Tax Savings

LIC Jeevan Umang Policy: Does it Offer any Tax Benefit?


LIC (Life Insurance Corporation) is a public company. The main office is in Mumbai. It was established in 1956. It is now India’s largest provider of life insurance. There are 25 crore subscribers to the LIC family. A LIC plan is always a benefit for the family. It’s a good long-term investment. LIC Jeevan Umang Policy is one of the various plans started by LIC. It was launched on February 1, 2020.

The goal is to give security and money to your loved ones. Customers can also use loan facilities with this plan. It gives coverage for the insured person’s whole life. Even a maximum of 100 years. A final amount is given to the policyholder’s heir or chosen person. This is if they pass away during the term of the plan.

Characteristics Of Lic Jeevan Umang Policy 

The following are some of LIC Jeevan Umang Policy defining elements-

  • The amount guaranteed begins at Rs. 2 lakhs. There is no upper limit. Policyholders are free to select any amount. It should be assured above the minimum.
  • LIC offers a variety of high-quality payment alternatives. Policyholders may select any period. They do so by looking at their needs. The payment time can be 15 to 30 years. It depends on the person getting insurance.
  • The term is determined by deducting the policyholder’s age from 100. LIC Jeevan Umang’s policy age of maturity is 100 years. The policy term will be 75 years if the policyholder takes the plan at the age of 25.
  • Policyholders of LIC may deposit insurance contracts on terms. It can be monthly, quarterly, mid, or annual. Policyholders can only use the National Automated Clearing House (NACH) service to make monthly payments.
  • The plan is deemed null if premiums are paid for less than three years. It will be void if the policyholder fails to pay the payment for the coming years.
  • There is a 15-day free trial duration for LIC’s Jeevan Umang Policy. Policyholders may examine the policies and terms of the insurance throughout that time.

Who Is Eligible For Lic Jeevan Umang Policy?

The eligibility criteria for the policy are listed here: –

  • The age requirement for entrance is 90 days.
  • The entry age cap is 55 years old.
  • The age of the policyholder at the end must be at least 30.
  • A policyholder’s age at the end of the paying period may not exceed 70.
  • The threat will start right away for policyholders older than 8 years. Risk will start for policyholders under the age of 8. This is after two years of uninterrupted insurance coverage.

All The Benefits Of Lic Jeevan Umang Policy

Death aid: If the policyholder passes away before the policy’s maturity date, the nominee will be given a pay-out based on the conditions listed below:

  • Loss of life before the risk begins: The entire premiums will be paid. It excludes interest and any fees. It will be used to find the payout amount. The payment will include any extra fees assessed. It is for add-on riders or any underwriting judgement.
  • After the risk has started. Some amounts will be paid at maturity if death strikes. Those are:
  1. 10 times the yearly premium.
  2. The basic sum is assured.
  3. The sum assured. The sum must be at least 105% of the total premiums paid.

Life aid: Valid until the date of maturity. Even until the insurer passes away, an annual survival benefit equal to 8% will be paid to the policyholder. Valid only if the insured person lives to the conclusion of the paying term. Must pay all premiums to make the policy effective.

Benefit at Maturity: If the policyholder lives to the date of maturity. Then a payout is made to him or her that consists of the basic sum assured. Also, bonuses and final extra bonuses.

Loans are only available to insurers. For whom plans have developed a particular amount. This is during the policy period. Such loans are subject to interest rates and are periodically reviewed. A loan may be available if the policy premium has been paid for at least three years.

The Effects Of LIC Jeevan Umang On Taxes: Tax Benefit

The IT Department imposes some mandatory taxes. In accordance with the applicable tax legislation. The marginal rates can change depending on factors. The policyholder should pay all relevant taxes. It is fully on the basic policy and rider premiums. Tax relief is there for the paying members and holds the coverage. This is under Section 80C of the Income Tax Act of 1961. Policyholders can also claim tax advantages on the policy’s proceeds.

How Can One Claim It?

If you want to Claim this policy as the nominee or recipient, first notify the insurer. The policyholder must provide the company with a discharge form. Also, the needed information to take maturity benefits. The list of records that must be given in support of a death claim is provided below:

  • claim form submitted, 
  • claim form submitted, 
  • medical records (if needed)
  • Policing FIR (if needed)
  • certificate of death
  • report on the autopsy
  • the claimant’s ID and proof of age.

What Are Some Of The Exceptions Here

There are two primary exceptions here-

  • If the insurer dies by suicide before the policy has been in effect. The coverage will be void if it is 12 months since the risk began. All claims in these situations will be denied, except 80% of the premiums paid.
  • A cash payout equal to or greater than 80% of the fees charged. This is only within a year following the date of reactivation.

Final Takeaway

LIC Jeevan Umang Policy is a popular insurance plan. By choosing this policy, you can gain protection as well as build up a savings fund for the future. Other useful services provided by LIC Jeevan Umang Policy include loans and annual income benefits. Getting this insurance coverage has no negatives. Try using LIC Jeevan Umang Calculator to check if it is in your price range. For more details on insurance policies and their benefits, visit Piramal Finance. They have many articles and blogs to help you learn more about this topic.