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LIC New Money Back Plan - 20 Years

  • Risk Cover and Savings Benefit
  • Participation in Profits
  • No Limit on Sum Assured

LIC New Money Back Plan - 20 Years

Choosing the right life insurance policy from a number of options available is not easy. You need to go through the policy and life insurance company in detail to ensure that you or your family will get the benefits when the time comes. Life Insurance Corporation of India (LIC India) is one of the widely trusted insurance companies in India, offering affordable products for tier 1, 2 and 3 customers.

In its innovative product range, LIC of India has launched the LIC New Money Back Plan - 20 Years, providing an ideal benefit of life risk cover and savings in one plan. Let’s look at the features, benefits, and eligibility criteria of the plan in detail to help you make informed investment decisions.

What is the LIC New Money Back Plan - 20 Years?

LIC New Money Back Plan—20 Years is a non-linked, participating, limited premium, individual life assurance savings plan. It offers the combined benefit of life risk protection and savings under one plan.

If the life assured dies during the policy term, the nominee receives the assured financial assistance as the death benefit. If the life assured survives a specified duration during the policy term, periodic payments are provided. Upon surviving the whole policy term, the life assured receives the maturity benefit in a lump sum amount.

The policy is a limited premium policy to help the policyholder plan their secured financial future. Also, in case financial requirements arise during the policy term, the life assured can take a loan against the LIC New Money Back Plan - 20 Years.

Highlights of LIC New Money Back Plan - 20 Years

Have a look at the highlights of LIC New Money Back Plan - 20 Years:

Type of Plan: Money Back Plan

Policy Term: 20 years

Rider Benefit: Yes

Grace Period: 30 days/ 15 days (monthly payment)

Free Look Period: 15 days

Eligibility Criteria of LIC New Money Back Plan - 20 Years

To buy the 20 Year Money Back Policy LIC, the customers need to comply with the following eligibility criteria and restrictions:

Entry Age 13 years - 50 years
Maximum Maturity Age 70 years
Basic Sum Assured Rs. 1 Lakh - No Limit
Policy Payment Term 15 years

Date of Commencement of Risk: Risk under policy starts immediately on the acceptance of the risk.

Date of Vesting: If the LIC New Money Back Plan - 20 Years is issued on the life of a minor, the policy automatically vests in the life assured on the policy anniversary on or immediately after the life assured completes 18 years.

What are LIC New Money Back Plan - 20 Years Benefits?

When an individual duly pays the premiums under LIC New Money Back Plan - 20 Years, they get the following assured benefits:

Death Benefit

On the death of the life assured during the policy term, the nominees receive the death benefit. The sum assured on death is paid along with the vested simple reversionary bonus and final additional bonus (if any).

The death benefit payable is an amount higher of:

  • 125% of the basic sum assured
  • 7 times of the annualized premium

Note that the death benefit paid is not less than 105% of the total premium (excluding any taxes or rider payment) paid till the date of death.

Survival Benefit

If the life assured survives each of the 5th, 10th, and 15th policy years, they receive the survival benefits of 20% of the basic sum assured.

Maturity Benefit

If the life assured survives the whole policy term, they are eligible for a sum assured on maturity equal to 40% of the basic sum assured as the maturity benefit. Additionally, they receive vested simple reversionary bonuses and a final additional bonus (if any) with the maturity benefit.

Participation in Profits

LIC 20 Years Money Back Plan participates in the profit made by the Life Insurance Corporation and is eligible to receive simple reversionary bonuses (as declared).

Additionally, the final additional bonus is payable in the year when the policy is claimed due to maturity or death of the life assured. In the case of a paid-up policy, the final additional bonus is not payable.

Optional Benefits Under 20 Years Money Back Plan LIC

Optional benefits are available under the LIC New Money Back Plan - 20 Years, which enhances coverage and makes the plan more favourable to your financial suitability and future requirements. Consider the following benefits while purchasing the plan:

Rider Benefit

Customers can add LIC riders to the plan by paying an additional premium. Some riders are available to add at the time of the policy inception, and some can be added at any policy anniversary during the policy term, provided the premium paying term is at least five years. The following riders are available to add under 20 Year Money Back Policy LIC:

LIC Accident Death and Disability Benefit Rider: If the policyholder opts for this rider, the Accident Death Benefit Sum Assured is paid to the nominee in a lump sum in case of accidental death of the life assured.

