OBJECTIVE OF PROJECT

During my period of Internship at Insure n Invest ,I got a live exposure of style of working in an organization .I observed how different customers approach Insure n Invest for policies, how they were dealt,and provided with best suited policy for them. Moreover I worked on my project on LIC & its products, got to learn about the various guildelines and ways LIC deals with its customers. And the best selling products of LIC and its reasons.

Life Insurance Corporation of India

History of insurance in india with special referenece to LIC

Insurance in its current form has its history dating back until 1818, when Oriental Life Insurance Company was started by Anita Bhavsar in Kolkata to cater to the needs of European community. The pre-independence era in India saw discrimination between the lives of foreigners (English)
Type Government-owned corporation

and Indians with higher premiums being charged for the latter. In 1870, Bombay Mutual Life Assurance Society

Industry

Insurance

became the first Indian insurer. In the year 1912, the Life Insurance Companies Act and the

Founded

1 September 1956

Provident Fund Act were passed to regulate the insurance business. The Life Insurance Companies Act, 1912 made it

Headquarters

Mumbai, India

necessary that the premium-rate tables and periodical valuations of companies should be certified by an actuary.

Key people D. K. Mehrotra, Thomas Mathew and A. Dasgupta (MD)

However, the disparity still existed as discrimination between Indian and foreign companies. The oldest existing insurance company in India is the National Insurance Company Ltd., which was founded in 1906. It is in business.

Products

Life insurance Pensions Mutual funds

The Government of India issued an Ordinance on 19th January, 1956 nationalising the Life Insurance sector and Life Insurance Corporation came into existence in the same year(1-9-56). The Life Insurance Corporation (LIC)

Total assets

9.31 trillion (US$207.61 billion)

absorbed 154 Indian, 16 non-Indian insurers as also 75 provident societies245 Indian and foreign insurers in all.

Owner(s)

Government of India

It was in December 7, 1999 parliament passed the Insurance Regulatory and Development Authority (IRDA)

Employees

115,966 (2010)

Act which paved the way for granting licences to private sector insurance companies. After privatisation of the insurance sector more than twenty life

insurance companies have entered the business. Therefore, monopoly of LIC of India has come to an end and the Corporation has to perform in a competitive environment.

CONCEPTS OF LIFE INSURANCE, WITH SPECIAL REFERENCE TO LIC

What Is Life Insurance?

Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against.

The contract is valid for payment of the insured amount during:

y y y

The date of maturity, or Specified dates at periodic intervals, or Unfortunate death, if it occurs earlier.

Life insurance, in short, is concerned wit h two hazards that stand across the lifepath of every person: 1. That of dying prematurely leaving a dependent family to fend for itself. 2. That of living till old age without visible means of support. Life Insurance Vs. Other Savings Contract Of Insurance: A contract of insurance is a contract of utmost good faith technically known as uberrima fides. The doctrine of disclosing all material facts is embodied in this important principle, which applies to all forms of insurance.

At the time of taking a policy, policyholder should ensure that all questions in the proposal form are correctly answered. Any misrepresentation, non-disclosure or fraud in any document leading to the acceptance of the risk would render the insurance contract null and void.
3

Protection: Savings through life insurance guarantee full protection against risk of death of the saver. Also, in case of demise, life insurance assures payment of the entire amount assured (with bonuses wherever applicable) whereas in other savings schemes, only the amount saved (with interest) is payable.

Aid To Thrift: Life insurance encourages 'thrift'. It allows long-term savings since payments can be made effortlessly because of the 'easy instalment' facility built into the scheme. (Premium payment for insurance is either monthly, quarterly, half yearly or yearly). For example: The Salary Saving Scheme popularly known as SSS, provides a convenient method of paying premium each month by deduction from one's salary. In this case the employer directly pays the deducted premium to LIC. The Salary Saving Scheme is ideal for any institution or establishment subject to specified terms and conditions.

Liquidity: In case of insurance, it is easy to acquire loans on the sole security of any policy that has acquired loan value. Besides, a life insurance policy is also generally accepted as security, even for a commercial loan.

Tax Relief: Life Insurance is the best way to enjoy tax deductions on income tax and wealth tax. This is available for amounts paid by way of premium for life insurance subject to income tax rates in force. Assessees can also avail of provisions in the law for tax relief. In such cases the assured in effect pays a lower premium for insurance than otherwise.

Money When You Need It: A policy that has a suitable insurance plan or a combination of different plans can be effectively used to meet certain monetary needs that may arise from time-to-time. Children's education, start-in-life or marriage provision or even periodical needs for cash over a
4

stretch of time can be less stressful with the help of these policies. Alternatively, policy money can be made available at the time of one's retirement from service and used for any specific purpose, such as, purchase of a house or for other investments. Also, loans are granted to policyholders for house building or for purchase of flats (subject to certain conditions).

Who Can Buy A Policy? Any person who has attained majority and is eligible to enter into a valid contract can insure himself/herself and those in whom he/she has insurable interest. Policies can also be taken, subject to certain conditions, on the life of one's spouse or children. While underwriting proposals, certain factors such as the policyholders state of health, the proponent's income and other relevant factors are considered by the Corporation.

Insurance For Women Prior to nationalisation (1956), many private insurance companies would offer insurance to female lives with some extra premium or on restrictive conditions. However, after nationalisation of life insurance, the terms under which life insurance is granted to female lives have been reviewed from time-to-time. At present, women who work and earn an income are treated at par with men. In other cases, a restrictive clause is imposed, only if the age of the female is up to 30 years and if she does not have an income attracting Income Tax.

Medical And Non-Medical Schemes Life insurance is normally offered after a medical examination of the life to be assured. However, to facilitate greater spread of insurance and also to avoid inconvenience, LIC has been extending insurance cover without any medical examination, subject to certain conditions. With Profit And Without Profit Plans An insurance policy can be 'with' or 'without' profit. In the former, bonuses disclosed, if any, after periodical valuations are allotted to the policy and are payable along with the contracted amount.

In 'without' profit plan the contracted amount is paid without any addition. The premium rate charged for a 'with' profit policy is therefore higher than for a 'without' profit policy.

Keyman Insurance Keyman insurance is taken by a business firm on the life of key employee(s) to protect the firm against financial losses, which may occur due to the premature demise of the Keyman.

GUIDELINES FOR ONE AND ALL BY LIC

The Policy Bond And Its Safety The policy bond is the document that is given to one after they accept the proposal for insurance. The risk coverage commences after acceptance of the proposal and the conditions and privileges of policy are mentioned in the policy bond. This is an important document which would be referred to for various servicing interactions Keep the policy bond safe. It will be required at the time of settlement of claims on the policy. You will also require it if you are availing a loan or want to assign the policy. Inform your spouse/Parents/Children as to where the policy is kept. In case one is handing over the policy bond to any person or office, please take a written acknowledgement. Keep a Photostat copy of the policy for reference.

