Jeevan Anand Plan – (Table No 149)
Benefit Illustration
Introduction
Insurance Regulatory & Development Authority (IRDA) requires all life insurance
companies operating in India to provide official illustrations to their customers. The
illustrations are based on the investment rates of return set by the Life Insurance
Council (constituted under Section 64C(a) of the Insurance Act 1938) and is not
intended to reflect the actual investment returns achieved or may be achieved in future
by Life Insurance Corporation of India (LICI).
For the year 2003-04 the two rates of investment return declared by the Life Insurance
Council are 6% and 10% per annum.
Product summary
This plan is a combination of Endowment Assurance and Whole Life plans. It provides
financial protection against death throughout the lifetime of the life assured with the
provision of payment of a lump sum at the end of the selected term in case of his
survival.
Premium :
Premiums are payable yearly, half-yearly, quarterly, monthly or through salary
deductions as opted by you throughout the selected term of the policy or till earlier
death.
Bonuses:
This is a with-profit plan and participates in the profits of the Corporation’s life insurance
business. It gets a share of the profits in the form of bonuses. Simple Reversionary
Bonuses are declared per thousand Sum Assured annually at the end of each financial
year. Once declared, they form part of the guaranteed benefits of the plan. Bonuses will
be added during the selected term or till death, if it occurs earlier. Final (Additional)
Bonus may also be payable provided the policy has run for certain minimum period.
Benefits in case of death during the selected term:
The Sum Assured along with the vested bonuses is payable on death in a lump sum.
Benefits in case of survival to the end of selected term:
The Sum Assured along with the vested bonuses is payable in a lump sum on survival
to the end of the term. An additional Sum Assured is payable on death thereafter.
Accident Benefit:
An additional Sum Assured (subject to a limit of Rs.5 lakh) is payable in a lump sum on
death due to accident up to age 70 of life assured. In case of permanent disability of the
life assured due to accident this additional Sum assured is payable in instalments.
Supplementary/Extra Benefits : These are the optional benefits that can be added
to your basic plan for extra protection/option. An additional premium is required to be
paid for these benefits.
Surrender Value:
Buying a life insurance contract is a long-term commitment. However, surrender values
are available on the plan on earlier termination of the contract.
Guaranteed Surrender Value:
The policy may be surrendered after it has been in force for 3 years or more. The
guaranteed surrender value is 30% of the basic premiums paid excluding the first year’s
premium. Any extra premium(s) paid and premium(s) towards Accident Benefit are also
excluded.
Corporation’s policy on surrenders :
In practice, the Corporation will pay a Special Surrender Value – which is either equal to
or more than the Guaranteed Surrender Value. The benefit payable on surrender
reflects the discounted value of the reduced claim amount that would be payable on
death or at maturity. This value will depend on the duration for which premiums have
been paid and the policy duration at the date of surrender. In some circumstances, in
case of early termination of the policy, the surrender value payable may be less than the
total premium paid.
The Corporation’s surrender value will be reviewed from time to time and may change
depending on the economic environment, our experience and other factors.
Note : The above is the product summary giving the key features of the plan. This is
for illustrative purpose only. This does not represent a contract and for details please
refer to your policy document.
Benefit Illustration:
Statutory warning
“Some benefits are guaranteed and some benefits are variable with returns based on
the future performance of your insurer carrying on life insurance business. If your policy
offers guaranteed returns then these will be clearly marked “guaranteed” in the
illustration table on this page. If your policy offers variable returns then the illustrations
on this page will show two different rates of assumed future investment returns. These
assumed rates of return are not guaranteed and they are not upper or lower limits of
what you might get back as the value of your policy is dependent on a number of factors
including future investment performance.”
Age at entry: 35 years
Premium paying term: 25 years
Mode of premium payment: Yearly
Sum Assured: Rs.1,00,000/-
Annual Premium: Rs.4,535 /-
End of
Year
Total
premium
paid till end
of year
Benefit payable on death during the selected term
Guaranteed
*
Variable Total
Scenario 1 Scenario 2 Scenario 1 Scenario 2
1 4,535 1,00,000 1500 5100 101500 105100
2 9,070 1,00,000 3000 10200 103000 110200
3 13,605 1,00,000 4500 15300 104500 115300
4 18,140 1,00,000 6000 20400 106000 120400
5 22,675 1,00,000 7500 25500 107500 125500
6 27,210 1,00,000 9000 30600 109000 130600
7 31,745 1,00,000 10500 35700 110500 135700
8 36,280 1,00,000 12000 40800 112000 140800
9 40,815 1,00,000 13500 45900 113500 145900
10 45,350 1,00,000 15000 51000 115000 151000
15 68,025 1,00,000 22500 76500 122500 176500
20 90,700 1,00,000 33000 113000 133000 213000
25 1,13,375 1,00,000 41500 141000 141500 241000
End of
Year
Total
premium
paid till
end of
year
Benefit payable on survival to the end of selected
term
Guaranteed
Variable Total
Scenario 1 Scenario 2 Scenario 1 Scenario 2
25 1,13,375 1,00,000 41500 141000 141500 241000
26
onwards
1,13,375 1,00,000 **
- - 1,00,000 ** 1,00,000 **
* In addition to the benefits given in the column, an Accident Benefit of Rs. 1,00,000 /- will
also be available without payment of extra premium in case of death/disability due to accident.
** Benefit payable on death after the selected term. If the death occurs due to accident up to
age 70 an additional Rs. 1,00,000/- will also be paid.
i) The above illustration is applicable to a non-smoker male/female standard (from
medical, life style and occupation point of view) life.
ii) The non-guaranteed benefits (1) and (2) in above illustration are calculated so
that they are consistent with the Projected Investment Rate of Return assumption of 6%
p.a.(Scenario 1) and 10% p.a. (Scenario 2) respectively. In other words, in preparing
this benefit illustration, it is assumed that the Projected Investment Rate of Return that
LICI will be able to earn throughout the term of the policy will be 6% p.a. or 10% p.a.,
as the case may be. The Projected Investment Rate of Return is not guaranteed.
iii) The main objective of the illustration is that the client is able to appreciate the
features of the product and the flow of benefits in different circumstances with some
level of quantification.
iv) Future bonus will depend on future profits and as such is not guaranteed.
However, once bonus is declared in any year and added to the policy, the bonus so
added is guaranteed.
