LIC’s Jeevan Rakshak (Plan No.827)-Whose Rakshak is this?

LIC will be coming with one more endowment plan called Jeevan Rakshak (Plan No.827) from 19th August 2014. It is a typical traditional plan and let us discuss about its feature and review.

This is a regular premium paying non-ULIP with profit endowment plan. The total Sum Assured under all policies issued to an individual under this plan shall not exceed Rs.2 Lakh. I do not know why they set such limit.

Below are the plan eligibility and features of the plan.

LIC's Jeevan Rakshak (Plan No.827)

Death benefits-

If death occurs of the life assured during the policy period then higher or below will be payable.

  • Basic Sum assured
  • 10 times of your annual premium
  • 105% of all premiums paid as on death.

Along with the above said benefit nominee will be entitled for Loyalty Addition if death occurs after completion of 5th Year.

Maturity benefits-

Sum Assured along with Loyalty Addition will be payable.

Other features of this plan

  • You have the option to opt for the accidental rider benefit.
  • You will get a premium rebate of 2% for yearly premium and 1% for half-yearly premium.
  • High sum assured rebate of 1.5% if you opted for more than Rs.1, 50,000 Sum assured.
  • Offers guaranteed surrender and special surrender.
  • If you surrender before maturity, then one will be eligible for LA.

Will you buy it?

  • A typical endowment plan with high expenses (see above table for the agent’s commission and along with that you need to bear some other expenses too). So expect a savings account return.
  • Maximum Sum Assured restricted to Rs.2, 00,000. Therefore, I will not call it as an Insurance product. With such low insurance coverage for how many days, dependents can survive.
  • Benefit in this plan will be as a Loyalty Addition. Therefore, if you look at Jeevan Saral LA rates or some other plan LA rates, then I do not think this plan will give you tremendous return.
  • LA will be payable only in case of death occurs after 5 years. So if within 5th year then you need to satisfy with death benefits as mentioned above.
  • LA will not be payable in case of surrender. This makes risky to enter this policy. What if someone have emergency?

So over all I may say it is another waste product from LIC. Let us discuss further once we get the premium table too. However, in my view I am expecting a bit cheaper premium rate.

107 Comments

  1. I buy jeevant rakshak policy on my daughter pay premium 3 years her age 13 and I want surrender this policy who’s neft form require myself or my daughter

    Reply
    • Dear Nilesh,
      As you are a proposer, your NEFT details required.

      Reply
  2. I want to buy policy for my wife. She is 32 yrs. Please let me know which is fine so that she can good return end of the maturity

    Reply
    • Arindam-First decide yourself of whether you need investment or insurance. If your idea is insurance, then buy term insurance. If idea is of investment, then stay away from such insurance+investment products.

      Reply
  3. Basavaraj sir i am afraid about my invest in lic jeevan rachak 827 plan .kidly suggest me is it fine.

    Reply
    • Pankaj-It is fine only if you feel 5% to 6% is BEST return for you.

      Reply
    • Mr. Pankaj don’t worry because any insurance policy is give us “Insurance” not return , when you get your money at end of policy , this will be a increased money that you have paid ,

      Think- if any one paid premium for three year Rs. 4000/year (total paid 12000) & he is not live due to accident , Now LIC company will give to his/her nominee Rs. 400000 ( 4 Lac) . Now what % is return of this policy . ( S.A. 2 Lac Only )

      You should happy that you are live & also get your paid money with good Bonus.

      Reply
  4. Good job sir. What what about LIC new jeevan Anand. I have take this plan.
    S.A 1 lac
    Terms 35 years
    Quarterly premium 843
    . agent told me that I received about 4 lacs.

    Reply
    • RK-You already bought it believing that agent’s claim of Rs.4 Lakh is true. Whether you cross checked his claim? Let me know how your agent arrived at this value of maturity amount.

