LIC’s new plan, Jeevan Utsav, is making waves these days. Launched on November 29, 2023, the Life Insurance Corporation of India (LIC) has become so popular that over one lakh people enrolled within a month. The company claims that this policy not only provides customers with secure returns but also ensures financial stability through periodic income. LIC describes this plan as ideal for those who want both lifetime coverage and a regular income.

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Who can get the Benefit?

Investors between the ages of eight and 65 can invest in the LIC Jeevan Utsav plan. The premium payment period for this policy is limited to a period of five to sixteen years. The returns under the plan depend on the policyholder’s investment period. The minimum sum assured in this plan is set at Rs. 5 lakh. The policy offers two payout options: regular income and flexi income. This scheme offers the combined benefits of term and life insurance, providing the policyholder with coverage for their entire life, not just a limited period.

How this policy works

According to LIC, 10% of the sum assured chosen by the policyholder begins to be paid from the 11th policy year, based on the specified term. For example, if a customer chooses a sum assured of ₹16 lakh with a premium term of 16 years, but only pays premiums for five years, they will still receive all the risk and survival benefits. The benefit is calculated based on the premiums paid. For example, if premiums have been paid for five out of 16 years, the sum assured will be calculated as ₹5 lakh, based on 16 times 5 divided by 16. The same rule applies to policies with a sum assured of less than ₹5 lakh.

If a person pays premiums for five to eight years, their income begins from the 11th year. Customers who choose a longer payment term of ten years receive income starting in the 13th year. This plan functions like a money-back policy, where income is received periodically instead of a lump sum.

Interest Rate and Income Benefits

Investors in this plan receive an annual interest rate equivalent to approximately 5.5 per cent. This interest payment is based on the deferred option and the remaining portion. By choosing the Flexi Income option, investors can receive up to ten per cent income at the end of each year. This is useful for those who want a regular income at regular intervals and want to make their earnings a stable financial source.

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Special Benefits for the Family of the Deceased

The death benefit in the Jeevan Utsav policy is also considered attractive and beneficial. If the policyholder dies during the policy term, the nominee can continue to receive additional income along with the sum assured. This additional payment can be around ₹40,000 annually. Thus, the family can receive a return of up to seven times the annual premium. This feature makes this plan more useful than other policies, as it provides financial security to the family even in unforeseen situations.