LIC Jeevan Utsav Plan 871 – A Lifetime Income Insurance Plan
LIC of India introduced a powerful savings + protection + lifelong income plan on 29th November 2023, known as LIC Jeevan Utsav Plan 871. This plan is specially crafted for those who want to ensure financial security for their family, enjoy guaranteed annual income for life, and receive insurance protection – all bundled in a single policy.
Let’s dive into the features, benefits, and working of LIC Jeevan Utsav Plan 871 in a simple and easy-to-understand way.
What is LIC Jeevan Utsav Plan 871?
- Type: Non-Linked, Non-Participating, Individual, Savings, Whole Life Insurance Plan.
- Nature: Traditional plan – not connected to the stock market.
- Goal: Lifetime income + family protection + guaranteed returns.
- Entry Age: From 90 days to 65 years.
- Premium Paying Term: Choose from 5 to 16 years.
- Policy Term: Whole Life (Till Age 100).
- Income Start Age: From as early as 18 years (depending on PPT).
- Unique ID: 512N363V01
Key Highlights
| Feature | Description |
|---|---|
| Income for Life | Get yearly income up to age 100 |
| Choice of Benefits | Choose from Regular or Flexi Income |
| Guaranteed Additions | ₹40 per ₹1,000 Sum Assured during premium term |
| Tax Free Returns | Benefits under Section 10(10D) |
| Flexible Premium Term | 5 to 16 years |
| Loan and Surrender | Available after 2 years |
Two Benefit Options at Policy Start
You get to choose one of the following options at the beginning of the policy:
Option I – Regular Income Benefit
- Get 10% of Basic Sum Assured (BSA) every year as regular income from a specific year based on your premium term.
Option II – Flexi Income Benefit
- You can defer the 10% BSA yearly income, let it accumulate with 5.5% annual compound interest, and withdraw partially or fully later.
You can switch between Regular and Flexi Income any time up to six months before the benefit starts.
Policy Parameters – At a Glance
| Parameter | Details |
|---|---|
| Minimum Entry Age | 90 Days |
| Maximum Entry Age | 65 Years |
| Maximum Premium Ceasing Age | 75 Years |
| Premium Payment Modes | Yearly, Half-Yearly, Quarterly, Monthly (via NACH/SSS) |
| Minimum Sum Assured | ₹5,00,000 |
| Loan & Surrender | After 2 full years’ premiums |
| Policy Term | 100 – Current Age |
Guaranteed Additions
- You earn ₹40 per ₹1,000 of Sum Assured every policy year during the premium paying term.
- For a ₹10,00,000 sum assured, that’s ₹40,000 per year guaranteed for 12 years (PPT = 12), i.e., total ₹4,80,000.
Survival Benefits – Lifetime Income Starts
Based on the chosen premium paying term, the income (Regular or Flexi) starts after a fixed number of policy years:
Start Year for Income Based on Premium Term
| PPT | Start Year |
|---|---|
| 5 – 8 | 11th Policy Year |
| 9 | 12th Policy Year |
| 10 | 13th Policy Year |
| 11 | 14th Policy Year |
| 12 | 15th Policy Year |
| 13 | 16th Policy Year |
| 14 | 17th Policy Year |
| 15 | 18th Policy Year |
| 16 | 19th Policy Year |
Death Benefit
In case of the unfortunate demise of the policyholder (after risk commencement), the nominee will receive:
Higher of:
- Basic Sum Assured, or
- 7 times the Annualized Premium
+ Accrued Guaranteed Additions
(Minimum 105% of total premiums paid)
If death occurs before age 8, only premiums paid (excluding taxes & rider) will be refunded.
Flexi Income Accumulation – Interest Example
Under the Flexi Income option, every year’s income (10% of BSA) can be deferred and earn 5.5% annual compound interest, which can later be withdrawn.
Withdrawals:
- Once per policy year.
- Up to 75% of accumulated fund (with interest).
- Remaining 25% continues earning interest.
Rebates and Loadings
Mode Rebate (as % of Annual Premium)
| Mode | Rebate/Loading |
|---|---|
| Yearly | Nil |
| Half-Yearly | +1.75% |
| Quarterly | +2.5% |
| Monthly | +3.25% |
High Sum Assured Rebate
| Sum Assured | PPT 5 | PPT 10 | PPT 16 |
|---|---|---|---|
| ₹10–24 Lakh | 2.5 | 1.9 | 1.3 |
| ₹25–49 Lakh | 4.5 | 3.5 | 2.9 |
| ₹50 Lakh+ | 5.75 | 4.5 | 3 |
Example – Mr. Vinod’s LIC Jeevan Utsav Plan
Details of the Plan:
| Particulars | Details |
|---|---|
| Name | Mr. Vinod |
| Age | 25 Years |
| Sum Assured | ₹10,00,000 |
| Premium Paying Term | 12 Years |
| Yearly Premium | ₹92,796 (1st Year), ₹90,798 (2nd Year onward) |
| Income Start | Age 40 (15th Policy Year) |
| Income Benefit | ₹1,00,000/year |
| Income Option | Flexi Income |
Flexi Income Accumulation Example Table
| Age | Flexi Income | Accrued Interest | Cumulative Fund |
|---|---|---|---|
| 39 | ₹1,00,000 | ₹5,500 | ₹1,05,500 |
| 40 | ₹2,00,000 | ₹11,303 | ₹2,16,803 |
| 45 | ₹7,00,000 | ₹45,468 | ₹8,72,157 |
| 50 | ₹12,00,000 | ₹90,121 | ₹17,28,680 |
| 55 | ₹17,00,000 | ₹1,48,480 | ₹28,48,120 |
| 60 | ₹22,00,000 | ₹2,24,754 | ₹43,11,185 |
Withdrawal at Age 60:
- Withdraw 75% of ₹43,11,185 = ₹32,33,389
- Remaining 25% continues to grow till age 100.
In Case of Death at Age 60
Scenario: Death at age 60 in 2058
| Death Claim Component | Amount |
|---|---|
| Death Sum Assured | ₹15,74,310 (Normal), ₹25,74,310 (Accidental) |
| Accumulated Flexi Income | ₹43,11,185 |
| Total Benefit (Normal Death) | ₹58,85,495 |
| Total Benefit (Accidental Death) | ₹68,85,495 |
Rider Options
Enhance your plan with the following optional riders:
- Accident Benefit Rider
- Accidental Death and Disability Benefit Rider
- New Term Assurance Rider
- Critical Illness Benefit Rider
- Premium Waiver Benefit Rider
Other Important Details
- Loan Available: After 2 full years
- 75% of Surrender Value (in-force)
- 50% (paid-up)
- Surrender Allowed: After 2 full years
- Paid-Up Value: Applicable after 2 years’ full premiums
- Tax Benefits: Premium under 80C; Maturity/Death/Income under 10(10D)
- Free Look Period: 30 days
- Revival Period: Within 5 years from last unpaid premium
Summary – Why Choose LIC Jeevan Utsav Plan 871?
- Guaranteed Lifetime Income
- Risk Cover up to age 100
- Option to accumulate & earn interest
- Flexibility to switch income option
- Tax-free income and death benefits
- Reliable long-term plan from LIC of India