      Reply
      • Hi,

        I assume his age is around 25 or less and he has taken New Jeevan Anand with Profit 815 policy, where he will be paying around 900 quarterly and calculation should be like below,

        Sum Assured – 1 Lakhs
        Bonus on maturity – 171500 (49/1000 SA, hence 4900 / year and for 35 years it turns around 171500 for 1 Lakh)
        Final Additional Bonus – 185000 (1850/1000 SA – Hence 185000 for 1 Lakh)
        Total – 456500

        Correct me If I’m wrong,

        Thanks
        Abdul

        Reply
        • Abdul-Your calculation is correct. But investing around Rs.1 lakh and getting Rs.4 lakh seems attractive right? But at what cost? You are getting this amount after 35 years. Do you know how much return you get? It is around 6%. Nowadays even a savings account provides you around 5% to 6% return then why should you have to invest in such illiquid product? Also, what will be the value of Rs.4,56,500 after 35 years? It may be your few days household expenses.

          Reply
  5. Dear Sir,

    My Friend which is a LIC Agent forcely giving me LIC Jeevan Rakshak Plan. As I am from a Rural area of Marathwada Region of Maharashtra State. I know nothing about Insurance. I am from a poor family. I have two sons 3 and 1 year old.

    I just get Jeevan Rakshak
    TERM 15 Years, Yearly Premium Rs. 10061 + Service Tax Rs. 302 and SA is 200000/-
    and my friend says after 15 years I will get Rs. 4,50,000 to 5,00,000 is it true.
    reading the articles on different sites I am afraid that it is not true.
    Verry sorry for my english.
    Hoping for reply.
    I hope you will be understand my situation.

    Thank You

    Please, mail me, I am eagerly waiting

    [email protected]

    Reply
    • Ram-Even if you get Rs.4,50,000 after 15 years then you feel a great return or great investment? Think yourself.

      Reply
  6. hello basu sir,

    can you please elaborate on Loyalty Addition as i am confused on it.

    Is this LA is done only once in the whole insurance policy in the year in which we purchase this.

    one more thing which i would like to ask is my sister has taken this jeewan rakshak policy for 20 years and her basic sum assured is Rs. 75,000. she has opted for quarterly premium payments. her instalment premium for basic plan is Rs. 666.63 and rider instalment premium is Rs. 9.37 which makes it to Rs. 676.00.
    she has tution income of Rs.1500/month.

    so my question is how much amount she will get on 25/08/2034 as premium is payable till 25/05/2034.

    Reply
    • Anant-LA will be payable at end of policy either at maturity or claim, but not at beginning of a year. Return from your sister’s policy will be around 5% to 6%.

      Reply
  7. Well I really fail to understand why Financial planners fail to differentiate between category of the products and their intended benefits. All they focus is on ROI( Return on Investment). Dear , I would like to make it very clear that Insurance is a separate domain of financial planning. Its prime objective is risk coverage and to minimise the financial loss in the event of untimely and unfortunate loss of the bread earner. If your just view all the products by the prism of ROI , a justified conclusion can not be reached upon. There are many people in the society for whom 2 lakhs is a big sum. LIC being a business as well as social organisation, its aim is to reach to every strata of the society.
    Yes, I am an officer of LIC and not an agent. There are various products in LIC catering to the need of people of varying financial capacity( in terms on Insurance). There are pure term insurance products which offer nothing after survival.But they offer huge sum assured at very less premium the case of death.If you reject these plans purely because the ROI is zero at maturity then you seriously need to think about your understanding of the financial planning.
    Compare the products after viewing what category they fall into and then make an analysis to what extent they serve their intended purpose.If you have everything as ROI, then please insurance is not your thing. Concentrate on other financial instruments with no element of insurance. And moreover, not all people are experts in FP, they sometimes look for easier products to safeguard their interests. LIC just provides an option and if you see the premium and the quantum of risk coverage, Jeevan Rakshan is a nice product to go for. Ad if possible show me some other Insurance products that covergood amount risk and offer huge over 9% return as well.

