The Magic of Jeevan Saral An insight into this unique plan of L.I.C. of India

Popular L.I.C. Plans Endowment (with & without profits) Moneyback plans Whole Life Plans (with & without profits) Pension Plans (Immediate & Deferred Annuity) Joint Life Plan Term Assurance Plans…..

Variants & Hybrids Jeevan Mitra - double/triple cover end.plan Jeevan Surabhi - variant of Moneyback Jeevan Anand - Hybrid of End. & W.Life Jeevan Rekha - Hybrid of W.Life & M-back Jeevan Shree - Variant of Lim.Pay.End....

Typical Pattern of these plans Premium Rates are defined per 1000 sum assured One has to decide on sum and term / Premium term. Accordingly the premium for his age is calculated. The contract is for a predetermined period with survival benefits (if any) defined on specified dates. (e.g. 75/20, 14/25, etc.)

Typical Pattern of these plans (cont.) In most typical plans, reversionary bonuses / G.A. and FAB/LA are added to the policy and provided alongwith sum assured on maturity. Surrendering early means losing money. But then that is the only way to liquidate cash. Otherwise raise loan against your policy.

Unit Linked Policies New trend in insurance selling Premium is used for providing risk cover and investment in mutual fund units. Growth comes through appreciation of NAVs. Hence quite dynamic in nature If markets are down NAVs can also have negative growth. Hence risk of losing money too.

Unit Linked Policies (cont.) To effectively grow the money, policyholder must closely watch the trends of the market and keep switching between funds Not many people have the expertise or the inclination to monitor their investments at frequent intervals.

Jeevan Saral - a plan with a difference Jeevan Saral is a unique plan which offers the best features of a conventional plan and a unit linked plan in one product itself

How is it different? Instead of starting with Sum Assured you start by deciding how much premium you want to invest Riskcover is same for all ages for a specific modal premium. i.e. For Rs.5000 p.a. the riskcovered for age 20 as well as age 45 is the same

Salient Features of Jeevan Saral Client has to decide –premium to be paid, and –Mode only He/she can choose any term No surrender penalty after 5 years Participating – loyalty additions after 10 or more years

Salient Features of Jeevan Saral Death Benefit –250 times the monthly premium, plus –return of premiums excluding extra/rider premium and first year premium, plus –the Loyalty Additions, if any. Maturity Benefit –Maturity Sum Assured, plus –the Loyalty Additions, if any.

Unique Feature In case of death claim, in addition to the Sum Assured payable on death, All Premiums Paid, (excluding the first year premium, extra premiums and premiums for rider benefits), will be refunded. This is the first time that such a feature has been introduced. The result is a continuously increasing Risk Cover from the second year onwards.

Is Jeevan Saral a With Profit Plan ? YES. But bonus will not be declared each year as under other plans. Only “Loyalty Addition” will be given after atleast 10 years of premium payments and duration. This Loyalty Addition is payable even when a policy is Surrendered

Paid-up and Surrenders Available after 3 years No Surrender penalty after 5 years. For e.g. if a 20 year is being surrendered after 12 years, it will be treated as if the policy was originally taken for a term of 12 years, and the maturity value corresponding to term 12 will be paid. In this sense, Jeevan Saral can be called a Flexible Term plan.

Another Unique Feature Yes. Jeevan Saral boasts of another fantastic unique feature - Partial Surrender If you need money, you can partially surrender the policy The premium will correspondingly reduce and thereby the associated benefits too. This means that you can virtually break one policy into multiple policies This also means that you can use this policy as a flexible Moneyback Plan.

Another Mega Benefit There is a misconception that Loyalty addition is just a little sweetener and the main growth comes from bonus / G.A. But it will not be so in the case of Jeevan Saral. Actuarial analysis will show that the actual L.A. that can be paid will not be less than the total regular bonus payable on death claim, surrender or maturity. In fact the policy holder will stand to gain more due to this concept

Another Mega Benefit (cont.) Reversionary bonus is declared after assessment of surplus. On this surplus first a tax of 12.5% + 10% surcharge on tax and 2% educational cess, i.e. a total of 14% has to be paid. Thereafter 5% is the government share Then there is also a Solvency Margin provision to be made The remainder is then distributed as bonus to the policy holders

Another Mega Benefit (cont.) Loyalty Additions and Final Addition Bonuses are not based on assessment of surplus. Hence there is NO TAX, NO GOVERNMENT SHARE AND NO SOLVENCY MARGIN PROVISION to be made. The result naturally is substantially higher benefit to the policy holder

Standard Terms of this Plan For a chosen premium, the level of benefits payable at maturity (The Maturity Sum Assured) will be quoted Policyholder can choose term from 10 years to 35 years Modes available – Yearly, Half-yearly, Quarterly & SSS

Eligibility Conditions No LimitMaximum Premium Rs.400/- per monthMinimum premium for entry age 50 years or above The monthly premium should be in multiples of Rs.50/- Rs.250/- per monthMinimum premium for entry age 49 years or below 10 years 35 years Minimum term Maximum term 70 yearsMaximum age at maturity 12 years (completed) 60 years Minimum age at entry Maximum age at entry

Rider Benefits Accident benefit (optional) Term Assurance Rider (optional) Standard Term Assurance and AB rider Sums Assured limits apply The Term Assurance and AB rider Sums Assured will not exceed the Death Beneift Sum Assured

Conditions for Partial Surrender Atleast 3 years premiums are paid Minimum basic annual premium after withdrawal /- where age at entry was 49 years or below and 4800/- where age at entry was 50 years or above Minimum basic annual premium for withdrawal /- Withdrawal in multiples of - 600/- annual premium Minimum waiting period between successive withdrawals - 1year No loan should be o/s on the policy at the time of withdrawal All future benefits and premiums under the policy will get reduced proportionately