LIC Market Plus policy Review
Plan no – 181
Lic Market plus plan was Introduced on 05/07/2006 and Withdrawn on 01/04/2008.
Market plus plan is a unit linked plan. Market plus policy is without Critical illness rider. Premium allocation charge is reduced for both single premium and regular premium policies. Charges will be recovered in first year only instead of 1st and 2nd year as in future plus, from 3rd year allocation rate have remained same.
Lock-in-period is of 3 years. i.e policy can be surrendered only after completion of 3 years from date of commencement . No flat fee, no policy charge. Both have merged in policy administrative charges. When policy get surrendered, no surrender charge will be recovered. Auto cover will be available only for 2 years, if premiums have been paid for 3 years and not for unlimited period. If premiums have discontinued , then the revival of policy should be done within 2 years from FUP (First Unpaid Premium) only. Otherwise policy will be compulsorily surrendered. No partial surrender value is available. Restriction on maximum sum assured.
Lic Market Plus Plan Parameters
Entry age :
Minimum: 18 years completed
Maximum: 70 years, if without life cover
65 years, if with life cover
Age at vesting:
Minimum: 40 years LBD (Last birthday)
Maximum: 75 years LBD (Last birthday)
Minimum Deferment period: 5
Mode of payment: Yearly, half-yearly, Quarterly, single premium.
Minimum: Rs. 5000/- per annum for regular premium
Rs. 10000/- for single premium
Maximum: No limit.
Sum assured: No rebate
Mode rebate: No rebate
Minimum sum assured – without life cover: NIL.
Minimum sum assured – with life cover:
|Regular premium policies like yearly, half yearly, Quarterly||Rs. 50,000/-|
|Single premium policies||Rs. 25,000/-|
Maximum sum assured:
|Regular premium policies||20 times of annualized premium (1 yearly, 2 halfyearly, 4 quarterly)|
|Single premium policies||Equal to single premium|
Lic Market Plus Plan Benefits
Maturity Benefits: Benefits on Vesting
On Survival of the Life assured or Policyholder till the maturity date, where premiums have been fully paid or where premiums for last 2 years have not been paid and policy is not compulsorily surrendered, then
Maturity Benefit = Sum equal to Policyholders Fund value.
Under Market Plus policy, the policyholder have to intimate his/ her choice of annuity option to the Corporation, 6 months prior to the vesting date. The policyholder will have an option to commute up to one-third of the Fund Value of the units held in the Policyholder’s Unit Account which shall be paid as a lump sum.
There will also be an option to purchase pension from any other insurance company. But the policyholder will have to inform LIC 6 months prior to the vesting date. Then, in such case Lic will send cheque directly to the concerned company.
If in case the amount of bid value at the vesting date is insufficient to purchase the minimum amount of pension allowed by LIC, then the balance in the Policyholder’s Unit Account at the vesting date shall be refunded to the Policyholder.
On Death of life assured or Policyholder within deferment period with life over,
Death Benefit = Sum assured under Basic plan + Fund value of units held in policyholder’s unit Account.
Benefit may be got in lump sum or in the form of pension.
If policy is taken without life cover, then
Death Benefit = Fund value of units held in policyholder’s unit Account either in lump sum or in the form of pension.
If policy is in lapsed condition and premiums have been paid for less than 3 years, then
Death Benefit = Fund value of the units held in the policyholder’s fund as on date of intimation of death.
Options under Lic’s Market Plus Plan
Eligibility conditions for Accident Benefit:
Accident Benefit can be availed as an optional Rider benefit by paying an additional premium of Rs.0.50 for every Rs.1,000/- of the Accident Benefit Sum Assured per policy year. This benefit will be available only if the policy taken is with Life Cover i.e., Accident Benefit rider will not be available if the policy taken is without Life Cover.
If policyholder is employed in any high risk jobs like police organization and he wish to have DAB (Double Accident Benefit) with police duty, then the premium rate for DAB will be Rs. 1.00 per 1000 sum assured.
|Sum assured||Minimum : Rs. 25,000|
Maximum : Rs. 50,00,000 subjected to all policies taken
together.Age at entryMinimum : 18 years completed
Maximum : 65 years nearer birthday.Age up to which DAB can be availableMaximum : 70 yearsPolicy Term5 to 70 yearsSum assured in multipleRs. 5000/-
Other benefits of Lic Market Plus Plan
- Investment Fund Types:
Four types of funds are available under Lic’s Future plus plan. The policyholder will have the option to choose any one of the below funds. NAV (Net Asset Value) will be computed on daily basis. For Lic Market Plus Plan NAV is fixed for first one month at the rate of Rs. 10/- per unit.
|MARKET PLUS (181)||Launch Date: 05/07/2006|
- Allocation of premium:
Total premium received is divided into unit fund and non-unit fund.
