What is Jeevan Saral policy?

LIC Jeevan Saral is actually an endowment policy with a lot of flexibilities that is usually available only with unit linked insurance plans. Hence it is categorized under Special Plans. This plan offers Double Death Benefit of Sum Assured + Return of Premium.

How does Jeevan Saral policy work?

The Maturity Sum Assured plus Loyalty additions, if any, is payable in a lump sum. Premiums paid are exempted from income tax-free for Jeevan Saral policy under Sec 80 C. It gets a share of the profits in the form of loyalty additions which are terminal bonuses payable along with death benefit or maturity benefit.

Is it good to continue Jeevan Saral policy?

Jeevan Saral is supposed to give better surrender and/or paid-up value. It was considered a good plan with a lot of flexibility for young people. The main issue with the product is for those in the higher age group. Moneylife has received several complaints from Jeevan Saral policyholders.

How is maturity sum assured calculated?

The basic format is Sum Assured + Bonuses + Final Additional Bonus (if declared). An example for calculation demonstration: Mr Z buys a policy of Sum Assured 15 Lakh with a term of 20 years. The insurance company includes Bonuses and Final Additional Bonus in the maturity value as per their company policy.

How Loyalty addition is calculated?

Loyalty Addition for per 1000 of Maturity Sum Assured So loyalty addition will be 100000 x 640/1000= 64,000. If death of the policy holder happens in 10th policy year then applicable Loyalty Addition rate will be 425 and total loyalty addition will be 1,00,000 x 425/1000= 42,500.

What is loyalty addition in LIC Jeevan Saral?

Loyalty Addition (LA) in Jeevan Saral policy depends on the duration of the policy completed with full sum assured and, the annual premium band of the policy. An annual premium band can be calculated on the basis of monthly premium in Jeevan Saral. Higher the premium, higher is the loyalty addition in Jeevan Saral.

Is sum assured same as maturity value?

The sum assured refers to the amount guaranteed by an insurance policy whereas maturity value refers to the amount paid by an insurance company to the policy holder on maturity of the said policy.

What is LIC loyalty addition?

Loyalty Addition (LA) is profit shared by LIC among its policy holders in the form of onetime payment in case of maturity or death claim. It means that if a policy is getting matured or becoming a death claim, then Loyalty Addition will as per following rates.

Is the LIC Jeevan Saral plan still available?

LIC Jeevan Saral Plan has been withdrawn by LIC and is not available for sale and purchase. It is basically an Endowment Assurance plan under which the proposer has simply to choose the amount and mode of premium payment. The plan comes out with the needful financial protection support death throughout the term of the plan.

How are Jeevan Saral premiums exempt from tax?

Premiums paid are exempted from income tax-free for Jeevan Saral policy under Sec 80 C. The maturity proceeds of Jeevan Saral are also exempted from tax under Section 10 (10D).

How to calculate the maturity of a Jeevan Saral policy?

In order to calculate the maturity amount, the Jeevan Saral Maturity Calculator evaluates the sum assured of maturity based on the Age (at the time of buying the policy) you enter, Premium and Term, and adds the Loyalty Addition to give you the approximate maturity value.

What is the surrender value of the Jeevan Saral plan?

The surrender value of the Jeevan Saral plan is the higher of Guaranteed surrender value (GSV) and special surrender value (SSV) applicable at the time of surrender. Special Surrender Value (SSV) = Accumulated value of the policy + Loyalty additions (If any)