    Reply
    • Sumeet-Thanks for coming into picture 🙂 I fully agree with your views on importance of insurance. I have few questions for you. Being a family member of India’s top insurance company, please try to answer for the benefits of all.
      1) Do you consider this product as insurance or investment?
      2) If insurance then do you feel your agent force will actually sell this product to those people who only need of insurance is Rs.2 lakh?
      3) If you consider as investment then do you feel it is worst to get negative real return??
      4) I considered ROI because I felt this product as investment rather than insurance. Because even in small village, for how many years one’s family member survive with the insurance claim amount of Rs.2 lakh?
      5) 90% return????? Can you elaborate more about the method you adopted for calculation? I am more eager to know about this 9% method of calculation. In fact more eager to invest myself 🙂

      Reply
      • Dear Basu
        Lets start with your point No.5. I would have liked it more had you read that carefully. I was talking about 9% , not 90% and moreover, I was asking you to suggest me the insurance plan which provides more than 9% return as you were being sceptic about Jeevan Rakshak.
        1. This product is Insurance which provides for decent returns even if you call it 6% return.:)
        2.This product has been designed keeping in vi the emium would be affordable to a large mass. Ofcourse our Agents will sell this product to those whose insurance need is more than 2 lakhs. A liitle sense is required to understand there are other products as well. Since this product is not clubbed with other plans for the purpose of calculation of SUC, this provides for additional cover. If you can afford Mercedes, having an Alto 800 is no sin:)
        3 &4. This is absolutely ridiculous to even say that. Since writing blogs is easier , you need to understand the value of 2 lakhs. I have seen tears of happiness and relief when poor people get even Rs. 50000/- cheque in hand.2 lakhs is really a big deal for them. Who asks you to be covered for 2 lakhs only. Go for higher cover if you can pay for that.There are other plans for that.
        Have you ever seen the premium rates? Compared it with other insurance products? If you say insurance is bad then I can agree with your concept. Else, you should appreciate the fact that with this product LIC has tried to accommodate maximum people in the ambit of insurance.
        I hope you too must be having some plan from LIC( with lower ROI though..:P)
        I welcome your further comments over this and I am quite interested to know to what extent do you undermine the value of insurance.:)

        Reply
        • Sumeet-Let me know which insurance plan will give me even 9% of return too. I will ready to invest. Please share details for benefits of all with your calculation method. 6% decent return? How about investing the same in savings accounts which few banks offers around 5%-6% return? Ha ha…good example of Mercedez to Alto. But do your agents fraternity of the so called LIC officials understand this logic? When nothing is there then even Rs.50,000 seems to bigger for families. But you being in insurance industry providing the right support with just Rs.50,000 or to say Rs.2,00,000 suffice for how many days? Especially considering the inflation rate (not urban but rural also). Wow…..each product LIC designs will come up with the logic that to accommodate maximum people in ambit of insurance. But sadly neither agents nor the so called officials understand the value of insurance. LIC ki jai ho….:) I too having LIC plan? I challenge you to check your LIC database with my name 🙂 I CHALLENGING you, because you claimed to be LIC’s official. If you come up with plan issued in my name then let me know please…not for continue but to surrender. For your information, I am not undermining the value of insurance. But totally undermining the concept which sells product in the name of insurance which gives return of savings account.

          Reply
          • Lolz…You definitely seem to have the habit of overlooking the finer points. Your stress a lot on not so necessary things. I was just hoping you would be having an Insurance plan with LIC which you dont have and congratulations to you for this.:P
            My dear blogger, I am not suggesting you any plan rather asking have you come across any other Insurance plan which gives more than 9% return.Forget LIC for the moment. Name me any plan from any company which gives returns more than the inflation. So do you mean to say the Insurance is an useless product if it cant give you more than 9% returns. Hahaha.
            As far as I know, I havent come across any Insurance plan which apart from covering risk gives you returns like Mutual Funds or equity. My dear knowledgeable blogger, do you suggest that Insurance is a useless thing??
            Hahah good to see you saying LIC ki jai ho. Truly LIC ki jai ho.Dear friend, widen your horizon and dont make your financial planning compartmental. Insurance is the need of everyone’s life even if it give you less returns. Your Bank’s saving account wont give you the the coverage in the event of some mishappening. Give proper room to the need of insurance and combine it with other investment avenues to maximise the gain. Dont compare Daal roti with pizza and burger.
            I wish you all the best. After all you need to do something for a livelihood.:)