Policy Number The policy number is consisting of nine digits and can be found at the top left hand corner of the schedule of your policy bond. This is a unique identification number that distinguishes your policies from other policies and will remain unchanged throughout the lifetime of the policy. Remember to quote the policy number every time in the correspondence, as it helps to locate the records for reference.

Policy Conditions Every policy is taken for different types of needs; therefore the conditions for the policy will vary according to the Plan and Term of the policy. The policy schedule contains on the first page of the policy, like the ones mentioned above as well as other information like nominee, address etc. It also shows the date of commencement of
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policy, date of birth, date of maturity, due dates and months in which the renewal premiums are to be paid etc.

The second page onwards carries the various policy conditions like risk coverage, additional risks coverage if opted for, standard benefits that are available for all policies, accident benefit if opted for, exclusion of risks if any and other conditions that govern the contract of insurance.

Alterations In Policy There may be instances when one would like to make alterations in their policy like change of premium payment mode, reduction in premium paying term etc. The applications may be given in writing to the branch that services ones policy for our further action. After the policy is issued, the policyholder in a number of cases finds the terms not suitable to him and desires to change them. LIC allows certain types of alterations during the lifetime of the policy. However, no alteration is permitted within one year of the commencement of the policy with some exceptions. The following alterations are allowed.
y y y y y y y y y y y

Alteration in class or term. Reduction in the Sum Assured Alteration in the mode of payment of premiums Removal of an extra premium Alteration from without profit plan to with profit plan Alternation in name Correction in policies Settlement option of payment of sum assured by installments Grant of accident benefit Grant of premium waiver benefit under CDA policies Alteration in currency and place of payment of policy monies

A fee for the change or alteration in the policy is charged by the Corporation called quotation fee and no additional fee is charged for giving effect to the alteration.

If the Policy Is Lost Kindly make a thorough search before concluding that one has lost the policy bond. Look for the same within the residence, among your investment papers, at your office and even with your agent to whom one might have entrusted the document for some reason. It could have been even pledged with LIC/any other financial institution for availing a loan by you. LIC retains the policy bond when one go in for a loan against the policy. Make sure that the document one is searching is not one that has already been assigned to LIC, or to another financial institution. If the policy bond is partially destroyed due to natural causes like, fire, flood, etc, the remaining portion may be returned as evidence of loss of policy to LIC, while applying for a duplicate policy. In case one is sure that the policy bond is untraceable due to unknown causes, there is a simple procedure to comply with while applying for the duplicate policy at the branch. Duplicate Policy: A duplicate policy confers on its owner the same rights and privileges as the original policy. The following are the requirements for issuing a duplicate policy: 1. Insertion of an advertisement at the policyholders cost in one English daily newspaper having wide circulation in the State where the loss is reported to have occurred. A copy of the Newspaper in which the advertisement appeared should be sent to the servicing office one month after its appearance. If no objection has been lodged with LIC regarding the policy in question, a duplicate policy will be issued after complying further requirements, i.e., Indemnity Bond and payment of charges for preparing duplicate policy and stamp fee. 2. However, the requirement of advertisement and Indemnity Bond may be dispensed with or modified in certain circumstances as given below :

y y y y y y

loss of policy by theft destruction of policy by fire loss of policy while in custody of an office of government mutilated or damaged policy policy in torn and a part of it is missing policy partially destroyed by white ants

Contact Address

Ones address is very important for. Without ones latest address they would not be in a position to contact for any service offering. They would not like to keep any benefit that is due pending for want of this very important information. Whenever one shift residences, please inform the new address. Otherwise any communication they send, like premium notices, discharge vouchers for maturity and survival benefits etc., will get delayed in reaching.

LIC provides for change of addresses, inclusion of telephone numbers, mobile numbers and email addresses in ones contact addresses information. Kindly inform servicing branch to incorporate the same in ones policy records.

Admission Of Age Check the policy bond and see if the date of birth is correctly given therein. This is one of the factors on which the premiums one pay for their policy is arrived at. This would also form the basis of all future policies one might avail. In case ones earlier policies do not have date of birth incorporated and have a date of birth
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certificate issued by the competent authority, one may send an attested copy of the same to us, with a request to admit his/her age . Age Proof accepted by LIC: The Proofs of age, which are generally acceptable to the Corporation, are as under:
y y

Certified extract from Municipal or other records made at the time of birth. Certificate of Baptism or certified extract from family Bible if it contains age or date of birth.

y y

Certified extract from School or College if age or date of birth is stated therein. Certified extract from Service Register in case of Govt. employees and employees of Quasi-Govt. institutions including Public Limited Companies and Pass port issued by the Pass port Authorities in India.

Alternative Age Proofs which are accepted:

y y

Marriage certificate in the case of Roman Catholics issued by Roman Catholic Church. Certified extracts from the Service Registers of Commercial Institutions or Industrial Undertakings provided it is specifically mentioned in such extracts that conclusive evidence of age was produced at the time of recruitment of the employee.

y y y

Certificate of Birth granted by Syedna v. Molana Badruddin Sahib of Baroda Identity Cards issued by Defence Department. A true copy of the University Certificate or of Matriculation/Higher Secondary Education, S.S.L. Certificate issued by a Board set up by a State/Central Government.

Non- standard age proof like Horoscope, Service Record where age is not verified at the time of entry, E.S.I.S. Card, Marriage Certificate in case of Muslim Proposer, Elders Declaration, Self-declaration and Certificate by Village Panchayats are accepted subject to certain rules.

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Nomination Ensure that the nominees name is correctly incorporated in the policy bond. One may change the nomination in their policy any time during the lifetime of the policy In case one have not included the name of the nominee till now, please do not delay; inform the nomination immediately. Kindly note that the change of nomination has to be done in the branch that services the policy. The nominee is the person to whom the insurance claim amounts would be payable, in case anything unfortunate within the purview of the policy conditions happens. The policy is usually taken by you to benefit your family nominate the persons wholl have the welfare of your family in your absence; the usual preferences being spouse and children. One may nominate even minors like their children, in which case one have to name another person wholl have the welfare of the minor children, as an appointee. Nomination: The nominee is statutorily recognized as a payee who can give a valid discharge to the Corporation for the payment of policy monies. Nomination will be incorporated in the text of the policy at the time of its issue. After the policy is prepared and issued and if no Nomination has been incorporated the assured can ordinarily affect the nomination only by an endorsement on the policy itself. A nomination made in this manner is required to be notified to the Corporation and registered by it in its records. A nomination is not required to be stamped.

