Renew Your LIC Health Insurance Policy: Here's Everything You Need to Know

LIC Aadhaar Shila Plan


  • Specially Designed for Women

  • Savings and Life Cover Benefit

  • Assured Loyalty Additions

LIC Aadhaar Shila Plan

Life Insurance Corporation of India is the strongest insurance brand globally (according to Brand Finance Insurance 100 Report, 2024). The company offers various life insurance policies for individuals, including men, women, children, and senior citizens, to fulfil their financial requirements at different life stages. After comparing plans from different categories, endowment, whole life, micro saving, and term life, you can select the most suitable product at an affordable price.

LIC of India launched one such plan, Aadhaar Shila, specifically designed for women with dual savings and life cover benefits. Let’s look at the LIC Aadhaar Shila policy in detail.

What is the LIC Aadhaar Shila Plan?

LIC Aadhaar Shila policy is a non-linked, participating, individual, savings life insurance plan which offers a combined benefit of protection and savings. The plan is specially designed for women. In case of uncertain demise of the policyholder during the policy term, the nominee receives assured financial support. If the insured survives the policy, they receive the maturity benefit.

In addition, the policy comes up with the auto cover facility and loan availability to fulfil the liquidity needs of the policyholder.

Highlights of LIC Aadhaar Shila Policy

Below are the key highlights of the plan that make it an ideal purchase for women:

Plan Type: Endowment plan

Life Covered: Women lives

Benefit Offered: Combination of saving and life protection

Additional Benefit: Auto cover & loan facility

Policy Term: 10 - 20 years

Rider Option: LIC Accident Benefit Rider

Premium Rate: Low premium LIC plan

Eligibility Criteria of LIC Aadhaar Shila Plan

LIC Aadhaar Shila plan is specially designed for women to help them save money and become financially secure against any uncertainty of life. To purchase the LIC Aadhaar Shila plan, women need to follow the below eligibility criteria and restrictions:

Entry Age 8 years - 55 years
Maturity Age 18 years - 70 years
Policy Paying Term Same as the policy term
Basic Sum Assured Per Life Rs. 2 Lakhs - Rs. 5 Lakhs

Date of Commencement of Risk: The risk commences immediately from the date of risk acceptance under LIC Aadhaar Shila plan.

Date of Vesting: Say the LIC Aadhaar Shila plan is issued on the life of a minor (age less than 18 years), then the policy automatically vests in the life assured on the policy anniversary coinciding with or immediately completion of the 18 years of age.

View the claim settlement ratio of LIC of India.

What are LIC Aadhaar Shila Plan Benefits?

The life assured or the beneficiaries receive the following benefits when all the premium payments are duly paid under the LIC Aadhaar Shila policy:

Death Benefit

Upon the death of the life assured during the policy term, the beneficiaries receive the death benefit in the following manner:

  • On death of the life assured in the first five policy years, the beneficiaries receive sum assured on death.
  • On death of the life assured after completing the first five policy years but before the policy maturity date, the beneficiaries receive sum assured on death with the loyalty additions (if any).

Where the sum assured on death payable is the higher of the below:

  • 7 times of the annualized premium
  • 110% of the basic sum assured

However, the death benefit payable can not be more than 105% of the premiums paid until the death of the life assured.

Maturity Benefit

If the life assured survives until the end of the policy term, they receive the sum assured on maturity with the loyalty additions as the maturity benefit. The sum assured on maturity is equal to the basic sum assured.

Loyalty Addition

When the policyholder duly pays the premium for at least five full policy years, the policy is eligible to receive a loyalty addition depending on the experience of the corporation in the market. These loyalty additions are paid with the death benefit and maturity benefit claimed.

If the policy acquires the paid-up value, the loyalty additions are only payable for the years the policy was in force. If the policyholder opts to surrender the policy after five policy years, loyalty additions are also payable with the surrender value.

Optional Benefits Under LIC Aadhaar Shila Plan

Besides the benefits mentioned above, the LIC Aadhaar Shila policy also offers optional benefits to provide the policyholders with the maximum flexibility, including the following:

Add-On Rider

The policyholder can add LIC Accident Benefit Rider to the base policy anytime during the policy term, provided the outstanding policy term is at least five years. If the policyholder opts for the rider, and upon the accidental death of the life assured, the beneficiaries receive the accidental benefit sum assured in a lump sum.

Learn more about how LIC riders work.

