Lic Money back children assurance Policy plan no 113 Review

Lic Money back children assurance Policy Review

plan no -113

Money back children assurance policy was INTRODUCED ON – 2/1/1995 and WITHDRAWN ON – 31/3/2002. Money back children assurance plan is a policy for children’s need i.e., it is mainly developed to facilitate provisions for educational expenses of children.

Premiums come to an end on policy anniversary or immediately after the child attains the age of 18 years. Apart from risk cover money back children assurance policy also offers payment of sum assured in instalment at age 18, 20, 22, 24 and at age 26, guaranteed addition and loyalty addition if any.

Risk will commences either after 2 years from the date of commencement of policy or on policy anniversary after completion of 7 years by the child, whichever is later. After commencement of risk, guaranteed addition will vest in policy from Date Of Commencement.

Lic Money back children assurance policy Conditions

AGE AT ENTRY:                               Minimum:    0 years

                                                       Maximum:   10 years

POLICY TERM:                             26 years – age at entry

MODE OF PAYMENTS:                  Yearly, Half-yearly, quarterly,SSS, single premium

MAXIMUM MATURITY AGE:          26 years of Life assured’s last birthday.

PREMIUM PAYING TERM(PPT):   18 years – age at entry

PREMIUM CEASING AGE:             18 years of Life assured’s last birthday

SUM ASSURED:                       Minimum:     Rs. 25,000 upto 25/6/2000

                                                                  Rs. 50,000 from 26/6/2000

                                         Maximum:   Rs. 5,00,000 sum assured in multiple of Rs. 25,000

Lic Money back children assurance Policy Rebates

There are 2 types of Rebates,

1. Sum assured rebate
2. Mode rebate

Sum assured rebate:   

Sum assured	Rebate
25,000 to 49,999	Rs 1 /- per 1000 Sum assured
50,000 & above	Rs 2/- per 1000 Sum assured

Mode rebate:

Mode	Percentage
Yearly mode	3% of tabular premium
Half-yearly mode	1.5% of tabular premium
Quarterly, SSS and single premium	Nil

Lic Money back children assurance Policy Survival Benefits

In Money back children assurance policy sum assured will be paid in installments as shown below,

% of sum assured	On the policy anniversary or immediately after completion of years by life assured.
20%	18 years
20%	20 years
30%	22 years
30%	24 years
Maturity claim	26 years

Survival benefits are not payable, if policy becomes paid up before PPT. After completion of 26 years by life assured, Paid up value + vested guaranteed addition will be paid on policy anniversary.

Lic Money back – children assurance Policy Maturity Benefits

If policy is in paid up condition before the date of commencement of risk and at least 3 years

premiums have been paid, then

Maturity claim = GSV ( Guaranteed Surrendered Value )

Guaranteed addition is not payable.

If all premiums have been paid during PPT and sum assured have been paid in 4 installments, then on policy anniversary i.e., after completion of 26 years by life assured,

Maturity claim = Guaranteed addition for full policy term + loyalty addition (if any)

Sum assured or any % of sum assured is not payable

If premiums have been paid upto risk commencement date and if further premiums have not

been paid, then

Maturity claim = Paid up value + guaranteed addition

Loyalty addition is not payable.

Lic Money back children assurance Policy Death Claims

If death of life assured occurs before the risk commencement date, the policy may get cancelled and in such case,

Death claim = sum of money equal to all premiums paid – extra premium

If policy is in lapsed condition, then nothing is payable. But if 3 years premiums have been paid, then GSV is payable.

If death of life assured occurs on or after the risk commencement date, then

Death claim = full sum assured + guaranteed addition + loyalty addition (if any)

If policy have become paid up during premium paying term (PPT), then

Death claim = paid up value + guaranteed addition

Lic Money back children assurance Policy Additional Benefits

Guaranteed addition:

If the policy is in force, a guaranteed addition of Rs. 80/- per 1000 sum assured will be added to the policy at the end of each policy year.

Guaranteed addition is payable starting with the commencement date of the policy and payable on date of maturity or death or surrender.