This allocation is done as per percentage given under single and regular premium policies.
The unit fund premium is utilized for arriving at the no. of units by dividing it by the applicable NAV rate. No. of units are to be rounded off up to 3 decimals.
Further, unit capital will be always 10 times of the number of units. The difference between NAV and face value of the unit i.e Rs.10/- will be credited /debited to unit capital premium A/c.
|Premium band||Allocation rate|
|For all premium bands||3.3%|
Regular Premium: Yearly, Half yearly, Quarterly
|Premium Band (per annum)||Allocation charge for policyholder||Allocation charge for CEIS|
|First Year||Thereafter||First Year||Thereafter|
|5,000 to 75,000||16.50%||2.50%||4.00%||0%|
|75,001 to 1,50,000||15.75%||2.50%||3.25%||0%|
|1,50,001 to 3,00,000||15.00%||2.50%||2.50%||0%|
|3,00,001 to 5,00,000||14.25%||2.50%||1.75%||0%|
|5,00,001 and above||13.50%||2.50%||1.00%||0%|
- Top up premium:
The policyholder can pay Top-up or additional premium in multiples of Rs.1,000/- without any limit at anytime during the policy term. In case of half-yearly, yearly or quarterly mode of premium payment such Top-up can be paid only if all due premiums have been paid.
- Recovery of charges and frequency of charges:
Total number of units available in policyholders unit capital account will be calculated after receipt of premium and further deduction of allocation charge from balance amount.
Sum of all charges should not be deducted, but number of units will be deducted from allocated amount. Total no. of units to be deducted will be calculated as,
= Total amount of Following charges
Applicable NAV rates as per time applicable (to be calculated up to 3 decimals)
Charges under Lic Market Plus Plan
Mortality (life cover) charge:
Mortality (life cover) charges will be taken every month by cancelling appropriate no. of units out of policyholders’ unit account as per rate given in Annexure.
Charges for Morality will be based on the life insured’s age as at the policy anniversary coinciding with or immediately preceding the due date of cancellation of units. Hence charges for life cover will increase every year. Life cover charge will be always on SA (Sum Assured).
Accident Benefit Charges:
Rate of accident benefit is on yearly basis. If accident benefit cover is opted for, 0.50 paise per 1000/- SA of accident benefit per policy year will be deducted by cancelling no. of units from policyholders’ unit account on monthly basis.
Policy Administration charges:
Policy administration charges of 60/- per month during the 1st policy term and 20/- per month from 2nd policy years throughout the policy term will be deducted by cancelling no. of units from policyholders’ unit account.
Service tax charge:
Service Tax will be charged on the Life cover, Accident Benefit & critical illness rider if any and the same will be deducted on monthly basis by cancelling appropriate units from the policyholders’ unit account. For information about Tax on Life Insurance Policies www.taxqueries.in
Additional Information about Lic Market Plus Plan
Days of Grace:
A grace period of 1 month but not less than 30 days will be allowed for payment of Yearly/Half yearly/Quarterly premiums. If premium is not paid within days of grace, policy will lapse.
Under auto cover benefit , where regular premiums mode policies, if premium is not paid
within days of grace, the policy will lapse, but with certain conditions , life cover, accident benefit and critical illness rider (CIR) cover will be continued.
Under regular premium policies, where at least 3 full years premiums have been paid fully,
then auto cover period will be continued to provide risk cover for life, accident benefit and critical illness rider (CIR) for
1) Two years from the date of FUP (First Unpaid Premium). or
2) The date of maturity or
3) Till such period that the policyholders’ unit account reduces to one annualized
premium ; whichever is earlier
If premiums have been paid for less than 3 years, the revival shall be made on the submission of proof of continued insurability.
If premiums have been paid for at least 3 years or more , policy may be revived without any evidence of health + arrears of premiums without interest.
Increase and Decrease in Benefits:
Increase and Decrease in Benefits is not allowed under Lic Market plus policy except to the extent of top-up premium.
Loan facility is not available under Lic Market plus plan.
Assignments and Nomination:
Under Lic Market plus plan assignment will not be allowed but Nomination / change of nomination is allowed.
The concept of compulsory surrender is also introduced under Lic Market plus plan.
Full surrender value and surrender charge:
The policyholder or life assured will have an option to surrender the policy only after completion of 3 policy years both under single and regular premium policies. There is no need to pay 3 years premium for getting surrender value.
Alteration in mode of payment:
Alteration in mode of payment will be allowed from half yearly to yearly without charging alteration fee.