Settlement Option for Maturity Benefit

Under this option, the maturity benefit is paid in instalments over a period of five years instead of a one-time lump-sum amount. The policyholder or the life assured (when 18 years or above) can opt for this option for full or part of the maturity benefit. The minimum instalments for different premium payment modes shall be paid as:

Mode of Instalment Payment Minimum Instalment Amount
Monthly Rs. 5,000
Quarterly Rs. 15,000
Half-yearly Rs. 25,000
Yearly Rs. 50,000

Option to Take Death Benefit in Instalments

If the policyholder opts for this option, the nominees receive the death benefit in instalments over the period of 5, 10, or 15 years instead of a lump sum amount. The settlement option can be chosen for a paid-up and in-force policy for full or part of the death benefit. The instalment is paid in advance at the chosen period with a minimum instalment amount in the below manner:

Mode of Instalment Payment Minimum Instalment Amount
Monthly Rs. 5,000
Quarterly Rs. 15,000
Half-yearly Rs. 25,000
Yearly Rs. 50,000

How Does LIC Aadhaar Shila Policy Work?

Using the example below, let’s understand how the LIC Aadhaar Shila plan works.

Say Mrs. Das purchases the LIC Aadhaar Shila plan at the age of 35. She chooses a basic sum assured of Rs. 2 Lakhs for a policy term of 20 years. She pays Rs. 7,860 as the annual premium. Look at the benefits she can claim under different scenarios:

End of the Policy Year

Total Premium Paid (till the end of the year)

Guaranteed Benefits

Non-Guaranteed Benefits (Loyalty Additions)

Total Maturity Benefit (including loyalty additions, if any)

Total Death Benefit (including loyalty additions, if any)

Sum Assured on Maturity Sum Assured on Death Scenario 1 Scenario 2 Scenario 1 Scenario 2 Scenario 1 Scenario 2
5 Rs. 39,300 0 Rs. 2,20,000 0 0 0 0 Rs. 2,20,000 Rs. 2,20,000
10 Rs. 78,600 0 Rs. 2,20,000 0 Rs. 13,000 0 0 Rs. 2,20,000 Rs. 2,33,000
15 Rs. 1,17,900 0 Rs. 2,20,000 0 Rs. 23,000 0 0 Rs. 2,20,000 Rs. 2,43,000
20 Rs. 1,57,200 Rs. 2,00,000 Rs. 2,20,000 0 Rs. 33,000 Rs. 2,00,000 Rs. 2,33,000 Rs. 2,20,000 Rs. 2,53,000

* The above benefits are applicable for the standard life where no riders are added to the base policy.

** Here, Scenario 1: Projected investment rate of return assumption of 4% per annum (assumed) and Scenario 2: Projected investment rate of return assumption of 8% per annum (assumed).

*** The benefits are just an illustration and are taken from the sources available on the official website of LIC of India.

Additional Features of LIC Aadhaar Shila Policy

The following features are available under the LIC Aadhaar Shila policy that make the plan flexible and suitable to the financial goals of an individual:

Flexible Premium Payment

The policyholder makes the premium payment yearly, half-yearly, quarterly, or monthly, depending on their financial suitability.

Grace Period

If the policyholder misses paying their premium by the due date, they can pay it within the grace period allowed. A 30-day grace period is allowed for yearly, half-yearly, and quarterly payments, while a 15-day grace period is allowed for monthly premium payments from the date of the first unpaid period. During the grace period, all the benefits continue without interruption per the policy terms. After the completion of the grace period, the policy lapses.

Policy Revival

The revival of lapsed LIC policy is possible within five consecutive years from the date of the first unpaid premium but before the policy maturity date. LIC Aadhaar Shila policy revives once the policyholder pays all the outstanding premiums with the interest as applicable. Life Insurance Corporation can accept or decline the request for LIC policy revival.

Paid Up Policy

Suppose the policyholder pays all the due premiums for at least two full policy years, and no subsequent premium payments are made. In such a case, the LIC Aadhaar Shila policy is not considered completely void but continues as a paid-up policy till the end of the policy term.

If only three full years of premiums have been duly paid and any subsequent premiums are not paid, an auto cover period is applicable under such policy.

Auto Cover Period:

The auto cover period under a paid-up policy is the period from the due date of the first unpaid premium and is applicable as:

  1. If the policyholder pays the premiums for at least three full policy years but less than five policy years and no further premium payments are made, the auto cover period is available for only six months.
  2. If the policyholder pays the premiums for at least five full policy years, and no further premiums are paid, the auto cover period of two years is available.

