LIC SIIP Plan 2024

Life Insurance Corporation (LIC) SIIP or SIIP-Plan 852 is a regular premium, unit-linked, non-participating individual life insurance plan. It provides investment and liability insurance coverage for the duration of the policy. SIIP full form in LIC is a Systematic Investment Insurance Plan. The idea presents itself as a chance to make money from the Market's available investment possibilities.

People can invest in this plan offline or online, and they have a choice of four different fund alternatives to put their hard-earned money in. Like all other plans, it has specific eligibility criteria, benefits, types of funds and so on. This article covers LIC SIIP plan details for a better understanding of this policy.

Features of the SIIP Plan

Jotted down below are some of the top-notch features of this insurance plan to help you understand it better:

• There are four fund alternatives available under the scheme
• The income tax Act's Sections 80c and 10 (10D) allow for the use of tax advantages
• Policyholders have unlimited free fund switching options
• The strategy presents a chance to generate long-term investment rewards
• According to the rules, partial withdrawals of funds are permitted
• The plan provides an opportunity for additional rider benefits to extend the policy's coverage

Types of Funds Plan

The coverage premium is used to purchase units in accordance with your chosen fund type. According to the Investing preferences, you can select any of the following fund options:

  The plan's return depends on the funds you choose. Therefore, it's crucial to make a wise choice. Returns are not likely to be extremely high if you select a low-risk fund. If you invest a minimum of 5 years, then you can invest in little more aggressive for generating higher returns.

How Does the LIC SIIP Plan Work?

Investors can opt for any of the available fund types. Given that the sum assured has no maximum limit, you are free to make any number of investments. In addition, you can pay the policy's payments on a monthly, quarterly, half-yearly, or even annual Basis. Since the policy term and the period during which the premium is paid are comparable, a 20-year policy term would also correspond to a 20-year premium period.

Benefits of the SIIP Plan

Here are a few advantages that this policy's subscribers get to enjoy.

Surrender Benefit

The plan allows you to give it up in an emergency. You will get the value of the unit fund after subtracting the discontinuance charge if you surrender before the lock-in period expires. You must pay the whole unit fund value if you withdraw after the lock-in period.

Maturity Benefit

A sum equal to the unit fund value and the refund of mortality costs is payable to the insured if all the premiums are paid fully by the policyholder at the time of maturity.

Death Benefit

The plan will pay the nominee or beneficiary an amount equivalent to the unit fund value in the event of death (before the commencement date of risk) throughout the policy term. An amount greater than the basic sum assured unit fund value, or 105% of the entire premium, is due upon death following the risk's commencement date.

Refund or Mortality Benefit

If the insured member lives past the maturity date, he will be paid a sum equal to the mortality costs, except the premiums above the maturity benefit.

Guaranteed Additions

SIIP LIC is a special ULIP that provides guaranteed returns. It will represent a portion of the set yearly premium. The guaranteed additions will be converted to units based on the fund's Net Asset Value (NAV) and credited to the unit funds. The proportion is as follows:

Eligibility Criteria

The SIIP plan has a set of eligibility requirements, much like the other plans. You can understand this using the following table:

Charges Applicable in LIC SIIP Plan

Let's look at the charges that are applicable under the SIIP Plan of the LIC.

Switching Charges

Under the LIC SIIP plan, you can move funds a maximum of four times each Fiscal Year. After that, every switch in that year will incur switching fees of Rs. 100.

Mortality Charges

They are the age-specific cost of life Insurance Coverage. At the beginning of each policy month, these charges are subtracted from the unit fund value in the amount of the required number of units. The amount at risk during the policy's term determines the mortality fee.

Fund Management Charge

This fee is applied as a percentage of the asset's value and is appropriated by charging the fund management charges on the NAV. This charge is calculated at the time of the daily computation of NAV. The annual fund management fees are 1.35% of the fund's total value. In the event of a policy fund that has been discontinued, it would be 0.5% of the fund annually.

Partial Withdrawal Charge

A partial withdrawal fee of Rs. 100 is applied to the unit fund at the time of a partial withdrawal.

Accidental Benefit Charges

If you choose an accidental death benefit rider, there is a price for the benefit. This fee is withdrawn at the beginning of each month while the insurance is in effect by cancelling a necessary number of units from the unit fund. A Rs. 0.40 per thousand incidental benefit charge is payable.

Premium Allocation Charge

This is the portion of the premium taken out of the received premium to cover the expenses. The portion of the premium utilized to purchase the policy's units comprises premium allocation charges. The premium allocation charges are as follows:

Miscellaneous

Apart from the mentioned information about the policy, here are a few more important miscellaneous points to understand the policy in a better way.

Exemption

The policy’s beneficiary shall be entitled to receive the unit fund value available on the date of notification of death. Along with a death certificate if the policyholder commits suicide within one year of commencing policy or the date of revival.

Free-look Period

15 days time period the insurer provides for offline purchases and 30 days for online purchases, during which you can cancel the policy if dissatisfied with its terms and conditions.

Grace Period

If you Fail to pay the premium within the timeline, the policy offers a grace period of 30 days to pay the due premium.

Optional Riders Benefit

The LIC SIIP policy only includes the LIC's Linked Accidental Death Benefit Rider as a rider. When the insurance anniversary rolls around, the rider is an option. However, it should be remembered that the policy must be in force for at least five years and that the insured must be younger than 65. You will receive a guaranteed accidental benefit in a lump sum. It is accessible until the benefit's expiration date or policy anniversary.

The Bottom Line

LIC SIIP is a unique ULIP, combining the benefits of investing with insurance protection. It provides you with the security of a long-term and protected payment because it is a plan with guaranteed additions. The death benefit that may be given to the nominee in a single payment or instalments will be paid in the event of an unfortunate event.