Lic New Endowment Plan 814
Insurance

Lic New Endowment Plan 814

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LIC’s New Endowment Plan (Plan No. 814) is a traditional, participating, non-linked life insurance policy that offers a combination of risk cover and savings. Designed to provide financial protection against death throughout the policy term, along with lump sum payment at the end of the selected policy term, it caters to individuals seeking both insurance and investment benefits. This plan is particularly suitable for those aiming to secure their family’s future while also building a corpus for future financial needs.

Key Features of LIC New Endowment Plan (814)

LIC’s New Endowment Plan (814) comes with several features that make it an attractive option for policyholders

  • Policy TermThe policy term ranges from 12 to 35 years, providing flexibility to choose a duration that aligns with the policyholder’s financial goals.
  • Premium Payment TermPremiums are payable throughout the policy term, ensuring that the policy remains in force and continues to build value.
  • Sum AssuredThe minimum sum assured is ₹1,00,000, with no upper limit, allowing policyholders to select a coverage amount that meets their needs.
  • Bonus FacilityThe plan participates in LIC’s corporation’s profit and is eligible for bonuses. The bonuses include Simple Reversionary Bonuses and Final Additional Bonus, which enhance the policy’s value over time.
  • Tax BenefitsPremiums paid qualify for tax deduction under Section 80C of the Income Tax Act, and the maturity proceeds are tax-free under Section 10(10D), subject to prevailing tax laws.
  • Loan FacilityAfter three full years of premium payment, the policyholder can avail of a loan against the policy, providing liquidity in times of need.
  • Accidental Death and Disability Benefit RiderThis optional rider offers additional coverage in case of death or disability due to an accident, enhancing the policy’s protection.

Benefits of LIC New Endowment Plan (814)

The plan offers comprehensive benefits that cater to both protection and savings

1. Death Benefit

In the event of the policyholder’s death during the policy term, the nominee receives

  • Sum Assured on DeathDefined as the higher of the Basic Sum Assured or 10 times the annualized premium.
  • Vested Simple Reversionary BonusesBonuses declared by LIC during the policy term, added to the death benefit.
  • Final Additional Bonus (FAB)If declared, FAB is added to the death benefit, enhancing the total payout.

The policy terminates upon payment of the death benefit, providing financial security to the policyholder’s family.

2. Maturity Benefit

If the policyholder survives the policy term and has paid all premiums, they receive

  • Basic Sum AssuredThe initial coverage amount chosen at the time of policy inception.
  • Vested Simple Reversionary BonusesAccumulated bonuses added to the maturity benefit.
  • Final Additional Bonus (FAB)If declared, FAB is added to the maturity benefit, increasing the total payout.

This lump sum amount can be utilized for various financial needs, such as children’s education, marriage, or retirement planning.

3. Loan Facility

After three full years of premium payment, the policyholder can avail of a loan against the policy. The loan amount is subject to the surrender value of the policy and can be used to meet urgent financial requirements.

4. Tax Benefits

The plan offers the following tax advantages

  • Premiums PaidEligible for tax deduction under Section 80C of the Income Tax Act, up to the prescribed limit.
  • Maturity ProceedsThe lump sum amount received at maturity is tax-free under Section 10(10D), subject to prevailing tax laws.

These tax benefits enhance the plan’s appeal as a long-term financial instrument.

Eligibility Criteria

To avail of LIC’s New Endowment Plan (814), the policyholder must meet the following eligibility conditions

  • Age at EntryMinimum age is 8 years, and the maximum age is 55 years (nearest birthday).
  • Policy TermRanges from 12 to 35 years, providing flexibility to choose a duration that aligns with the policyholder’s financial goals.
  • Premium Payment TermPremiums are payable throughout the policy term, ensuring that the policy remains in force and continues to build value.

Comparison with Other LIC Plans

When comparing LIC’s New Endowment Plan (814) with other LIC plans, such as the New Jeevan Anand Plan (815), several differences emerge

  • Death BenefitThe New Jeevan Anand Plan offers 125% of the Basic Sum Assured as the death benefit, whereas the New Endowment Plan provides the higher of the Basic Sum Assured or 10 times the annualized premium.
  • Policy TermThe New Jeevan Anand Plan has a policy term ranging from 15 to 35 years, while the New Endowment Plan offers a term from 12 to 35 years.
  • Bonus RatesBoth plans participate in LIC’s corporation’s profit and are eligible for bonuses, but the rates may vary based on the policy’s performance and duration.

Choosing between these plans depends on individual financial goals and preferences. The New Endowment Plan is suitable for those seeking a combination of life cover and savings with a focus on the endowment benefit, while the New Jeevan Anand Plan offers lifelong risk cover even after policy maturity.

LIC’s New Endowment Plan (814) is a well-rounded life insurance policy that combines the benefits of life coverage with the advantages of savings and investment. Its flexible terms, bonus facility, tax benefits, and optional riders make it an attractive choice for individuals seeking financial security for themselves and their families. By understanding the plan’s features and benefits, policyholders can make informed decisions that align with their long-term financial objectives.

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