Any change or cancellation of nomination should be given in writing only by the Life Assured. Nomination under Joint Life Policy can only be a joint nomination. Nomination in favour of a stranger cannot be made as there is no insurable interest and moral hazard may be involved. Nomination in favour of wife and children as a class is not valid. Specific names of the existing wife and children should be mentioned. Where nomination is made in favour of successive nominees, i.e., nominee A failing him to nominee B failing whom nominee C, the nomination in favour of one individual in the order mentioned will be considered. Where the nominee is a minor, an appointee has to be appointed to receive the monies in the event of the
12

assureds death during the minority of the nominee. No nomination can be made under a policy financed from HUF funds.

In the case of first endorsement of nomination the date of registration of nomination will be the date of receipt of the policy by the servicing office and in case of any other nomination or cancellation or change thereof, the date of receipt of the policy and/or of notice whichever is later, will be the date of registration

Assignment In case one is raising a loan against their policy from LIC or any other financial institution, the policy would have to be assigned to LIC or the financial institution. When one assign the policy the title of the policy is shifted from his/her name to that of the institution.

The policy would be reassigned to one on the repayment of the loan. A fresh nomination should be done after reassignment of the policy. Assignment of policies can be done even when a loan is not required or for some special purposes. An assignment has an effect of directly transferring the rights of the transferor in respect of the property transferred. Immediately on execution of an assignment of the Policy of life assurance the assignor forgoes all his rights, title and interest in the Policy to the assignee. The premium/loan interest notices etc. in such cases will be sent to the assignee. In case the assignment is made in favor of public bodies, institutions, trust etc., premium notices/receipts will be addressed to the official who has been designated by the institutions as a person to receive such notice An assignment of a life insurance policy once validly executed, cannot be cancelled or rendered in effectual by the assignor. Scoring of such assignments or super scribing words like 'cancelled' on such assignment does not annul the assignment. And the only way to cancel such
13

assignment would be to get it re-assigned by the assignee in favor of the assignor.

There are two types of assignments:

1. Conditional Assignment whereby the assignor and the assignee may agree that on the happening of a specified event which does not depend on the will of the assignor, the assignment will be suspended or revoked wholly or in part. 2. Absolute Assignment whereby all the rights, title and interest which the assignor has in the policy passes on to the assignee without reversion to the assignor or his estate in any event. Re-assignment: Status of ones policy indicates if his/her policy is in force or has lapsed due to non-payment of premium. It also provides other important information with respect to your policy, for your reference. When To Pay The Premiums Remember to pay premium in time, even if the notices do not reach. There may be a postal delay. LIC usually sends premium notices one month in advance to the due month of the premium. The months in which premiums are due are given on the first page of the Policy bond.

Grace Period For Premium Payment In case one have not paid the premium within the due date there is still time for one to make the payments without payment of interest on the premium. This period is called the grace period. (With the exception of some plans) The grace period for policies where the premium payment mode is monthly is 15 days from the due date.

The grace period for policies where the premium payment mode is quarterly, half-yearly or yearly is one month but not less than30 days.
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Non-forfeiture regulations: If the policy has run for atleast 3 full years and subsequent premiums have not been paid the policy shall not be void but the sum assured will be reduced to a sum which will bear the same ratio as to the number of premiums paid bear to the total number of premiums payable.The concessions regarding claim in the above case is explained in the appropriate section.

Forfeiture in certain events: In case of untrue or incorrect statement contained in the proposal, personal statement, declaration and connected documents or any material information with held, subject to the provision of Section 45 of the Insurance Act 1938, wherever applicable, the policy shall be declared void and all claims to any benefits in virtue thereof shall cease.

How And Where To Pay The Premiums

By cash, local cheque (subject to realization of cheque), Demand Draft at Branch Office.

y y

The DD and cheques or Money Order may be sent by post. You can pay your premiums at any of our Branches as 99% of our Branches are networked.

Many Banks do accept standing instructions to remit the premiums. So by providing a standing instruction to your Bank to debit your account for the premium amount and send it vide a bankers cheque to LIC, on the due dates and months mentioned on your policy bond.
15

Through Internet : Payment of premiums can be made through Internet through Service Providers viz.HDFC Bank, ICICI Bank, Times of Money, Bill Junction, UTI Bank, Bank of Punjab, Citibank, Corporation Bank, Federal Bank and BillDesk.

Premium payment can also be made through ATMs of Corporation Bank and UTI Bank.

Premium payment can also be made through Electronic Clearing Service (ECS) which has been launched at Mumbai, Hyderabad, Chennai, Kolkata, New Delhi, Kanpur, Bangalore, Vijaywada, Patna, Jaipur, Chandigarh, Trivandrum, Ahmedabad, Pune, Goa, Nagpur, Secunderabad & Visakhapatnam. A policyholder having an account in any Bank which is a Member of the local Clearing House can opt for ECS debit to pay premiums. The policyholders wishing to use this system would have to fill up a Mandate Form available at our Branches/DO and get it certified by the Bank. The certified Mandate Forms are to be submitted to our BO/DO.

Policy can be anywhere in India: Citibank Kiosks at Industrial Assurance Building, Churchgate, New India Building, Santacruz, Jeevan Shikha Building, Borivili are dedicated for collection of premiums through cheques.

Policy status Where Available

16

Status of your policy indicates if your policy is in force or has lapsed due to non-payment of premium. It also provides other important information with respect to your policy, for your reference.

The status of your policy is available at the branch that services your policies. It is also available through our Interactive Voice Response Systems in select cities In cities connected by our computerized networks the status will be available in any of the branches.

Now the policy status of policies being serviced in the cities connected by network are also available through Internet

Revival Of Lapsed Policies If your policy has lapsed due to non-payment of premiums within the due date, the terms and conditions of the policy contract are rendered void, till you revive your policy.

A lapsed policy has to be revived by payment of the accumulated premiums with interest as well as giving the health requirements as required . Always keep your policy in force to ensure that your family gets their financial protection assured by your policy.

However certain concessions dependent on the term for which you have paid the premiums are available with the exception of some plans for claims concession.

17

Revivals: If the premium under a policy is not paid within the days of grace the policy lapses. Revival is a fresh contract wherein the insurer can impose fresh terms and conditions. A policy can be revived under the following types of revival:

1. Ordinary Revival If a revival of the policy is effected within 6 months from the due of first unpaid premium no personal statement regarding health is required and the policy is revived on collection of delayed premium plus interest. The rate of interest to be charged for such delayed premium will depend on the date of commencement of the policy.

2. Revival on non-medical basis For revival of the policy on non-medical basis the amount to be revived should not exceed the prescribed limit for non-medical assurance taken by the life assured.

