New Bima Gold

Product summary:

LIC has introdue New Bima Gold (Plan No. 179) with effect from 4th September, 2006. It is a plan where premiums paid over the term of plan are paid back during the policy term in instalments at specified duration in case of survival of life assured and life insurance cover is available not only during the term but also during the extended term of the plan.

Extended term:
The extended term will be half of the policy term and shall commence immediately on the expiry of the term. For example for a 16 years policy term; the extended term will be 8 years with the result the total term will be 24 years. No premium are payable during the extended term of the plan.

Benefits:

Death benefit:
During the policy term: payment of amount equal to sum assured under the basic plan on death of the life assured during the policy term
During the extended term: payment of an amount equal to 50% of sum assured under the basic plan on death of the life assured during the extended term provided all the premium under the policy have been paid.
Survival benefit:

In case the life assured is surviving to the end of the specified durations, the following benefit shall be payable:
For policy term 12 years: 15% of the sum assured under basic plan at the end of each 4th policy year.
For policy term 16 tears: 15% of the sum assured under basic plan at the end of each 4th, 8th 12th policy year.

On expiry of policy term:
Total amount of premiums (excluding extra/optional rider premiums, if any) paid plus loyalty addition, if any less the amount of survival benefit paid earlier.

Loyalty addition:
This is a with-profit plan and the policy shall participate in the profits corporation's with-profits assurance business. The policy shall however, be eligible to a share of profit in the form of loyalty addition (on time) only payable on expiry of policy term. On the life assured surviving the stipulated date of expiry of policy term, the policy may be eligible for payment of loyalty addition, if any; depending upon the experience of the corporation at such rate and on such term as may be declared by the corporation.

Auto cover:
If at least two full year's premium has been paid in respect of this policy, any subsequent premium is not duly paid, full death cover shall continue for a period of two years from the date of first unpaid premium (FUP). This period of 2 during the auto-cover period, one or more installments of premiums can be paid along with interest without considering continued of the life assured.

Paid-up & surrender values (GSV, SSV):
If after at least full year's premiums have been paid in respect of this policy, any subsequent premium be not duly paid, this policy shall not be wholly void after the expiry of two years auto cover period from the due date of fist unpaid premium, but shall subsist as a paid up policy for an amount equal to the total premiums paid (excluding any extra/ optional premium) less the survival benefit paid earlier, if any. This amount shall be called as paid up value. This policy, thereafter, shall be payable on the date of expiry of the policy term or at life assureds prior death. No survival benefit shall be free from all liabilities for payment of the within mentioned premiums.

The guaranteed surrender value shall be available after completion of at least three policy years and at least full years' premiums have been paid. The guaranteed surrender value is equal to 30 percent of the total amount of premium paid for accident benefit rider and the amount of survival benefit paid earlier.

Example:
Mr. Rama Rao, aged 30 years opts for New Bima Gold (T. No.179) for 2lac S.A, paying an annual premium of Rs.7363/- for 20 years period. He receives Rs.20,000 each at the end of 4,8,12 and 16 years.

On maturity the net amount payable will be total premium paid - paid up survival benefit + loyalty addition, if any i.e. 7363 x 20 - 20,000 x 4 = 1,47,260 + loyalty addition, if any,

He will also enjoy the extended term of 10 years i.e. the term will be 20+10 = 30 years. But if Mr. Rama Rao dies after 12 years, his nominee will receive Rs.2lac without deducting the survival benefit paid to Mr. Rama Rao.