In case any accidental disability arises due to the accident (within 180 days from the date of the accident), the nominee receives an amount equal to Accident Benefit Sum Assured in equal monthly instalments for 10 years.

LIC Accident Benefit Rider: If the rider is opted for, upon the accidental death of the life assured, the nominee receives Accident Benefit Sum Assured in a lump sum.

LIC New Term Assurance Rider: If the policyholder opts for this rider, the nominee receives an amount equal to the Term Assurance Rider Sum Assured upon the death of the life assured during the policy term.

LIC New Critical Illness Benefit Rider: Under this rider, if the life assured is diagnosed with any of the specified 15 critical illnesses covered, they receive the Critical Illness Sum Assured.

However, the policyholder can choose between LIC Accident Death and Disability Benefit Rider and LIC Accident Benefit Rider. Hence, a maximum of three riders are available to add under LIC Money Back Policy 920. The sum assured of each rider can not be more than the basic sum assured under the base plan.

Settlement Option for Maturity Benefit

The settlement option allows the life assured to receive the full or part of the maturity benefit in instalments spread over the chosen period of 5/ 10/ 15 years instead of a lump sum amount. The instalments are paid in advance at the instalment payment mode selected with a minimum amount as below:

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

Option to Take Death Benefit in Instalments

This option allows one to receive the full or part of the death benefit in instalments over a chosen period of 5/ 10/ 15 years instead of a lump sum. It can be chosen for both in-force and paid-up policies. The instalment amount is paid in advance at the chosen instalment payment mode and the minimum amount payable is given below:

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

How Does LIC New Money Back Plan - 20 Years Work?

Let’s understand the working mechanism of LIC Money Back Policy 920 with an example.

Mr. Sharma, at the age of 30, decides to purchase LIC New Money Back Plan - 20 Years. The plan details are as follows:

Basic sum assured Rs. 1 Lakh
Policy term 20 years
Policy paying term 15 years
Premium payment mode Yearly
Premium (excluding taxes) Rs. 7,752

The life assured is eligible to get the following benefits:

End of the Policy Year Total Premium Paid (till the end of the year) Guaranteed Benefits Non-Guaranteed Benefits (Simple Reversionary Bonus) Total Maturity Benefit (including final additional bonus, if any) Total Death Benefit (including final additional bonus, if any)
Survival Benefits Sum Assured on Maturity Sum Assured on Death Scenario 1 Scenario 2 Scenario 1 Scenario 2 Scenario 1 Scenario 2
5 Rs. 38,760 Rs. 20,000 0 Rs. 1,25,000 Rs. 3,500 Rs. 14,000 0 0 Rs. 1,28,500 Rs. 1,39,000
10 Rs. 77,520 Rs. 20,000 0 Rs. 1,25,000 Rs. 7,000 Rs. 28,000 0 0 Rs. 1,32,000 Rs. 1,53,000
15 Rs. 1,16,280 Rs. 20,000 0 Rs. 1,25,000 Rs. 10,500 Rs. 42,000 0 0 Rs. 1,35,500 Rs. 1,67,500
20 Rs. 1,16,280 0 Rs. 40,000 Rs. 1,25,000 Rs. 14,000 Rs. 56,000 Rs. 54,000 Rs. 98,500 Rs. 1,39,000 Rs. 1,83,500

* The above benefits apply to 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. You can use the LIC New Money Back Plan - 20 Years maturity calculator to calculate the maturity benefits according to your personalized financial needs.

Additional Features of LIC New Money Back Plan - 20 Years

The following attractive features of the Money Back Policy LIC for 20 Years make it a good purchase option among customers:

Premium Payment

The policyholder can pay the premiums yearly, half-yearly, quarterly, or monthly, depending on the financial suitability.

Grace Period

A grace period is offered to make the LIC premium payments after the missed due date. A 30-day grace period is allowed for annual, half-yearly, and quarterly and 15 days for monthly premium payments from the date of the first unpaid premium.

During the grace period, the policy is considered in force, and all the benefits continue without interruption. If the premium is not paid within the grace period, the policy lapses.

