LIC Yuva Term Plan 875
LICs Yuva Term is a Non-Par, Non-Linked, Life, Individual, Pure Risk Plan, which provides financial protection to the insureds family in case of his/her unfortunate death during the policy term.
Description
The LIC Yuva Term Plan is a specialized term insurance plan launched by the Life Insurance Corporation of India (LIC), designed specifically for young individuals. It is a non-linked, non-participating pure protection plan. The plan offers financial security to the policyholders family in case of the unfortunate demise of the insured, while also ensuring affordability and a higher sum assured due to the early age of entry.
While the LIC Yuva Term Plan offers pure risk coverage, meaning there is no maturity benefit, its primary purpose is to provide high-value protection at a comparatively lower premium for the youth demographic.
Key Features
- Pure Term Plan: No maturity benefit, focusing on providing high life coverage at affordable rates.
- Financial Security: Provides substantial financial cover to the family of the insured in case of untimely death.
- Young Entry Benefit: Aimed at young individuals, which ensures lower premiums and maximum insurance cover.
- Optional Riders: Can include riders like Accidental Death and Disability Benefit, enhancing protection.
- Flexible Premium Payment: Offers multiple premium payment options to suit different financial planning strategies.
Eligibility Criteria
Since the LIC Yuva Term Plan is a new generation plan, the entry age and conditions cater to young individuals:
- Minimum Entry Age: 18 years.
- Maximum Entry Age: 35 years.
- Minimum Policy Term: 10 years.
- Maximum Policy Term: 40 years.
- Maximum Maturity Age: 75 years.
- Minimum Sum Assured: ₹25 lakhs.
- Maximum Sum Assured: No upper limit (subject to underwriting and terms).
- Premium Payment Mode: Yearly, Half-yearly, Quarterly, or Monthly.
Benefits:
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Death Benefit
- In case of the unfortunate death of the policyholder during the policy term, the nominee will receive the Sum Assured on Death. The Sum Assured on Death will be:
- 10 times the annualized premium, or
- 105% of all premiums paid up to the date of death, or
- The Basic Sum Assured.
- The death benefit provides a financial cushion for the insureds family to help cope with the loss of income.
- In case of the unfortunate death of the policyholder during the policy term, the nominee will receive the Sum Assured on Death. The Sum Assured on Death will be:
-
Affordable Premiums for Youth
- Since the plan targets young individuals, the premium rates are lower compared to term plans taken later in life. This makes the plan ideal for securing financial coverage early at affordable rates.
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High Insurance Cover
- Given that the sum assured starts at ₹25 lakhs and can go much higher, it is suitable for those who wish to ensure their familys financial security for the long term.
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Flexible Premium Payment
- The plan offers flexible premium payment options, allowing individuals to choose from regular, limited, or single premium modes based on their financial ability.
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Optional Riders
- Accidental Death Benefit Rider: Offers an additional payout in case the policyholder dies in an accident.
- Disability Benefit Rider: Provides a payout in case of permanent disability due to an accident.
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Grace Period
- A grace period of 30 days is allowed for payment of premiums in yearly, half-yearly, or quarterly modes, and 15 days for the monthly mode. This ensures that the policy does not lapse immediately due to a missed payment.
Premium and Sum Assured Example
Below is an example of how premiums work for a 30-year-old male with a Basic Sum Assured of ₹50,00,000 for a 20-year policy term.
Age | Policy Term | Sum Assured | Premium (Annual) | Death Benefit |
---|---|---|---|---|
30 | 20 years | ₹50,00,000 | ₹7,500 | ₹50,00,000 |
25 | 30 years | ₹50,00,000 | ₹6,500 | ₹50,00,000 |
35 | 15 years | ₹50,00,000 | ₹8,500 | ₹50,00,000 |
Example of Death Benefit
- Policyholder Age: 25 years.
- Policy Term: 30 years.
- Sum Assured: ₹1 crore.
- Premium Payment: ₹13,000 per year (approximate).
In case of death of the policyholder during the policy term, the nominee will receive ₹1 crore as the death benefit.
Riders (Optional)
- Accidental Death and Disability Rider: This rider provides an additional amount in case the policyholder dies or becomes disabled due to an accident.
- Critical Illness Rider: Offers a lump sum benefit if the insured is diagnosed with certain critical illnesses (if opted for).
Advantages
- Early Start: The plan targets young individuals, ensuring that they can avail of high coverage at lower premiums.
- Financial Protection: Provides adequate financial security to the family in case of the untimely demise of the policyholder.
- Riders for Enhanced Protection: The plan comes with additional rider options to cover accidents and disabilities.
Disadvantages
- No Maturity Benefit: Since it is a pure term plan, no benefits are paid on survival till the end of the policy term.
- Premium Increases with Age: If the policyholder delays purchasing the plan, the premiums will increase with age.
Conclusio
The LIC Yuva Term Plan is ideal for young individuals looking for high life cover at affordable rates. With the flexibility of choosing terms and payment modes, it helps safeguard a familys future financial needs. Although it does not provide any maturity benefit, the large coverage amount ensures that the family is financially secure in case of the policyholders unfortunate demise.