Many people consider purchasing an insurance policy to generate regular income after retirement and strengthen their financial planning. The Life Insurance Corporation of India's (LIC) Jeevan Utsav policy is one such option. Under this plan, policyholders have the option to pay premiums for 5 to 16 years. However, depending on the policy terms and the option chosen, they can receive income for life.

What are the features of LIC Jeevan Utsav Policy?

LIC Jeevan Utsav is a non-linked and non-participating individual life insurance plan. Therefore, the benefits of this policy are not directly dependent on stock market returns. The minimum basic sum assured in this plan is ₹5 lakh. Policyholders can choose the premium payment term based on their needs.

How much premium for sum assured of Rs 5 lakh?

For example, if a 30-year-old person chooses a basic sum assured of Rs 5 lakh, the annual premium will be as follows as per the given example.

5-year option – Rs 1,10,150

8-year option – Rs 72,600

12-year option – Rs 44,275

16-year option – Rs 30,025

This is an example of the premium. Actual premiums may vary depending on age, policy terms and applicable charges.

How much income can one earn in a lifetime?

The Regular Income Benefit option of this policy provides an annual income of 10% of the basic sum assured. That is, on a basic sum assured of ₹5 lakh, you can receive ₹50,000 annually. If you choose to pay premiums for five years, income typically begins in the 11th policy year. However, a 10% annual income does not necessarily mean a 10% return on your investment. The actual return depends on the total premiums paid and the policy terms.

Guaranteed Additions and Other Benefits
A guaranteed addition of ₹40 is added for every ₹1,000 of the Basic Sum Assured during eligible premium payment years. The policy also offers a Flexi Income option. This allows income to be deferred and interest to be earned on the eligible sum assured, subject to applicable terms and conditions.

Additionally, death benefits, loan against the policy, and optional riders may be available depending on the policy's terms and conditions. It's important to check applicable laws and eligibility for tax benefits.

PC: Asianet  news