3. Revival on medical basis If a policy cannot be revived under ordinary revival or revival on non-medical basis it can be revived with medical requirements. The medical requirements will depend upon the amount to be revived.

4. The other schemes for revival are

A. Special Revival Scheme B. Revival by installment C. Loan- cum- revival D. Survival Benefit- cum- revival

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Availing Loans On Policies Many of the plans are of endowment type and one would be allowed to raise a loan against their policy should one require funds. One repay the loan with interest or continue paying the interest and allow the loan to be deducted at the time of the claim payments. Further loans on policies are also allowed after deduction of earlier out standings . Most financial institutions too allow loans against LIC policies based on the value LIC quotes on request.

Policy Loans: The Corporation can grant a loan to the policyholder against his policy as per the terms and conditions applicable to the policy. The requirements for granting a loan are as under :

a) Application for loan with an endorsement of terms and conditions of the loan being placed on the policy. b) Policy to be assigned absolutely in favour of the Corporation

c) A receipt for the loan amount The maximum loan amount available under the policy is 90% of the Surrender Value of the policy (85% in case of paid up policies) including cash value of bonus. The rate of interest charged on loans is at 9% to be paid half-yearly. The minimum period for which a loan can be granted is six months from the date of its payment. If repayment of loan is desired within this period the interest for the minimum period of six months will have to be paid. In case the policy becomes a claim either by maturity or death within six months from the date of loan interest will be charged only upto the date of maturity/death

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Surrender Value This is the value which is the amount payable to one should one decide to discontinue the policy and encash the same from LIC. Surrender value is payable only after three full years premiums are paid to LIC. More over if it is a participating policy the Bonus get attached to it as per prevalent rules. Surrender of policy is not recommended since the surrender value would always be proportionately low. Should one decide to go in for another insurance at this stage further insurance would be available to one at a much higher premium because ones age would have advanced since taking out the earlier policy. Therefore retention of earlier policies and continuation of all policies without allowing them to lapse is the best strategy for continuing life insurance protection.

Maturity, Survival Benefits, Disability And Death Claims:

When ones Survival Benefits (For Money back policies) or maturity benefits are due, we send intimations to one in advance. However, if the survival benefit amount is less than or equal to Rs.60,000/- the same will be sent to one directly without policy or discharge forms with a few exceptions. If such intimations have not come to one before the due date kindly inform us so that we may take necessary action. Claims settlement procedure: The settlement of claims is a very important aspect of service to the policyholders. Hence, the Corporation has laid great emphasis on expeditious settlement of Maturity as well as Death Claims. The procedure for settlement of maturity and death claims is detailed below :

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Maturity Claims: 1) In case of Endowment type of Policies, amount is payable at the end of the policy period. The Branch Office which services the policy sends out a letter informing the date on which the policy monies are payable to the policyholder at least two months before the due date of payment. The policyholder is requested to return the Discharge Form duly completed along with the Policy Document. On receipt of these two documents post dated cheque is sent by post so as to reach the policyholder before the due date.

2) Some Plans like Money Back Policies provide for periodical payments to the policyholders provided premium due under the policies are paid up to the anniversary due for Survival Benefit. In these cases where amount payable is less than up to Rs.60,000/-, cheques are released without calling for the Discharge Receipt or Policy Document. However, in case of higher amounts these two requirements are insisted upon.

Death Claims: The death claim amount is payable in case of policies where premiums are paid up-to-date or where the death occurs within the days of grace. On receipt of intimation of death of the Life Assured the Branch Office calls for the following requirements: a) Claim form A Claimants Statement giving details of the deceased and the claimant. b) Certified extract from Death Register c) Documentary proof of age, if age is not admitted d) Evidence of title to the deceaseds estate if the policy is not nominated, assigned or issued under M.W.P. Act. e) Original Policy Document

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The following additional forms are called for if death occurs within three years from the date of risk or from date of revival/reinstatement. a)Claim Form B Medical Attendants Certificate to be completed by the Medical Attendant of the deceased during his/her last illness b) Claim Form B1 if the life assured received treatment in a hospital c) Claim form B2 to be completed by the Medical Attendant who treated the deceased life assured prior to his last illness. d) Claim Form C Certificate of Identity and burial or cremation to be completed and signed by a person of known character and responsibility e) Claim form E Certificate by Employer if the assured was employed person. f) Certified copies of the First Information Report, the Post-mortem report and Police Investigation Report if death was due to accident or unnatural cause. These additional forms are required to satisfy ourselves on the genuineness of the claim, i.e., no material information that would have affected our acceptance of proposal has been withheld by the deceased at the time of proposal. Further, these forms also help us at the time of investigation by the officials of the Corporation.

Double Accident Benefit Claims: Double Accident Benefit is provided as an inject to the life insurance cover. For this purpose an extra premium of Rs.1/- per Rs.1000/- S.A is charged. For claiming the benefits under the Accident Benefit the claimant has to produce the proof to the satisfaction of the Corporation that the accident is defined as per the policy conditions. Normally for claiming this benefit documents like FIR, Post-mortem Report are insisted upon.

Disability Benefit Claims: Disability benefit claims consist of waiver of future premiums under the policy and extended disability benefit consisting in addition of a monthly benefit payment as per policy conditions.

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The essential condition for claiming this benefit is that the disability is total and permanent so as to preclude him from earning any wage/compensation or profit as a result of the accident

Policies Under Salary Savings Scheme If one have taken the policy under salary Saving Scheme please read the following suggestions : 1. For each Salary Savings Scheme Policy ones employer deducts the premium from salary and sends a consolidated cheque for all the policies of the employees to a designated Branch of LIC, where all the policy files are maintained. 2. One can find out which Branch of LIC ones policy file will be serviced either from the Agent or from the pay roll department of the employer. 3. One will need to know which branch of LIC services ones policy because one will require their help in getting the Maturity/Survival Benefits, for any alterations like change of address and for availing loans etc. 4. In case one is in a transferable job please inform the designated Branch of LIC about his/her new place of posting. After one join his/her new place of posting please ask the employer the LIC Branch where the premiums are being remitted by his/her office there and inform the LIC Branch which was servicing you earlier so that your policy files can be transferred. 5. This way ones records will be at correct place and will receive the services from us like maturity, in time. In case one is leaving his/her employer for a new job or joining another firm, one have the facility to either continue the policy under the Salary Savings Scheme of the new firm or to convert the payment mode into quarterly, half yearly or yearly mode. 6. Always ensure the continuity of premium payments to avoid frequent revivals of policy. This may become a cumbersome process for a person who is in a transferable job. 7. Please do not send any installments directly. The premium must come through their employer only. They do not have systems to adjust single installments received from
23

our policy holders. Otherwise please convert the mode into quarterly, halfyearly, or yearly and pay directly. This way one also get a discount on the premium payable. 8. Leave a permanent local address with us so that we can reach one wherever one is even after many years.

