LIC Nivesh Plus Policy: A Complete Guide
Table of Contents
Nivesh Plus- An Overview
LIC Nivesh Plus 849 is a unit-linked insurance plan (ULIP) that merges the advantages of life insurance with an investment component. Offered by the LIC of India, this plan enables policyholders to invest their premiums in various funds according to their risk tolerance, offering the potential for capital growth over time. Additionally, the policyholder can choose the sum assured at the time of purchasing the policy. There are four types of investment funds available, allowing policyholders to select the one that best aligns with their convenience and risk appetite. The funds offered are:
- Bond Fund
- Secured Fund
- Balanced Fund
- Growth Fund
Eligibility Criteria
- Entry Age: Minimum: 90 days, Maximum: 70 years
- Maturity Age: Maximum: 85 years
- Policy Term: 10 to 25 years
- Sum Assured: Minimum: 1.25 times Single Premium for ages below 55, and 1.10 times Single Premium for ages 55 and above.
Benefits
- Death Benefit:
- In case of death during the policy term, the nominee receives the higher of the Basic Sum Assured, the Fund Value, or 105% of the total premiums paid.
- Maturity Benefit:
- On surviving the policy term, the policyholder receives the Fund Value based on the prevailing NAVs.
- Investment Options:
- Choose from four fund options: Bond Fund, Secured Fund, Balanced Fund, and Growth Fund.
- Partial Withdrawals:
- Available after five policy years, up to a certain limit.
- Switching of Funds:
- Flexibility to switch between different funds as per the policyholder’s requirements.
Sample Premium Illustration
Let’s consider a 30-year-old policyholder investing a single premium of ₹1,00,000 in the LIC Nivesh Plus policy with a policy term of 20 years.
| Year | Fund Value @ 4% | Fund Value @ 8% |
|---|---|---|
| 1 | ₹1,02,500 | ₹1,05,000 |
| 5 | ₹1,12,550 | ₹1,46,933 |
| 10 | ₹1,23,822 | ₹2,06,099 |
| 15 | ₹1,36,428 | ₹2,89,195 |
| 20 | ₹1,50,495 | ₹4,07,441 |
Documents Required
- Identity Proof: Aadhar Card, Passport, Voter ID, etc.
- Address Proof: Utility Bills, Bank Statement, Rental Agreement, etc.
- Age Proof: Birth Certificate, School Leaving Certificate, etc.
- Photographs: Recent passport-sized photographs.
- Income Proof: Salary Slips, Income Tax Returns, etc.
Investment of Fund
- Bond Fund: Investments predominantly in government securities.
- Secured Fund: Investments in government securities, corporate bonds, and money market instruments.
- Balanced Fund: Investments in equities, corporate bonds, and government securities.
- Growth Fund: Investments primarily in equities for capital growth.
The four fund types are available under the policy. As per the fund option selected by the policyholder, the allocated premium is used to buy the units. The various types of fund and investment patterns are as follows.
| Fund Type | Investment in Government/ Government Guaranteed Securities/ Corporate Debts | Short-term investments such as money market instruments | Investment in Listed Equity Shares | Objective | Risk Profile |
|---|---|---|---|---|---|
| Bond Fund | 60% to 100% | 0% to 40% | NIL | To provide a relatively safe and less volatile investment option (investmenfixed-income securities)
| Low Risk |
| Secured Fund | 45% to 85% | 0% to 40% | 15% to 55% | To provide steady income (investment in both equities and fixed-income securities) | Lower to Medium Risk |
| Balanced Fund | 30% to 70% | 0% to 40% | 30% to 70% | To provide balanced income and growth (similar proportion investment in equitiesfixed-income securities)
| Medium Risk |
| Growth Fund | 20% to 60% | 0% to 40% | 40% to 80% | To provide long-term capital growth (investment primarily in equities) | High Risk |
* All the data has been provided from the official LIC sources.
What is Not Covered
- Suicide: If the policyholder commits suicide within 12 months from the commencement of the policy, only the fund value as on the date of death will be payable.
- Exclusions in Riders: Certain riders may have specific exclusions which need to be reviewed in the rider documentation.
- Pre-existing Conditions: Some pre-existing health conditions may not be covered under the policy benefits.
Conclusion
The LIC Nivesh Plus policy offers a blend of insurance protection and investment opportunities, making it a suitable choice for individuals looking to secure their financial future while participating in market-linked returns. By understanding the eligibility, benefits, premium structure, required documents, fund investments, and exclusions, policyholders can make an informed decision to align the policy with their financial goals.