            Reply
            • Sumeet-For your information I am considering insurance only for insurance purpose. So I pay to pure insurance premium not to any product which combines insurance with investment. Hence I will not accept the return. I buy it for protection by paying the pure mortality charge and expect only life risk. Now you are dwindling between importance of insurance with return part. First mind up your mind about whether you are giving advice on insurance or investment. You including agents have habit of selling a product mentioning the importance of insurance but which is insurance+investment. Do you feel any of other traditional plans whether they are from LIC or other insurers provide return of 9%? Reason is, if one investing Rs.100 then in first year 35% to agents, 2-3 year 7.5% and from 4th year onward 5%. So if we consider this alone expenses (forget about other investment LIC need to bear regarding traditional plans). Then do you know how much return LIC must generate to at least give 9% return to investors??

              As I said 100 times, I never under estimate the importance of insurance. But hate the product which combines insurance+investment and under insurance once life, also provides the return which even can’t beat inflation. So now by reading comments from both of us let readers decide who are at right 🙂

              Reply
          • Ahh I missed another point here. You keep on saying how long will 50000 suffice or 2 lakhs suffice. I have really come across such a foolish question after long time. HAHAHA. Do you know the concept of HLV(Human Life value)? Or you want LIC to provides someone with yearly income of 2 lakhs paying yearly premium of Rs. 7000 a life cover of say 5 crores ?? Lolz hope then it will suffice for a long time and then only LIC will win some good words from you. you are a CFP and you miss this gross point again and again that this is not the only thing LIC offers. If you go to purchase a shirt do you cry foul there that how long will this shirt give me the cover. I want the entire shop in the price of one shirt.Lolz. I have made my point and readers of your blog would have got some idea after reading our conversation. Let them decide what’s best for them . LIC ki jai ho. And I have other things to do rather than searching a fool’s name in LIC data base.LOL. I was literally laughing by your confident way of CHALLENGING me to find your name in the database.:D Goodluck friend!

            Reply
            • Sumeet-Thanks for your wonderful comment about my question 🙂 Again and again lecturing on importance of insurance….but selling a product which neither suffice insurance nor return 🙂 Great logic LIC official. keep it up 🙂

              Reply
              • Thanks dear Friend!! I know where LIC stands, You know where LIC stands and people like you have been trying hard unsuccessfully to tarnish the image of LIC. May be you are some kind of undercover agent hired to do this.HahahaScribbling will not help. And I know my logic.Happy earning and blogging Certified Financial Planner..:P lolz

                Reply
                • Sumeet-Thanks for giving me that tag called “Undercover agent hired to do this” 🙂 But to your surprise I am LIC agent 🙂

                  Reply
                • What a discussion. When I finished I felt like that was the article of this post. Anyway I am not a finance person, rather a common salaried man who learned by my mistakes and blogs like this. And off-course using my own brain after reading everything.

                  So, from a common man point of view I can say that we have better options in market to get more benefits considering all insurance + investment knowledge. Why too much promotion of LIC? I am not against LIC. But their approach to swipe people’s mind with sentimental discussion is not at all good. I know it very closely as one of my close relative is a LIC agent.

                  Every company is launching so many products, they can only explain us how it can be beneficial us. But can’t force us to think that there is no other options beside this.

                  I am not taking any one’s part here. But just want to add my view as a common man after knowing many facts about about these financial products.