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MOST POPULAR PLANS OF LIC

Jeevan Anand

Jeevan Anand is one of the popular plan from LIC (Life Insurance Corporation.). LIC's Jeevan Anand is a With Profit assurance plan. The plan is a combination of the Whole Life Plan and the most popular Endowment Assurance Plan. Jeevan Anand Policy provides pre-decided Sum Assured and bonuses at the end of the stipulated premium paying term, but the risk cover on the life continues till death.

Benefits:
Survival Benefits: Sum Assured along with all vested bonuses payable at the end of the premium paying term (Endowment term).

Accident Benefit: The Double Accident benefit is available during the premium paying term and thereafter up to age 70. The premium for this has been built into the tabular premium rates. Maximum accident cover available under this plan will be Rs. 5 lakh (this limit excludes accident benefit taken under other plans).

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Premium Stoppage: If payment of premiums ceases after at least three years? premiums have been paid , a free paidup policy for a reduced Sum Assured will be automatically secured provided the reduced sum assured, exclusive of any attached bonus, is not less than Rs. 250/-. The reduced sum assured will become payable on the event as stipulated in the policy.

Bonus: If it is a With Profits Policy note that every year the LIC distributes its surplus among policyholder to with profits polices in the form of bonuses. Substantial bonuses have been declared in the past after each valuation of policy liabilities.

Death Benefits: Sum Assured along with vested bonuses are payable on death during the premium paying term and when policy ceases. An amount equal to the Sum Assured is payable if death occurs after the premium paying term. Simple Reversionary Bonus accrues during the premium paying term and is payable at the end of the premium paying term or on earlier death along with final additional bonus, if any. No Bonus is paid on death after the premium paying term.

Suitablity Being an endowment assurance + whole life policy, this plan is apt for people of all ages and social groups who wish to protect their families from a financial setback that may occur owing to their demise. The amount assured if not paid by reason of his death earlier will payable at the end of the endowment term where it can be invested in an annuity provision for the rest of the policyholders life or in any other way he may think most suitable at that time. Most ideal if you want to ensure Permanent family financial protection + enjoy the fruits of your savings yourself on outliving the PPT you have chosen

26

Example: Mr. Kumar, age 25 years, takes Jeevan Anand policy for 25 years for Sum Assured Rs. 1 lakh. Now on Maturity Pankaj will receive Rs. 2,12,500/- (Rs. 1 lakh sum assured Plus Rs.1,12,500/- is the estimated bonus at Rs.45/- per thousand per year.)

In case, Mr. Kumar, dies ( After premium paying term is over) at the age of 60 years, his nominee will get additional Rs. 1 lakh equal to sum assured amount. Since Mr. Pankaj has already received the bonus, LIC will not pay second time bonus. In case, Mr. Kumar dies during the Premium Paying Term, his nominee will get Rs.1 Lakh (sum Assured) + Accrued bonus till Mr. Kumars death.

LICs Jeevan saral

Under this plan death cover will be same irrespective of age at entry and term. The sum payable at maturity however differs for different entry ages and terms. This plan is very appropriate for employees seeking life cover through Salary Saving Schemes (SSS). Benefits: On Death:
y y y y

250 times the monthly premium, plus return of premiums excluding extra/rider premium and first year premium plus The loyalty addition, if any.

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On Maturity:
y y

Maturity sum assured, plus Loyalty additions, if any.

Surrender value: The policy can be surrendered after it has been in force for at least 3 full years. The surrender value will be greater of Guaranteed Surrender Value or Special Surrender Value. Options: Jeevan Saral offers following optional riders by payment of additional premium: 1. Accidental death and disability benefit 2. Term Assurance benefit. The maximum cover for the above riders will be Rs.25 lakhs under all policies of the Corporation taken together. Auto Cover: The plan offers Auto Cover of 12 months after the policy has been in force for a period of 3 years and more. Flexible Term: The policyholder can choose a maximum term but can surrender at any time without any surrender penalty or loss. Partial Surrenders: The plan will allow partial surrender from 4th year onwards subject to certain conditions. Due to existence of the flexible term and partial surrenders the policyholder will enjoy a lot of liquidity under Jeevan saral.

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Loan: Loan is permissible under the policy. Loyalty additions: Only loyalty additions will be declared under the plan. The minimum term after which a policy can earn loyalty addition will be 10 years. However, loyalty additions will also be payable if death occurs in the 10 year of the policy provided that the policy is in force at the time of death. Loyalty additions will be subject to Corporations experience, and may be paid in case of death, maturity and surrenders. Eligibilty and conditions: Age at entry: Minimum 12 years completed and maximum 60 years nearest birthday. Age at maturity: Maximum 70 years. Term: All terms from 10-35 years. Premium: Minimum Rs.250/- per month for entry upto 49 years and Rs.400/- per month for entry age 50 years and above. The premium shall be in multiple of Rs.50 per month. Mode: Yearly/ Half yearly/ Quarterly and Monthly under Salary Saving Scheme.

Money Back Policy Table75 (20yrs) and Table 93(25yrs)

This plan is suitable for professionals and businessmen as money available at regular intervals. Once in a 5 years, a portion of SA viz., Survival Benefit is paid as a percentage. Life risk cover for the entire sum assured even after payment of survival benefit. The life assured should have attained majority at the time of first survival benefit.

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General Conditions: Min. age at entry: 13 years. Max. age at entry: 50 years. Min. S.A.: Rs. 50,000 Max. SA.: Any Amount. SA in multiples: Rs. 5000 Max. Maturity age: 70 years. Min Term: 20 years. Max Term: 20/25 years. Modes Allowed: All Accident benefit per 1000 SA: Re. 1 extra. Policy Servicing: Term Rider Option: Yes. Critical Illness Rider: Yes. Policy Loan @9%: Yes. Assignment: Yes. Revival: Yes. Surrender of Policy: Yes. Survival Benefits: Yes. Housing Load: Yes