Policy Revival

The policyholder can revive their lapsed LIC policy within five consecutive years from the date of the first unpaid premium but before the date of maturity. To revive the policy, the policyholder needs to pay all the outstanding premium payments with the applicable interest.

Note that the Life Insurance Corporation has all the rights to accept, modify, or reject the revival request of the lapsed policy.

Rebate on Policy

LIC New Money Back Plan - 20 Years offers two types of rebates to the policyholder, as follows:

Rebate on Premium Payment Mode:

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

Rebate on High Sum Assured (on premium):

Basic Sum Assured Rebate
Rs. 1 Lakh to Rs. 1.95 Lakhs Nil
Rs. 2 Lakhs to Rs. 4.95 Lakhs 2% of Basic Sum Assured
Rs. 5 Lakhs and above 1% of Basic Sum Assured

Paid-Up Policy

If the policyholder has paid the premiums for at least two full policy years and any subsequent premiums are not paid, the policy continues as the paid-up policy till the end of the policy term. Under such conditions, the policy shall not be wholly void, but the benefits are reduced to Death Paid-up Sum Assured and Maturity Paid-up Sum Assured. Vested simple reversionary bonuses and benefits are also paid.

Surrender of the Policy

The policyholder can surrender the policy anytime during the term if at least two full policy years' premiums have been duly paid. Upon surrender, the Life Insurance Corporation pays a value higher of:

  • Guaranteed surrender value
  • Special surrender value

Policy Loan

The policyholder can avail of the loan under the 20-Year Money Back Plan LIC if at least two full years' premiums have been paid. The maximum loan amount granted is:

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

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

Life Insurance Corporation declares the applicable interest rate on LIC loan on the methods approved by IRDAI.

Tax Benefit

LIC New Money Back Plan - 20 Years is eligible for tax benefits under the prevailing tax laws. The premiums paid gain tax benefits under Section 80C of the Income Tax Act, 1961, while the benefits payouts are exempted from tax under Section 10 (10D).

Free Look Period

The policyholder has the opportunity to review the policy during the 15-day free-look period and can return it to the Life Insurance Corporation if they are not satisfied with the terms and conditions. The policyholder needs to state the reasons for the objections.

Upon receiving the request, LIC of India cancels the policy and returns the premium deposited after deducting applicable charges.

Exclusions Under 20 Years Money Back Plan LIC

The policy shall be considered void, and the nominees are restrained from receiving the benefits under the below conditions:

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

LIC New Money Back Plan - 20 Years Premium Chart

Look at the LIC 20 Years Money Back Policy premium chart below, applicable for the basic sum assured of Rs. 1 Lakh for a standard life:

Age of the Life Assured Premium Rates (Annual)
20 Rs. 7,644
30 Rs. 7,752
40 Rs. 8,129
50 Rs. 9,021

* The above premiums are exclusive of taxes.

** To estimate the premiums payable for your personalized requirements, use the LIC New Money Back Plan - 20 Years premium calculator.

Final Words

Buying LIC Money Back Policy 920 can provide assured financial security for your family when you are no longer around. Also, if you survive the pre-determined policy years or the whole policy term, you get the financial benefits that you can utilize to fulfil different financial requirements. You can reach out to the nearest LIC branch, an LIC agent, or a RenewBuy Partner to purchase the plan.

Once purchased, list the policy on the LIC Customer Portal and keep track of it online. LIC e-services make the LIC premium payment, track the LIC claim status, and make other activities accessible from anywhere without reaching the branch.

If you need assistance while purchasing or want details on LIC policies, connect with a LIC agent or life insurance agent nearby with the help of RenewBuy Advisor Connect.

Disclaimer: The content published in this article is intended solely for the reader's informational purposes and should not be relied upon for personal, medical, legal, or financial decisions. It is advisable to seek advice from a qualified professional regarding specific concerns. The details provided regarding the plan are for reference purposes only. Please visit the insurer's website for the latest updates on the plan. The Company does not guarantee suitability, reliability, timeliness, or accuracy of the information, services, or any other aspects mentioned in this regard for any purpose. We do not endorse any particular insurance company or insurance product provided by any insurer.