Loyalty addition:

In Money back children assurance policy, after risk commencement on the life assured surviving specified maturity date or death date, this policy may be eligible for loyalty addition  payment at rates declared from time to time.

If policy is being surrendered or made paid up, loyalty addition will not be payable.

Accident benefit:

Accident benefit is not available under money back children assurance policy, because PPT under this plan ends on 18 years of life assured.  

Riders Available in Money back children assurance Policy

Two riders are available in Money back children assurance policy,

1. Term rider benefit
2. Premium waiver benefit

Term rider benefit:

Term rider benefit is family benefit where risk is covered on the life of proposer to the extent of 20% of basic sum assured but not exceeding Rs. 50,000.

The Term rider benefit is payable only if the proposer dies before the policy anniversary following the completion of age 18 years of child or life assured.

Proposer’s age at entry should be 50 years NDB (near birthday) and maximum maturity age will be 60 years NDB.

Premium waiver benefit:

Premium waiver benefit is available by payment of additional premium during the deferment period or till the death of the proposer. PWB is allowed subject to adequate medical examination of proposer’s life at his cost only.

GUARANTEED SURRENDER VALUE:

If 3 full year premiums are paid, then

GSV  = 90% of premiums paid – 1st year premium and additional premiums paid for PWB

In case of single premium policy,

GSV = 90% of single premium paid – all extra premiums (if any)

GSV for single premium policy will be available after expiry of 3 policy years.

If premiums have been paid fully and GSV is being calculated on or after risk commencement date , then

GSV = 90% of the premiums paid before risk commencement – 1st year and any other premium + 30% of the premiums paid after the risk commencement date + all extra premium + additional premium paid for accident benefit.

PAID UP VALUE:

If premiums are discontinued before risk commencement, there will be no paid up value to the sum assured.

If premiums have been fully paid upto risk commencement date and risk is commenced, then at least 3 full years premiums have been paid from commencement date ( not risk) , then paid up value will be calculated as,

Paid up value =  sum assured  x   no of years premiums paid  

                                                No of years premiums payable(PPT)

In case of single premium policies,

Paid up value = sum assured.

SPECIAL SURRENDER VALUE:

If premiums have been fully paid upto risk commencement date and SSV is being calculated on or after risk commencement date, then

SSV = ( paid up value + guaranteed addition ) x SSV factor.

Additional Information about Lic Money back children assurance Policy

LOAN:

Under Lic Money back- children assurance policy, Loan was not available.

REVIVAL:

Revival of policy is available under  Lic Money back- children assurance policy.

Revival of policies to children up to age 25 years(NBD) is allowed up to sum to be revived of Rs. 8 lakh under Non-medical(general).

Example:

Age at entry of life assured  – 5 yrs LBD

Sum assured –           25,000

Age of proposer –       30 years

Deferment period –     18 years

Mode of payment –     half-yearly,

Premium calculation,

Tabular premium for plan 113-21 for age 5 years                           rs. 84.15

Mode rebate 1.5%                                                                          – 1.262

Sum assured rebate                                                                       – 1.00

                                                                                                    81.888

Sum assured in thousands                                                           x     25

                                                                                                2047.20

PREMIUM WAIVER BENEFIT,

Tabular premium rate for PWB for age group of proposer upto 30 yrs

and deferment period of 18 yrs will be ——————————–            Rs. 2.95

Mode rebate @ 1.5%                                                                                  – 0.044

                                                                                                                    2.906

 

PWB premium for waiver of net annual premium of Rs. 2047.20 x 2.906 = 59.49

                                                                                                100

TERM RIDER,

MAXIMUM TERM RIDER SUM ASSURED WILL BE 20% OF SA OR RS. 50,000.

Here term rider sum assured is 5000.

Tabular premium rate for TERM RIDER for age group of proposer up to 30 yrs

And deferment period of 18 yrs will be ——————————–                      Rs. 2.70

Mode rebate @ 1.5%                                                                                          – 0.040

                                                                                                                         2.660

Sum assured in thousands                                                                                   x     5

                                                                                                                        13.30

 

Net instalment premium = 2047.20 + 59.49 + 13.30 = 2119.99

Half- yearly premium will be =1060/-