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Benefits: y y Maturity Benefits: Bonus is given for the full sum assured amount. Death Benefits: Bonus + Full SA is paid to nominee before the policy term ends in case of death. In case of death claim, the survival benefit already paid is not deducted if any. Following reinvestment tables will give an idea of the total amount available at the end of the term. If the survival benefits are re-invested at 9% interest compounded annually in Banks/company Deposits/Mutual funds/RBI bonds etc Examples: 1. Mr. Yadav takes a Money back Policy for 25 years for rs. 1 lakh under table 93-25. he receives rs 15,000 each at the end of 5th, 10th, 15th, & 20th year. In the 25th year, he receives a balance Rs. 40,000 + Bonus of rs. 1,10,000 at an estimated Rs. 44 per 1000 SA + Final Additional Bonus of Rs 10000. Totally, Mr yadav will receive Rs. 1,60,000. the above table will gives an insight for reinvestment. In case Mr. Yadav dies during 12th year, his nominee will get Rs 1,52,800 (rs. 1,00,000 SA + Rs 52,800 Bonus). The survival benefit already paid during 5th and 10th year will not be deducted. 2. Mr. Yadav takes a Money back Policy for 20 years for rs. 1 lakh under table 75-20. He receives rs 20,000 each at the end of 5th, 10th, & 15th year. In the 20th year, he receives a balance Rs. 40,000 + Bonus of Rs. 78,000 at an estimated Rs. 39 per 1000 SA + Final Additional Bonus of Rs 7500. In case Mr. Yadav dies during 12th year, his nominee will get Rs 1,46,800 (rs. 1,00,000 SA + Rs 46,800 Bonus @ an estimated 39 per 1000 SA). The survivalbenefit already paid during 5th and 10th year will not be deducted. The survivalbenefit already paid during 5th & 10th year will not be deducted

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LICs Endowment Plan (Table 14)

It is one of the oldest and popular LIC plan. Endowment plan (Table 14) provides financial assistance to the family of the life assured in the event of policy holders early death or a lumpsum amount on policy holders survival upto the selected term. Hence, Endowment plan (Table 14) provides for family income in the event of unfortunate death of the life assured or makes provision for retirement in case of living too long. Endowment Plan is best for every reason, for all long and short term financial needs. Benefits: Natural Death: Sum Assured + Bonus for number of years premium paid + Terminal Bonus if any. Accidental Death: Double Sum Assured + Bonus for number of years premium paid + Terminal Bonus if any. Maturity: Sum Assured + Bonus + Terminal Bonus. Accident And Permanent Disability Benefit: Accident benefit is maximum Rs.50 lakh. Tax Benefit: Tax beneift on your premium u/s 80C and Maturity/Death Claim u/s 10 (10D) Loan: Loan Facility is available on this policy after 3 years, you can also use it as Housing Loan collateral. Premium Payment: You can pay premium Yearly, Half-yearly, Quarterly, Monthly or Single premium.

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Eligibility Conditions and Restrictions: Minimum age: 12 years Maximum age: 65 years Maximum age at Maturity: 75 years Min. Term: 5 years Max Term: 55 years Minimum SA: Rs.50,000/Max. Sum Assured: No Limit

Example: Mr. Rajesh buy an Endowment policy under Table-14 for Rs.1Lakh for 25 years term. He dies due to a disease after 3 yrs. In this case, Mr. Rajeshs family/nominee will receive Rs.1, 14,400(Rs.14, 400 being Bonus for 3 yrs at an estimated Rs.48 per 1000 p.a.). If Rajesh survive till maturity he would receive Rs.2,70,000 as maturity benefit (Rs.1,20,000 being Bonus for 25 yrs at an estimated Rs.48 per 1000 p.a. + FAB @ 500/- per 1000 = 50,000/-)

Amulya Jeevan
Protect your loved ones from any unexpected surprises in life, any time with Life Insurance Corporation of Indias Amulya Jeevan. Amulya Jeevan 1 (Plan No. 190) is a Term Assurance plan with minimum Sum Assured of Rs.25 lakh. Benefits: On Maturity: On Maturity no amount will be paid to the Policyholder.

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On Death: On death of the Policyholder during policy term, S.A. will be paid to the nominee, provided the policy is kept in force. Income tax rebate: The premium paid towards Amulya Jeevan 1 is eligible for tax deduction under section 80C of the Income Tax Act,1961. Eligibility Conditions and Restrictions Minimum Age at entry: 18 years (completed) Maximum Age at entry: 60 years (nearest birthday) Maximum Age at maturity: 70 years (nearest birthday) Policy Term: 5 years to 35 years Minimum Sum Assured: Rs.25,00,000/Maximum Sum Assured: No Upper Limit (Policies will be issued in multiples of Rs.1,00,000/- for Sum Assured more than the minimum Sum Assured) Loan: Not available Surrender Value: Nil Dating Back: Allowed Grace Period: 15 days Mode of Premium : Premium can be paid either in Yearly, Half-yearly & Single Premium. Cooling off period: If you are not satisfied with the Terms and Conditions of the policy, you may return the policy to Life Insurance Corporation Of India within 15 days. Example: Mr. LIC takes a policy for 25 years for Rs.50 lakhs. (a) On survival till maturity, Mr. LIC will not receive any amount. (b) On death of Mr. LIC during policy term, his nominee will get Rs.50 lakh S.A
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Komal Jeevan: (Table No.159)

LIC Komal Jeevan is a childrens Money Back Plan that provides financial protection against death during the term of plan with periodic payments on survival at specified durations. Komal Jeevan can be purchased by any of the parent or grand parent or legal guardian for a child aged between 0 year to 10 years. The payment of the premium stops at the age of 18 years. Suitablity: In todays competitive world, every parent dream for best education for their son/daughter. This policy is suitable for parents who dream to secure money for their childrens higher education. Benefits: The policy matures when the child grows up to be 26. Once the child attains majority, the survival benefit is paid in four installments. 1. 20% on policy anniversary after completing age 18. 2. 20% on policy anniversary after completing age 20. 3. 30% on policy anniversary after completing age 22. 4. 30% on policy anniversary after completing age 24. 5. Guaranteed addition + Loyalty Addition on completing age 26 (Maturity date) Guaranteed additions : The policy gives guaranteed additions at Rs 75 per Rs 1,000 sum assured on every policy anniversary till age 26.

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Commencement of risk cover: The risk commences only after the child attains age seven or two years after the commencement of the policy, whichever is later. Premium Waiver Benefit: Premium Waiver Benefit available with some extra premium amount. Term Rider Benefit: Term Rider Benefit can be availed by the proposer to the extent of 20% of the basic sum assured under the policy not exceeding Rs.1,00,000/-. The benefit will be payable in case the proposer dies before the policy anniversary on which the child is 18 years last birthday. Death Benefits
y

In case of death of life assured before the commencement of risk, the policy is canceled and premiums paid are refunded.

After the commencement of risk, if the life assured dies before policy matures, full sum assured plus guaranteed additions are payable without deduction of earlier installment benefits paid.

Special benefit in maturity: Loyalty additions depending on policy duration and sum assured are paid on maturity.

