LIC Index Plus

Death Benefit

When all the premiums are duly paid towards the LIC Index Plus policy, , the death benefits are payable in case of the death of the life assured before the date of maturity (including the grace period) in the following manner:

On the death of the life assured before the date of commencement of risk:

The beneficiaries receive an amount equal to the unit fund value as available on the date of intimation of death.

On the death of the life assured after the date of commencement of risk:

The beneficiaries receive an amount highest of:

• The basic sum assured reduced by the partial withdrawals (if any, made during the two years before the date of death), or
• Unit fund value available on the date of intimation of death, or
• 105% of the total premium paid upto the date of death after deducting the partial withdrawals (if any, made during the two years before the date of death)

If any charges (mortality, accident benefit, policy administration, and tax charges) are recovered later on the date of death, the deducted amount should be added back to the unit fund value available on the date of intimation of death. Any guaranteed additions added after the date of death shall be recovered from the unit fund. The nominee receives the total amount as incurred.

Maturity Amount

If the life assured survives the date of maturity, an amount equal to the unit fund value available is payable to the life assured.

Refund of Mortality Charges

Suppose the life assured survives the maturity date, and all the premiums under LIC Index Plus are duly paid. In such a case, the total mortality amount deducted in respect of the life insurance cover is payable along with the maturity benefit. The total mortality charges exclude any extra amount charged as underwriting decisions and taxes applied. The refund of mortality charges is not allowed under a surrendered or discontinued policy.

Guaranteed Additions

Guaranteed additions are added to the in-force policies when all the premiums have been duly paid. The guaranteed additions are a percentage of the annualized premium, added to the unit fund upon completion of the specified policy year in the following manner:

Premium Payment Option

The policyholder can opt to pay the premium annually, half-yearly, quarterly, or monthly. The selection has to be made at the time of commencement of the policy, and it can be changed at any policy anniversary.

Free Look Period

If the policyholder is not satisfied with the terms and conditions, they can return the LIC Index Plus policy within 30 days of the policy receipt. They need to state the reason for the objections. The corporation shall cancel the policy upon receiving the request and refund the amount equal to the value of units (as on the date of receipt of the request) after deducting applicable charges.

Grace Period

A grace period of 15 days is available for monthly premium payments and 30 days for yearly, half-yearly, or quarterly premium payments from the date of the first unpaid premium. If the premiums are not paid within the grace period provided, the policy lapses and the benefits cease.

Policy Revival

The lapsed LIC policy can be revived to regain the benefits under the following circumstances:

Case I: Revival of Discontinued Policy During the Lock-in Period:

Suppose the policyholder opts to revive the policy during the revival period of 3 years from the date of the first unpaid premium. In such a case, the policyholder needs to pay all the due and unpaid premiums without interest. All applicable premium allocation charges and tax charges due are deducted from the unit fund.

Case II: Revival of Discontinued Policy After the Lock-in Period:

Suppose the policyholder opts to revive the policy during the revival period of 3 years from the date of the first unpaid premium or before the date of maturity, whichever is earlier. The policyholder needs to pay all the due and unpaid premiums without interest. All the applicable charges till the date of discontinuance are deducted from the unit fund.

Policy Surrender

The policyholder can surrender the policy anytime during the policy tenure under the following conditions:

Case I: Surrender of the Policy During the Lock-in Period of 5 Years

The unit fund value, after deducting the applicable discontinuance charge, is transferred to the discontinued policy fund. The policy remains invested until the end of the lock-in period. Upon the expiry of the lock-in period, the proceeds of the discontinued policy fund are paid to the policyholder, and the policy terminates. In case of the death of the life assured after the surrender but before the expiry of the lock-in period, the proceeds of the discontinued policy fund are paid to the nominee, and the policy terminates.

Case II: Surrender of the Policy After the Lock-in Period of 5 Years

The policyholder receives the unit fund value available on the date of intimation of surrender, and the policy terminates.

Tax Benefits

The policyholder can avail of tax benefits according to the tax law and tax rate. The premium paid towards LIC Index Plus is eligible for tax deductions under Section 80C and 80CCC. Also, the payouts received are tax-exempt (up to a definite limit) under Section 10 (10D) of the Income Tax Act, 1961.