What is sum assured in LIC?
Asked by: Lawrence Sawayn III | Last update: April 19, 2023Score: 4.6/5 (72 votes)
A sum assured is a fixed amount that is paid to the nominee of the plan in the unfortunate event of the policyholder's demise. The insurance company pays this money as per the sum chosen by you at the time of purchasing the policy.
How is sum assured calculated in LIC?
For single premium policies : “Sum Assured on Death” shall be payable which is defined as higher of 125% of single premium (excluding the taxes and extra premium, if any) or absolute amount assured to be paid on death where absolute amount assured to be paid on death is Sum Assured.
What is difference between sum assured and maturity amount in LIC?
The sum assured refers to the amount guaranteed by an insurance policy whereas maturity value refers to the amount paid by an insurance company to the policy holder on maturity of the said policy.
Do we get sum assured on maturity of LIC?
Maturity Benefit:
On the life assured surviving to the end of the policy term, provided all due premiums have been paid, “Sum Assured on Maturity” along with vested Simple Reversionary Bonuses (as mentioned in 2 below) and Final Additional bonus, if any, shall be payable.
What is the difference between sum assured and premium amount?
A simple summary of the sum insured is money (Coverage) that we will receive from life insurance companies. The insurance premium is the money we must pay to life insurance companies.
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Is sum assured and guaranteed benefit?
Now, in traditional plans, sum assured usually means the minimum guaranteed amount payable on maturity. But as for death benefits they are paid as higher of the sum assured or 10 times the annual premium if you are below 45 years, or 105% of the premiums paid till date.
How much LIC will I get after maturity?
Maturity Benefit: In case of Life Assured surviving the stipulated date of maturity, 40% of the Basic Sum Assured along with vested Simple Reversionary Bonuses and Final Additional Bonus, if any, shall be payable.
What is sum assured bonus in LIC?
Bonus is declared either as a certain amount per Rs 1,000 sum assured or as a percentage of the sum assured. For example, bonus may be Rs 40 for every Rs 1,000 of the sum assured. So, for a policy with the sum assured of Rs 1 lakh, the bonus amount will be Rs 4,000.
Why sum assured is less than total premium?
As per the above table, it is clear that premium for lesser term is more than that for higher term and total premium to be paid not to be confused with sum assured as it is minimum amount to paid to nominee in case of death of policy holder even single premium has been paid.
How much sum assured is enough?
Typically, a rule of thumb is your sum assured should be 10 times your annual income. For younger individuals less than 30 years of age, sum assured 14-15 times of their annual income and for those who are older above 50 years, 7-8 times works well.
What is the difference between sum insured and sum assured?
Sum insured is the value applied to Non-life insurance. Sum assured is the value applied to Life insurance policies. It basically is based on the principle of indemnity, that provides a reimbursement/ compensation to damage/loss. It is that fixed amount that the insurer pays the policyholder in case of an eventuality.
What is maximum sum assured?
The sum assured depends upon the income of the person and typically a maximum of up to 10 times the annual income is allowed as the sum assured.
Is it good to surrender LIC policy?
Surrender value is payable only after three full years premiums are paid to LIC. More over if it is a participating policy the Bonus get attached to it as per prevalent rules. Surrender of policy is not recommended since the surrender value would always be proportionately low.
What happens if I stop paying LIC premium after 5 years?
The contract between the insurer and insured is voided, the life-insurance element will cease to exist once the policyholder has surrendered their policy. Thus any benefits before available will no longer be valid.
How much I LIC bonus is calculated?
Bonus is declared either as a certain amount per Rs 1,000 sum assured or as a percentage of the sum assured. For example, bonus may be Rs 40 for every Rs 1,000 of the sum assured. So, for a policy with the sum assured of Rs 1 lakh, the bonus amount will be Rs 4,000.
How can I check my LIC policy bonus?
To know about the LIC policy bonus, the LIC policyholder needs to send the SMS in the format 'ASKLIC BONUS' on the same number. Likewise, for asking the details about the information on loan against LIC policy or nominee, one need to send SMS in the format 'ASKLIC Loan' and 'ASKLIC NOM' respectively.
Can I withdraw LIC bonus?
This means that you have to have held the policy for a minimum timeframe of three years before you can surrender it. Once you have surrendered your LIC policy, the insurer will provide you with a portion of money known as 'accumulated bonus' along with the premiums that you have paid for that period of time.
Which LIC plan has highest return?
- LIC Jeevan Akshay VI.
- LIC New Children's Money Back Plan.
- LIC New Endowment Plan.
- LIC's Accidental Death and Disability Rider:
How can I double my LIC money?
- LIC MF Large Cap Fund. LIC MF Large Cap Fund has given 16.3 percent CAGR return in 5 years. ...
- LIC MF Tax Plan. ...
- LIC MF ETF- Nifty 50. ...
- LIC MF Large & Mid Cap Fund. ...
- LIC MF ETF – Sensex.
Is sum assured same as death benefit?
Sum assured is the money that the insurer pays in case the insured event takes place. So, in the case of a term policy on death of the policyholder, the beneficiary gets the sum assured. Under a term policy there is no difference between the death benefit and the sum assured.
Can I withdraw LIC before maturity?
When you opt out of a policy before its maturity, it is called surrendering the policy. The amount that you receive at the time is the LIC policy surrender value. The life cover stops immediately and you won't be able to revive it in the future.
How much money will I get if I surrender my LIC policy after 3 years?
A policyholder can surrender his/her policy only after the completion of 3 years, i.e. the policy has to have been in force for a period of 3 years, at least. The surrender value provided by LIC is essentially 30% of the premiums that have been paid so far.
How much amount we will get if we surrender LIC policy?
The policy can be surrendered anytime provided two full years' premiums have been paid. On surrendering after two policy years, the insurance company will pay a guaranteed surrender value of minimum 30% of all premiums paid after deducting the first year's premium.
What is initial sum assured?
Sum assured is a pre-defined sum that the insurance company agrees to pay to you or your nominee if the insured event happens or at the end of the insurance term. The sum assured in insurance is determined at the time of policy purchase. It remains unchanged throughout the policy period.