Mode of premium Premiums are payable yearly, half-yearly, quarterly, monthly or through Salary deductions, as opted by you, up to the policy anniversary immediately after the life assured (child) attains 18 years of age or till the earlier death of the life assured. Alternatively, the premium may be paid in lump sum (Single premium). Eligibility Conditions and Restrictions Min. age at entry: 0 year (Last Birthday) Max. age at entry: 10 years (Last Birthday). Min. S.A.: 1 lakh. Max. SA.: 25 lakhs.
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SA in multiples: Rs. 25,000 Max. Maturity age: 26 years (lbd) Min. PPT: 8 years. (Premium Paying term) Max. PPT: 18 years. Accident benefit: NA Term Rider Option: Available Critical Illness Rider: No Policy Loan: No Revival: Yes Surrender of Policy: Yes Survival Benefits: Yes Housing Loan: No

New Bima Gold (Table No.179)

Gold never loses its value, just like LIC Of Indias New Bima Gold insurance policy. LICs New Bima Gold (plan no.179) is a special with profit money back plan that offers 50% of the life cover during extended term even after maturity. Benefits: Survival Benefit: Payable in case of life assured surviving to the end of the specified durations provided the policy is in full force as given below: For policy term 12 years:15% of the Sum Assured under Basic Plan at the end of each 4th & 8th policy year. For policy term 16 years:15% of the Sum Assured under Basic Plan at the end of each 4th, 8th &12th policy year.

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For policy term 20 years:10% of the Sum Assured under Basic Plan at the end of each 4th, 8th, 12th & 16th policy year. On expiry of policy term:Total amount of premiums (excluding extra/optional rider premiums, if any) paid plus Loyalty Additions, if any, less the amount of survival benefits paid earlier. Death Benefit: During the policy term: Payment of an amount equal to Sum Assured under the Basic Plan on death of the Life Assured during the policy term provided the life cover is in force. 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 premiums under the policy have been paid. Extended Term: The extended term shall be half of the policy term after the expiry of the policy term. Mode of Premiums: Regular premium can be paid either in yearly, half yearly, quarterly or monthly (ECS) installments.

Eligibility Conditions and Restrictions : FOR BASIC PLAN: 1. Minimum age at entry: 14 years (completed) 2. Maximum age at entry: 57 years (nearest birthday) for Term 12 years 3. Maximum age at entry: 51 years (nearest birthday) for Term 16 years 4.Maximum age at entry: 45 years (nearest birthday) for Term 20 years Age at expiry of extended term: Maximum 75 years (nearest birthday) Policy Term: 12, 16 and 20 years.

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Minimum Sum Assured: Rs. 50,000 /Maximum Sum assured: No limit Sum Assured will be in multiples of Rs.5,000 /- only. FOR THE ACCIDENT BENEFIT RIDER OPTION : 1. Minimum age at entry: 18 years (completed) 2. Maximum age at entry: 57 years (nearest birthday) for Term 12 years 3.Maximum age at entry: 51 years (nearest birthday) for Term 16 years 4.Maximum age at entry: 45 years (nearest birthday) for Term 20 years Minimum Sum Assured: Rs. 50,000 /Sum Assured will be in multiples of Rs.5,000 /- only. Cooling off period: If you are not satisfied with the Terms and Conditions of the policy, you may return the policy to LIC of India within 15 days.

Jeevan Mithra (Triple Benefit)

Sum Insured + Bonus Accrued For the Policy Term chosen, on your surviving the premium payment term you have chosen (15 to 30 years),

3 times the basic sum Insured + Bonus accrued on the basic sum insured in case you do not outlive the premium payment term you have chosen ( 15 to 30 years)

4 times the basic sum insured in case death is due to accident against a little extra,
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Waiver of further premium payable + Basic Sum Insured spread over in the form of an Annuity for next 10 years + All other Maturity benefits in case of Total and Permanent Disability due to Accident,

Loan against surrender value at 9.00% per annum simple interest,

Benefits
y Financial security available to your nominee in your absence during the currency of the plan is maximum, y Maturity Benefit available should you outlive the PPT you have chosen is quite impressive, y Premium paid qualifies for Section 80 C benefit within the overall limit of Rs 1 Lakh per annum allowed for various savings, y Policy proceeds received by you on surviving the PPT chosen are free from income-tax under section 10(10D) of the I.T Act. y Policy loans available under the plan offer you additional investment facilities without effecting any of the policy privileges, y Most ideal as a collateral security while drawing housing or any capital loans in view of the high security it offers

Premium Paying term y 15 to 30 years ceasing at death, if it occurs early.

Modes of investment y Yearly, Half-yearly or Quarterly or Monthly.

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Jeevan Tarang

Cash value of bonus on the full sum insured + Annual Installments @ 5.5% of the sum insured upto your 100 years of age + Sum Insured whenever you are not alive instead of annual installments, without any deduction towards installments already paid + Loyalty Addition if any, on your surviving the premium payment term you have chosen (10 or 15 or 20 years),

Sum Insured + Bonus accrued in case you do not outlive the premium payment term you have chosen ( 10 or 15 or 20 years)

y y

Loan against surrender value at 9.00% per annum simple interest, Additional sum equal to face value but not exceeding Rs 50 Lakhs in case of fatal accident against a small extra,

Premium waiver in addition to the above accident benefit in case of Total and Permanent Disability due to Accident against a small extra,

Term Cover Rider against extra

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Benefits 1. Under this plan, your nominee is assured of the face value of the policy on your death whenever it occurs within your 100 years of age. Your premium payment however is limited only for the term chosen (10 or 15 or 20 years). 2. You are assured of a regular annual income as long as you are alive upto a maximum of 100 years of age, once you outlive the premium payment term you have chosen. By going for LIC's Jeevan Tarang every month, you can reduce the frequency of annual installments to monthly also. 3. From income-tax point of value also, you stand to gain quite a bit through LIC's Jeevan Tarang investment. While the premium paid qualifies for Section 80 C benefit within the overall limit of Rs 1 Lakh per annum allowed for various savings, annual installments received as above are free from income-tax, since they are nothing but settlement options on the sum insured exercised by you. In otherwords, under LIC's Jeevan Tarang,you are assured of a tax-free annuity @5.5% of the sum you have insured for rest of your life, once you outlive the PPT chosen. 4. Bonus available before commencement of Annuity can be profitably invested to fetch you income additional to annuity installments available under the plan. 5. Policy loans available under the plan offer you additional investment facilities without effecting any of the policy privileges.

Premium paying term y 10 or 15 or 20 years ceasing at death, if it occurs early.