                  Here I want to through a simple question to all the reader and insurance agent of LIC :
                  Why don’t you tell about the e-term plan to public rather than this ULIP plans? I think buying e-term is far better than buying any other lic policy. At least one quota of responsibility will 100% complete for that guy.

                  Reply
                  • Santanu-Thanks for your views and ideas 🙂 I really appreciate the way you commented.

                    Reply
  8. Hi BasavaRaj,
    Well, I already a posted a question regarding Jeevan Rakshak plan but im not able to trace out that in which article i have posted it, anyways here its my question.
    Well if i go for a jeevan rakshak plan of sum assured 2 lacks for 10 yrs and im 30 years old… So can u tell me roughly that how much am i going to pay as in premiums for overall 10 yrs and what is the amount I can expect after the policy gets matured…
    Thanking you in advance.

    Reply
  9. Hi Basavaraj,
    Well im here to discuss about Jeevan Rakshak policy, lets say im planning to go for sum assured 2lacks for 10 years, so could you help here that what will be the total amount i would be getting once it gets matured???
    Thank you in advance…!

    Reply
    • Sri-This being a typical traditional insurance plan, you can expect returns of around 6%.

      Reply
  10. Thanks All for sharing so much of Insight…. I need a simple help……Need to Buy LIC policy for age 30 to work as retirement plan or lumpsum money. I am putting money in PPF which is not an issue. Which on should I buy. I can even look at the combination of plan which normally people talks about. Can you please help mein buying one, I know there are many options but I want it to be with LIC as private sector is too risky. Look forward for a detail reply as you did in above points.

    Reply
    • Ricky-Sadly no such retirement building plans available in LIC.

      Reply
  11. FOR 200000 POLICY, 30Y AGE PRIMIUM IS 7000
    MY QUESTIONS ARE…..
    [1]
    HOW MUCH LOYALTY ADDITION WILL YOU GET 42 OR LESS PER 1000?????
    [2]
    HOW MUCH MATURITY WILL U GET IF TERM IS 20 YEARS 300000/350000/368000 ??????????
    [3]
    IN CONVETIONAL PLAN{LIKE J.ANAND} IF YOU INVEST 7000 YEARLY YOU WILL GET 100000 SA. MEANS MATURITY AMOUNT IS 100000+LOYALTY
    BUT IN THIS PLAN, WE WILL GET 200000 INSURANCE MEANS MATURITY AMOUNT IS 200000+LOYALTY…
    SO THIS WILL BE 100000 BENIFIT… SO THIS MUST BE EXTRAORDINARY PLAN .
    WHY R U REFUSING FOR THIS PLAN.
    GIVE ME REASONS IF ANY SO THAT I COME TO KNOW WEATHER THERE IS ANY MISTAKE BY ME OR NOT IN UNDERSTANDING THE PLAN?
    ……..ANY READER CAN ALSO REPLY IF U KNOW ANY ISSUE……..

    Reply
    • Dharmil-Please first clean up your mind about confusing statements you made. Bonus Rs.42 or LA Rs.42? I hope you are an agent. Please understand how LA will be declared and what are current LIC LA trends. Then you will come to know about what I predicted above. Can do so please so that we can discuss further on this topic 🙂

