Is LIC Endowment Plan A Good Choice?
Updated On Jun 15, 2021
Table of Contents
Endowment plans are a great way of investing and saving your earnings for the future. It provides cover from compromising situations in life and helps you contribute to your financial security and stability. There are several insurance companies that have brought out their endowment plans. The LIC Endowment Plan is one such endowment plan.
The LIC Endowment Plan is a participating and non-linked plan. By putting down a regular amount from your current earnings, you can get protection from it. There are liquidity facilities available as well. To determine whether it is a good choice, take a look at what it has to offer.
Benefits Available under LIC Endowment Plan
The key feature of an endowment plan is the benefits that it offers. The following are the various types of benefits that are available under the LIC Endowment Plan.
The death benefit is paid out to the nominees of the policyholder in case the policyholder dies during the policy term, that is, before the end of it. The benefit comprises the Sum Assured on Death, the simple reversionary bonuses applicable and any other bonus applicable to the endowment plan.
The Sum Assured on Death is ten times the annualised premium or is higher than the Basic Sum Assured under the plan. The death benefit is a substantial amount to help out loved ones left behind and is not less than 105% of all premiums paid till the day of death of the insured.
The maturity benefit is paid if the policyholder survives till the end of the policy term. Once the plan matures, an amount consists of the Sum Assured, simple reversionary bonuses and final bonuses are given out. It is paid out in lump sum, only on the condition that all premiums have been paid till the date of maturity.
Optional Rider Benefit
The LIC Endowment Plan offers the choice of adding the LIC’s Accidental Death and Disability Benefit Rider to the base endowment plan. It covers the accidental death and/or disability of the policyholder. It is a beneficial rider as these contingencies can incur huge expenses. In case of accidental death, the Rider Sum Assured is payable, as lump sum, along with the death benefit under the basic endowment plan.
In case of accidental permanent disability due to an accident, the Accident Benefit Sum Assured is paid in equal monthly instalments over a span of 10 years. All withstanding premiums for this Rider as well as premiums for the portion of the Basic Sum Assured which is equal to Accident Benefit Sum Assured are waived. This is subject to the fact that the disability occurs within 180 days of the accident.
With such benefits and facilities, it can be considered that the LIC Endowment Plan is a good choice. However, the ultimate decision may differ from one policyholder to another according to their own aims regarding their finances.
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.