LIC’s Jeevan Utsav — What you must know
LIC launched Jeevan Utsav recently — a non‐linked, non‐participating whole life savings + income plan.
| Feature | Details |
|---|---|
| Plan type | Non-linked, non-participating, individual whole life savings plan. (Liferay DXP) |
| Plan number / UIN | Plan No. 771, UIN 512N363V02 (modified version effective from 1 Oct 2024). It replaced Plan No. 871 (UIN 512N363V01). (LIAFI) |
| Premium Paying Term (PPT) | Can choose from 5 to 16 years. (Liferay DXP) |
| Age eligibility | Entry age from 30 days (in some cases; for certain PPTs may be slightly different) to 65 years. Premium ceasing age up to ~75 years. (LIAFI) |
| Sum Assured | Minimum Basic Sum Assured is ₹5 lakh. No fixed maximum limit. (mint) |
Benefit Options
After you finish paying all premiums (i.e. after the premium paying term), you start getting income benefits. There are two income options:
- Regular Income Benefit: You get 10% of the Basic Sum Assured each year. (BankBazaar)
- Flexi Income Benefit: The same amount (10% of Basic Sum Assured) is added to an accumulation with LIC, which earns interest (5.5% p.a., compounding annually). You can withdraw (once a year) up to 75% of accumulated balance, or defer it. (mint)
Also there are Guaranteed Additions: During the premium paying term, at the end of each policy year, LIC adds a fixed “guaranteed addition” of ₹ 40 per ₹ 1,000 of the basic sum assured. After PPT is over, no more additions. (PrimeInvestor)
Death Benefit & Other Assured Benefits
- On death during the premium paying term (or later), the nominee gets the Sum Assured on Death plus accrued guaranteed additions. (liafi.s3.amazonaws.com)
- The “Sum Assured on Death” is typically the higher of:
- Basic Sum Assured, or
- A multiple of the annualized premium, or
- At least 105% of total premiums paid so far. (liafi.s3.amazonaws.com)
- There is also liquidity via loan facility. (Liferay DXP)
- Surrender / paid up / lapse provisions are in policy document. Eg: surrender value rights, paid-up status, etc. (Scribd)
What “Income Benefit Starting Year” Means
Because the plan is “whole life with limited premiums”, there is a waiting (or deferment) period before income benefits start. Depending on your chosen PPT, income benefits begin after PPT + some years. For example:
- If PPT is 5-8 years, income starts at end of 11th policy year. (liafi.s3.amazonaws.com)
- If PPT = 16 years, income starts later (at end of 19th policy year). (liafi.s3.amazonaws.com)
So you need to plan based on when you start paying, when you want income, etc.
Modifications (from old version)
- The plan was earlier known as Plan 871; from 1 October 2024 the modified version Plan 771 came into effect. (LIAFI)
- Some eligibility tweaks: minimum age adjustments; surrender value rules after first year etc. (LIAFI)
Pros & Cons
Pros
- Guaranteed benefits: since non‐participating, you know what you’ll get (barring death) in terms of income after PPT.
- Flexibility: you can choose PPT between 5-16 years, two income benefit styles (regular vs flexi).
- Lifelong income: the income continues as long as you survive. It’s whole life.
- Good for those wanting fixed, predictable income after premium paying phase (e.g. for retirement).
- Death benefit guarantees to protect family.
Cons / What to watch out
- Returns are not as high as some market‐linked or participating plans with bonuses (for some, total return may seem modest when spread over long time).
- You must wait for many years before income starts — if you choose longer premium paying term, the wait is longer.
- Since non-participating, no bonus upside.
- Inflation risk: the fixed income (10% of sum assured) may lose purchasing power over very long lifetimes.
- Premiums may be high for larger sum assured; need to check affordability.
Is “10%” a Guaranteed Return?
Some marketing might suggest the “10%” regular income seems like a 10% annual return. But that’s misleading. It’s 10% of the basic sum assured, not on your total premiums always. If you calculate actual internal rate of return (IRR) over the life, especially considering the years of paying premium, waiting till income starts, etc., the real yield is lower (often in the 5-6% range for many ages/PPTs). (Stable Investor)
Who it’s good for
- People who want a guaranteed, steady income after some years (retirement, old age).
- Those who prefer less risky, more stable returns over high risk / high growth.
- Someone who can pay premiums for several years and wait for income.
- If you want whole-life cover with income streams, not just protection or lump sum only.
What to check / ask your LIC agent
- Premium illustrations for your age, sum assured, PPT, under both income options.
- Exactly when income benefit starts in your case.
- What happens on death before income starts vs after.
- Surrender value and paid-up benefits.
- Riders and additional cost of riders (if want extra cover).
- Tax implications.
