Survival benefits refer to the amount paid by the LIC to the policyholder who survives the policy term or after a certain period during the policy term. With each payout, you get to use the sum to pay for a key milestone in your life. Let's find out more about the survival benefits of LIC policies.
Every life insurance policy offers coverage throughout the policy term. If the policyholder dies within this period, his/her family gets the death benefit. But, if he/she survives the whole duration, they will get the maturity benefit.
Survival benefit, on the other hand, is an amount that is given to this policyholder if he/she survives specific years within the policy term. This amount is defined as a percentage of the basic sum assured and is fixed for each policy year.
The LIC of India offers an array of insurance and investment products to cater to the needs of a diverse range of customers. Let us take a look at the various types of plans offered by Life Insurance Corporation of India:
Tax Saving
Investment Plans
Senior Citizens
Kids Plan
Women
LIC for TAX Saving:
Enjoy the dual benefit of tax deductions under Section 80C and comprehensive insurance coverage with LIC’s tax-saving policies.
Explore LIC's top-performing plans, which provide the perfect blend of investment growth and insurance protection to achieve your financial aspirations.
LIC offers plans tailored for women, focusing on their unique needs. These plans include savings, life cover, and financial independence to secure a brighter future.
How do LIC Survival Benefits Help in Financial Planning?
Many life events are predictable, such as funding a child’s education or managing loan repayments. LIC’s survival benefits, especially in money-back plans, can be instrumental in managing these expenses. By aligning the policy payouts with your financial needs, you can better plan for and cover anticipated costs.
Unlike lump sum payouts, which require careful financial management to avoid running out of funds, LIC’s periodic survival benefits provide a structured approach to handling cash flow. These benefits ensure you receive regular payments, allowing you to maintain a steady track of your finances.
Example: Funding Your Child’s Education with LIC Survival Benefits Consider a scenario where your child will start college in 18 years. To prepare for this expense, you can purchase a LIC money-back insurance policy that begins to pay survival benefits when your child is ready to attend college.
Each survival benefit payment can be allocated towards tuition fees, accommodation, and other educational expenses. By planning ahead with LIC's money-back policy, you ensure that funds are available exactly when needed, thus reducing financial stress and helping you manage education costs more effectively.
How Are Survival Benefits in LIC Different From Maturity Benefits?
Survival Benefit
Maturity Benefit
Paid out in periodic intervals
Paid out in lump sum or installments or a combination of the two
Payouts start at the end of the premium paying term
Offered at the end of the policy term
Only a few savings-based endowment insurance plans by LIC offer survival benefits.
Every endowment insurance plan offers a maturity benefit.
Wrapping It Up!
LIC’s survival benefits offer a strategic way to manage predictable financial needs by providing periodic payouts that align with significant life events, ensuring consistent financial support when needed. While lump sum payments have advantages, periodic survival benefit with LIC policies is the best choice for someone struggling with financial planning.
Q: How can I check the survival benefit amount in LIC?
Ans: To check the survival benefit amount in LIC (Life Insurance Corporation of India), follow these steps:
Online: Visit the LIC official website and log in to your policyholder account using your credentials. Navigate to the ‘Policy Status’ or ‘Survival Benefits’ section to view the details of your policy, including the survival benefit amount.
Mobile App: Use the LIC mobile app to check your policy details. After logging in, go to the policy information section to see your survival benefit amount.
Customer Service: You can also contact LIC’s customer service or visit the nearest LIC branch for assistance. Provide your policy number and other required details to get information about your survival benefit.
Q: How do I claim my survival benefit from LIC?
Ans: To claim your survival benefit from LIC, follow these steps:
Document Preparation: Gather necessary documents such as your policy document, proof of identity, and a recent photograph. Check if LIC requires any additional documents to claim survival benefits.
Submit the Claim Form: Obtain and fill out the survival benefit claim form. You can usually download this form from the LIC website or your nearest LIC branch.
Submit the Form and Documents: Submit the completed claim form and the required documents to the LIC office or branch where your policy is registered.
Verification: LIC will process your claim and verify the details. Once the verification is complete, the survival benefit amount will be disbursed to you per the policy terms.
Q: Is the survival benefit from LIC taxable?
Ans: The taxability of survival benefits from LIC depends on the specific policy and the tax laws applicable at the time. Generally:
Tax Exempt: Survival benefits under traditional LIC policies are often tax-exempt under Section 10(10D) of the Income Tax Act, provided certain conditions are met, such as the premium paid not exceeding 10% of the sum assured.
Taxable under Certain Conditions: If the policy does not meet the criteria for tax exemption or falls under specific policy categories, the survival benefit might be taxable. Always check with a tax advisor or consult the latest tax guidelines to understand the tax implications based on your situation.
*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
^Trad plans with a premium above 5 lakhs would be taxed as per applicable tax slabs post 31st march 2023
+Returns Since Inception of LIC Growth Fund
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
++Returns are 10 years returns of Nifty 100 Index benchmark
˜Top 5 plans based on annualized premium, for bookings made in the first 6 months of FY 24-25. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in