Jeevan Azad

 Jeevan Azad

If a policy-seeker wants to purchase an insurance plan that offers a combination of savings and protection, he/she can keep LIC’s Jeevan Azad plan on the bucket list. Life Insurance Corporation of India recently launched the Jeevan Azad plan in January, a limited premium payment endowment plan. This plan not only takes care of the liquidity needs of the family through the loan facility but also offers financial help to the family of the life assured in case of an unfortunate and untimely demise of the life assured during the policy term of an active policy.

Apart from that, if the life assured survives the policy term and keeps the policy active, he/she is entitled to avail of a lumpsum amount as a maturity benefit. LIC has kept its door open for both online and offline buyers. If a policy-seeker is more comfortable with the offline method or buying, he/she can purchase the plan through licensed agents, corporate agents, brokers, insurance marketing firms, Point of Sales Persons-Life Insurance (POSP-LI), and Common Public Service Centers (CPSC-SPV).

The followings are the basic specification of the plan:

Eligibility Criteria

Key Benefits of LIC'S Jeevan Azad Policy

This plan offers the life assured and his/her family multiple benefits to provide maximum financial protection and security. Those benefits are discussed below.

Death Benefit:

The death benefit is payable after the date of commencement of risk but before the maturity date on the death of the life assured during the policy term of an active policy. The death benefit is equal to the sum assured on death which is higher of the followings.

• Basic Sum Assured
• 7 times of Annualized Premium.

This Death Benefit shall not be less than 105% of the Total Premiums Paid up to the date of death.

Death benefit in case of a minor:

In case of a minor Life Assured, whose age at entry is below 8 years, on death before the commencement of risk, the Death Benefit payable will be a refund of premium(s) paid, excluding taxes, extra premium, and rider premium(s), if any), without interest.

Maturity Benefit:

If the life assured survives the stipulated date of maturity, Sum Assured on Maturity will be paid to him/her, which is equal to Basic Sum Assured.

Rebates:

The rebates will be as per the following tables:

Paid-up Value:

If the life assured pays at least two full years’ premiums and any subsequent premiums are not duly paid, this policy will not be wholly void, rather it will be called a paid-up policy till the end of the policy term. Under this policy, the death paid-up sum assured on death, and maturity paid-up sum assured on maturity will be payable. The rider will not acquire any paid-up value and the rider benefits cease to apply if policy is in lapsed condition. 

Loan Facility:

This policy has come up with the loan facility under the following terms and conditions:

•At least two years’ full premiums have to be paid.

•The maximum loan for an in-force policy will be 90%. For a paid-up policy, it will be 80%.

•A certain rate of interest will be applicable for availing of the loan facility. 

Any outstanding loan, along with interest, will be recovered from the claim proceeds at the exit time.

Surrender Benefit:

The policy can be surrendered by the policyholder at any time during the policy term, provided two full years’ premiums have been paid. On surrender of the policy, the Corporation will pay the Surrender Value equal to the higher Guaranteed Surrender Value or Special Surrender Value.

Optional Benefits of LIC'S Jeevan Azad

There are several options available with this policy which have made the policy more convenient for the customers. Those options are as follows.

Optional Riders:

To strengthen the policy, one can opt for the following riders by paying a little extra premium.

•LIC’s Accidental Death and Disability Benefit Rider

•LIC’s Accident Benefit Rider

•LIC’s Premium Waiver Benefit Rider

However, the policyholder can opt between either of the LIC’s Accidental Death and Disability Benefit Rider or LIC’s Accident Benefit Rider and/or LIC’s Premium Waiver Benefit Rider subject to the eligibility.

Settlement option for maturity and death benefit:

One can receive the maturity and death benefit in installment over a period of 5 years instead of lumpsum amount for both an in-force and paid-up policy. The minimum installement amount will be as per the following table:

What are the key exclusions of LIC'S Jeevan Azad?

The general exclusions of LIC’s Jeevan Azad are as follows:

•Anything that does not fulfil the terms and conditions of the policy fall under the category of exclusions.

•Any kind of breach of law, intentionally or unintentionally, is permanently excluded from the policy.

•If the Life Assured (whether sane or insane) commits suicide at any time within 12 months from the date of commencement of risk, the nominee or beneficiary of the Life Assured will be entitled to 80% of the total premiums paid, excluding any taxes, extra premium, and rider premiums, if any, provided the policy is in-force. This clause will not be applicable in case the age at entry of the Life Assured is below 8 years.

•If the Life Assured commits suicide within 12 months from the date of revival, an amount which is higher than 80% of the total premiums paid till the date of death, or the surrender value available as on the date of death, will be payable. The nominee or beneficiary of the Life Assured shall not be entitled to any other claim under the policy. This clause is not applicable for a minor life assured and for a policy lapsed without acquiring paid-up value.

Sample Illustrative Premium of LIC'S Jeevan Azad

The sample illustrative annual premiums for Basic Sum Assured (BSA) of Rs. 2 lakhs for Standard lives for policies to be sold through Offline (Without CIS) are as under:

LIC'S Jeevan Azad With an Example

To make it more understandable and simpler, here is an example of LIC’s Jeevan Azad Plan.

Mr. Agarwal, a 35-year-old businessman, purchased this plan for himself. Let us find out how much premium amount he has to pay for the given details