Policy Rebate

The LIC Aadhaar Shila policy is eligible for two types of rebates:

Mode Rebate:

Mode of Premium Payment Offered Rebate
Yearly 2% of the tabular premium
Half yearly 1% of the tabular premium
Quarterly, Monthly Nil

Rebate on High Sum Assured:

Basic Sum Assured Offered Rebate
Rs. 2 Lakhs to Rs. 2.95 Lakhs Nil
Rs. 3 Lakhs to Rs. 3.75 Lakhs 0.50% of the basic sum assured
Rs. 4 Lakhs to Rs. 4.75 Lakhs 1.50% of the basic sum assured
Rs. 5 Lakhs 2.50% of the basic sum assured

Policy Surrender

When the policyholder has paid premiums for at least two full years, she can surrender the LIC Aadhaar Shila policy anytime during the policy term. Upon LIC policy surrender, the Life Insurance Corporation pays the surrender value, higher of:

  • Guaranteed surrender value
  • Special surrender value

Policy Loan

If the policyholder has duly paid the premiums for at least two full policy years, they can avail of the loan anytime during the policy term. The Life Insurance Corporation determines the interest rates charged periodically. The maximum loan allowed is:

For in-force policies: Upto 90% of the surrender value

For paid-up policies: Upto 80% of the surrender value

Tax Benefit

LIC Aadhaar Shila policy is eligible for tax benefits under the prevailing tax rates. The premium paid towards LIC Aadhaar Shila may gain tax benefits under Section 80C of the Income Tax Act. Also, the benefits received are subject to tax exemption under Section 10 (10D) of the IT Act.

Free Look Period

If the policyholder is not satisfied with the terms and conditions of the LIC Aadhaar Shila, they can return it to the corporation within 30 days from the date of receipt of the policy bond. The policyholder needs to state the reason for objections. On receiving the cancellation request, the Life Insurance Corporation (LIC of India) cancels the policy and returns the premium amount deposited after deducting the applicable charges.

Learn more about how you can track LIC policy status.

Exclusion (Dismissal of Benefits) Under LIC Aadhaar Shila Plan

Under certain circumstances, the LIC Aadhaar Shila policy bars the nominee from receiving stipulated benefits. Let’s look at the exceptional circumstances below:

  • If the life assured commits suicide at any time within the 12 months from the date of commencement of the risk under the in-force policy, the nominee receives 80% of the total premium paid.
  • If the life assured commits suicide within 12 months from the date of policy revival, the policyholder receives an amount higher of
  • 80% of the premium paid till the date of the death
  • Surrender value as available on the date of the death

Note that the nominee cannot make any further claim under the policy.

LIC Aadhaar Shila Policy Premium Chart

Look at the LIC Aadhaar Shila policy premium chart on an annual basis. The below premium rates are for standard life and the plan selected for different ages and policy terms:

Age/ Policy Term 10 15 20
10 Rs. 17,787 Rs. 10,868 Rs. 7,595
20 Rs. 17,856 Rs. 10,937 Rs. 7,654
30 Rs. 17,885 Rs. 10,986 Rs. 7,732
40 Rs. 18,071 Rs. 11,241 Rs. 8,075
50 Rs. 18,728 Rs. 12,074 Rs. 9,045

* The above premium rates are exclusive of taxes.

** You can use the LIC Aadhaar Shila premium calculator to get an estimated premium amount for your personalized insurance needs and financial requirements.

Know how you can make LIC premium payments.

What Documents Required to Purchase the LIC Aadhaar Shila Plan?

A woman needs to prepare the below documents to buy LIC Aadhaar Shila policy:

  • Proof of identity: Aadhaar card, voter ID, etc.
  • Proof of address: Aadhaar card, ration card, driving license, voter card, electricity bill, etc.
  • Proof of income: income tax return slips or salary slips
  • Medical records: Health history

Final Words

The LIC Aadhaar Shila policy works as a savings box for women, where they can deposit money and earn a good amount at maturity. Also, they can remain financially secure against any life risk. The plan is a low premium-paying with a 10 to 20-year policy term. Once the policy matures, the insured women get good funds in hand.

Also, in case of emergency, they can avail of loans. Contact a LIC agent nearby if you want more details about the plan or to buy the policy. RenewBuy Advisor Connect can help you find a nearby LIC or life insurance agent.