Modes of Investment y Single, Yearly, Half-yearly or Quarterly or Monthly

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Anmol jeevan-I

Life Insurance Corporation Of Indias Anmol Jeevan-I (Plan No. 164) is a unique plan of assurance, by far the cheapest policy to buy; cheaper than even a whole life policy to start with. Anmol Jeevan-I is a pure term cover provides only life cover unlike endowment and money back policies which have a built-in saving element too. Eligibility Conditions and Restrictions Minimum Age at entry: 18 years (completed) Maximum Age at entry: 55 years (nearest birthday) Maximum Age at maturity: 65 years (nearest birthday) Policy Term: 5 years to 25 years Minimum Sum Assured: Rs.5,00,000/Maximum Sum Assured: Less than 25,00,000 /(Policies will be issued in multiples of Rs.1,00,000/- for Sum Assured above the minimum Sum Assured) Loan: Not available Surrender Value: Nil Dating Back: Allowed Grace Period: 15 days Payment Of claims: No Claims concession will be applicable to this Policy.

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Benefits of investing On Maturity: On Maturity no amount will be paid to the Policyholder. On Death: On death of the Policyholder during policy term, S.A. will be paid to the nominee. Income tax rebate: The premium paid towards Anmol Jeevan-I is eligible for tax deduction under section 80C of the Income Tax Act,1961. Modes of investment Premium can be paid either in Yearly, Half-yearly & Single Premium. Example: Mr.ABC takes a policy for 20 years for Rs.20 lakh sum assured. (a) On survival till maturity, Mr. ABC will not receive any amount. (b) On death of Mr.ABC during policy term, his nominee will get Rs.20 lakhs S.A.

Jeevan Arogya

It is LICs mediclaim policy available for all Indian Investors for hospitalization in India due to either accident or sickness for a period exceeding 24 hours. Every block of 4 hours or more is deemed as one day. It is not a regular life insurance policy. There is no maturity benefit or death benefit.

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Benefits 1. Hospital Cash Benefit (HSB) under which there is cash reimbursement equivalent to Applicable Daily Benefit (ADB) that starts with a minimum of Rs 1000/- to Rs 4000/per day, increasing by 5% every year, reaching a maximum of 150% . Only Condition for this reimbursement is, hospitalization either for accident or sickness beyond 24 hours. Every block of 4 hours is deemed as 1 day. In case of treatment in an ICU, this benefit is doubled. 2. No Claim benefit , 3. Major Surgical Benefit (MSB) under which there is cash reimbursement upto MSB Sum Assured for listed major surgeries, 4. Daily Hospital Cash Benefit (DHCB) under which there is a lumpsum amount equl to 5 times the ADB applicable, regardless of the actual costs incurred for Day Care Procedure, 5. Cash reimbursement equal to 2 times the ADB per day in case of non-listed surgeries, 6. Ambulance facility or Rs 1000/- in lieu of ambulance expenses, 7. Waiver of premium for 1 year in case of major surgeries.

Premium Paying term Upto your 80 years of age . Income-Tax benefit Premium paid every year enjoys income-tax exemption upto Rs 15,000/- per individual or Rs 30,000/- for the family members

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Reasons to invest y y Medical benefit is available upto your 80 years of age without any interruption, Medical benefit can be extended to all family members including parents and parents-inlaw in the age group 0-75 under a single policy, y 50% of the claim amount can be drawn in advance for meeting surgical procedures instead of waiting for the claim to be made. y ADB keeps increasing every year by 5%, reaching a maximum of 150%. As a result, other benefits like HCB and MSB also stand increased. y HCB can be availed every year upto a maximum of 30 days or as a lifetime benefit upto 720 days.

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Tax benefits with LIC

INCOME-TAX AND TAX BENEFITS FROM LIFE INSURANCE

A] INCOME-TAX RATES FOR ASSESSMENT YEAR 2011-2012 (FINANCIAL YEAR 2010-2011)

Income Slabs:
Individual & HUF below age of 65 years Income upto Rs.1,60,000 Rs.1,60,001 to Rs.5,00,000 Rs.5,00,001 to Rs.8,00,000 Above Rs.8,00,001 Woman below age of 65 years Income upto Rs.1,90,000 Rs.1,90,001 to Rs.5,00,000 Rs.5,00,001 to Rs.8,00,000 Above Rs.8,00,001 Individual above age of 65 years Income upto Rs.2,40,000 Rs.2,40,001 to Rs.5,00,000 Rs.5,00,001 to Rs.8,00,000 Above Rs.8,00,001 30% 20% 10% NIL Tax Rates

Education Cess : An additional surcharge called as Education Cess is levied at the rate of 2% on the amount of Income tax and surcharge (if any) in all cases shall be levied. Secondary and Higher : An additional surcharge, called the "Secondary and Higher Education Cess on income- at the rate of 1% of income-tax and surcharge (not including the Education Cess on Income-tax) in all cases shall be levied.

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B] SOME IMPORTANT INCOME TAX BENEFITS AVAILABLE UNDER VARIOUS PLANS OF LIFE INSURANCE ARE HIGHLIGHTED BELOW: 1) Deduction allowable from Income for payment of Life Insurance Premium (Sec. 80C). (a) Life Insurance premia paid in order to effect or to keep in force an insurance on the life of the assessee or on the life of the spouse or any child of assessee & in the case of HUF, premium paid on the life of any member thereof, deduction allowed upto 20% of capital sum assured during any financial year. (b) Contribution to deferred annuity Plans in order to effect or to keep in force a contract for deferred annuity, on his own life or the life of his spouse or any child of such individual, provided such contract does not contain a provision to exercise an option by the insured to receive a cash payment in lieu of the payment of annuity is eligible for deduction. 2) Investment under long-term infrastructure bonds notified by the Central Government. (Sec. 80CCF) A deduction up to Rs. 20000/- is available to individuals and HUF for amount paid or deposited as subscription to long-term infrastructure bonds notified by the Central Government. This is in addition to Rs. ! lakh deduction available under section 80C. 3) Deduction under section 80D 1. Deduction allowable upto Rs.15,000/- if an amount is paid to keep in force an insurance on health of assessee or his family (i.e. Spouse & children) 2. Additional deduction upto Rs.15,000/- if an amount is paid to keep in force an insurance on health of parents 3. In case of HUF, deduction allowable upto Rs.15,000/- if an amount is paid to keep in force an insurance on health of any member of that HUF Note: If the sum specified in (a) or (b) or (c) is paid to effect or keep in force an insurance on the health of any person specified therein who is a senior citizen, then the deduction available will be upto Rs.20,000/-. provided that such insurance is in accordance with the scheme framed by
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a) the General Insurance Corporation of India as approved by the Central Government in this behalf or; b) Any other insurer and approved by the Insurance Regulatory and Development Authority.

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Bibliography
Sites: y y y y y www.licindia.in www.bimadeals.in www.licplans.blogspot.com www.mylicindia.com www.licindiaagent.com

Books: y Life insurance(IC-33) y Risk Analysis & Insurance Planning-ICOFP y Manual for agents-LIC

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