They often require a regular income stream to cover future expenses, such as:
- Livelihood expenses
- Children’s education
- Caregiving for aging parents
In this context, a life insurance policy that offers regular income for dependants on the policyholder’s death is more beneficial. This ensures a steady financial support system. Certain life insurance plans address this concept. ‘Jeevan Lakshya’, offered by the Life Insurance Corporation of India (LIC) is a notable plan. This plan provides multiple benefits to the beneficiaries in terms of risk coverage. In addition to that, it also provides a reasonable payout at maturity. By adding a simple rider to this plan, policyholders can enhance its benefits and fully experience the true essence of life insurance. Jeevan Lakshya is an affordable plan, that provides financial security and peace of mind for you and your loved ones.
Let’s take a closer look with a detailed presentation and examples.
Benefits of LIC’s Jeevan Lakshya
The benefits payable under LIC’s Jeevan Lakshya policy in different circumstances are outlined below.
| Event | Benefits Payable |
| On maturity: | The policyholder is eligible to receive: 1. Basic sum assured along with bonus and final additional bonus (if any) |
| On Death | The nominee is eligible to receive the following benefits: 1. 10% of the basic sum assured per year till the end of the policy term. 2. 110% of basic sum assured along with bonus and final additional bonus (if any). |
| On Death (if Term rider opted) | The nominee is eligible to receive the following benefits: 1. Basic sum assured. 2. 10% of the basic sum assured per year till the end of the policy term. 3. 110% of basic sum assured along with bonus and final additional bonus (if any). |
| On Accidental Death (if AB rider opted) | The nominee is eligible to receive the following benefits: 1. Basic sum assured. 2. 10% of the basic sum assured per year till maturity. 3. 110% of basic sum assured along with bonus and final additional bonus (if any) |
| On Disability (if ADDB rider opted) | The Policyholder is eligible to receive the following benefits: 1. Waiver of future premium 2. Guaranteed monthly income for 10 years, commencing from the date of disability. 3. Basic sum assured along with bonus and final additional bonus (if any) |
Key features of LIC’s Jeevan Lakshya
- Limited premium payment term (policy term minus 3 years).
- High insurance protection compared to other endowment-type policies.
- A highly effective insurance plan for individuals with non-earning dependents.
- Built-in Premium Waiver Benefit feature.
- Loan facility
- Option to receive maturity or death benefits in instalments.
- Guaranteed maturity returns even after the death of the policyholder.
- Tax benefits as per Sec. 80C of the Indian Income Tax Act.
- Tax benefits as per Sec. 10(10D) of the Indian Income Tax Act.
Jeevan Lakshya (Plan 933) – Eligibility Conditions
| Condition | Minimum | Maximum |
| Age at entry | 18 years (last birthday) | 50 years (nearer birthday) |
| Policy term | 13 years | 25 Years |
| Premium paying term | Term – 3 | |
| Basic Sum Assured | Rs. 1,00,000 | No upper limit |
Jeevan Lakshya (Plan 933) – Rebates and Add-ons
| Mode Rebate | Yearly | 2% of tabular premium |
| Half-yearly | 1 % of Tabular premium | |
| Quarterly and Monthly | No rebate | |
| High Sum Assured rebate | 2,00,000 to 4,90,000 | 2 per 1000 sum assured |
| 5,00,000 and above | 3 per 1000 sum assured | |
| Applicable riders | 1. Accident benefit rider 2. Accidental death and disability rider 3. Term Assurance rider 4. Critical illness benefit rider | |
LIC’s Jeevan Lakshya: Sample Presentation
Mr Rajiv has chosen LIC’s Jeevan Lakshya plan, with the following details:
Let’s outline how the policy will work in his case.
| Age | 35 years | |
| Policy Term | 21 years | |
| Premium Paying Term | 18 years | |
| Sum Assured | 10 Lakhs | |
| Riders Opted | 1. Accidental death and disability rider 2. Term Assurance rider | |
| Premium | First Year | From Second Year |
| Yearly ₹ 59,757/- Half Yearly ₹ 30,194/- Quarterly ₹ 15,254/- Monthly ₹ 5,085/- | Yearly ₹ 58,471/- Half Yearly ₹ 29,544/- Quarterly ₹ 14,925/- Monthly ₹ 4,975/- | |
Benefits Payable under LIC’s Jeevan Lakshya in Different Scenarios:
Scenario 1: Maturity
Upon surviving the policy term, Mr. Rajiv will receive a maturity benefit of ₹20,66,000.
Scenario 2: Normal Death
If Mr. Rajiv passes away during the fifth year of the policy:
- Immediate payment of ₹10,00,000.
- ₹1,00,000 annually on every policy anniversary until the end of the policy term.
- ₹21,60,000 at the end of the policy term (maturity).
Scenario 3: Accidental Death
If Mr. Rajiv passes away due to an accident during the fifth year of the policy, his nominee is eligible to receive the following benefits:
- Immediate payment of ₹20,00,000.
- ₹1,00,000 annually on every policy anniversary until the end of the policy term.
- ₹21,60,000 at the end of the policy term (maturity).
Scenario 4: Accidental Disability
If Mr. Rajiv becomes disabled due to an accident five years after the date of commencement, He is eligible to receive the following benefits:
- Monthly income of ₹8,333 for 10 years.
- ₹21,60,000 at the end of the policy term (maturity).
Conclusion:
LIC’s Jeevan Lakshya is an excellent life insurance plan that provides valuable protection. If you are considering an endowment-type insurance plan, Jeevan Lakshya is highly recommended. To maximise your coverage, consider adding the Accidental Death and Disability Benefit rider and a Term Assurance rider equivalent to the Basic Sum Assured. These two riders are highly beneficial, so be sure to include them.
Disclaimer:
The benefits mentioned above are calculated based on a bonus rate of ₹46 per ₹1,000 sum assured. (Bonus Rate 2020-2021). Actual bonuses may vary based on LIC’s future performance.n LIC’s annual performance.