      Reply
  12. YERRAPRAGADA SKV PRASAD says
    August 21, 2014 at 6:03 PM

    THE ABOVE REVEALED OPINIONS ARE REVEALED BY MOST EXPERTS OF DIFFERENT INVESTORS. ONE POINT SHOULD REMEMBER. THE OPINIONS IN THIS COLUMN WILL NOT REACH A COMMON MAN. ALL ARE CORRECT. MAX SA 2 LAKHS MAY NOT SUFFICIENT FOR ANY FAMILY. AT THE SAME TIME THIS SEGMENT OF PEOPLE CANNOT EFORD MORE THAN THIS…
    ONE IMPORTANT THING IS …….
    LIFE IS MORE IMPORTANT THAN ANY THING. BIG PEOPLE PLAN WELL FOR FUTURE. SMALL PEOPLE DEPEND ON SOMEBODY”S ADVICE. TWO LAKHS ARE NOT A BIG AMOUNT AND AT THE SAME TIME IT IS ALSO NOT A SMALL AMOUNT FOR SOME PEOPLE. THEY PAY AS MUCH THEY CAN…. LIC GIVES AS MUCH THEY CAN…
    RETURNS CALCULATION ON INVESTMENT MAY BE ONE WAY….. BUT THERE IS ANOTHER CONSIDERATION WHICH IS FINANCIAL NEED OF DISTURBED FAMILIES.
    IN SO MANY DEATH OCCASIONS….. SO MANY PEOPLE WITH KIND HEART GIVE CONDOLENCES TO MAKE DRY OF THE EYES OF SAID FAMILY… THEY CANNOT GO BEYOND THIS WHY? THEY ARE ARE LIMITED TO THAT EXTENT ONLY… SIMILARLY SOME GOVT. FIRMS ALSO…ARGUMENTS ARE NOT THE CREDITERIA IN ALL OCCASIONS….MONEY ALSO…
    BUT HELPING HAND (PREFERBLY FIANCIALLY) IS NEED OF HOUR… THAT IS BEING DOING BY LIC..
    WHO CAN VALUE THIS?
    WHO CAN VALUE THE RETURNS?
    THE REAL VALUE CAN BE CALCULATED BY THE MEMBER OF THE EFFECTED FAMILY NOT YOU OR ME OR SOME OTHER….
    *YSKV PRASAD, RAJAHMUNDRY AP.

    Sir the above comment is given by the person, i think it is good. But you are saying that it not sufficient for the family member of any family. Than how much Sum Assured should be given by the LIC as a upper limit.It should be 15 lakh as limit and my question is that, for Ex. the lic has given the limit of 15 lakhs as sum assured ,how much will be the permium for that.so an common man who is earning 10,000 pm can afforedable to pay the permium which is high for him.

    Pls. relply of this

    Reply
    • Balasubramanyan-First understand the calculation of how one must arrive at INSURANCE need (but not investment). Then it will be better to discuss. I hope you are an agent, so let me know you much a person who is earning Rs.10,000 per month, liability of around Rs.3,00,000 and he have a kid whose education cost is Rs.5,00,000 (current value and is away from 10 years from today) must have INSURANCE coverage? Please let me know your understanding of INSURANCE.

      Reply
  13. Hello Basu Sir,

    Thanks for such a nice website you have developed, I learned many new things from this platform.

    I am a Software Engineer earning 8 Lacs P.A age 25 year Not Married. As of now i have invested in FD around 5 Lacs. I was not having any guidance so blindly invested in FD’s and RD’s.

    Now after going through your blog my way of thinking got changed. Could you please guide me where to invest. As per my understanding after reviewing your blog i have chosen two options for tax savings and future investment.

    Need to invest 1 lac Rs.
    Option 1 – > Taking LIC Policies 50k and 50k in PPF
    Option 2 – > PPF 90K and Term insurance of 1 Cr.

    Could you please guide me what shall i do as of now i don’t have any insurance cover. Please let me know if you have any other option.

    Reply
    • Vipul-None of them will be best. Because over investing in any product is more dangerous than investing in wrong product. So buy term insurance, invest in PPF (for goals of 15 years away and that too around small % like 15-20% of your portfolio), EPF, PPF and Term Insurance are enough I think. But if you still feel short fall then for any short term goals select tax saving FDs and for long term goals select ELSS. Remember ELSS have less lock in (3 Years) but this product being equity oriented, you need to consider this investment only for goals of around 10+ years.

      Reply
  14. GOOD policY

    Reply
  15. Any new life insurances please contact above the number

    Reply
  16. LIC’s Jeevan Rakshak Plan is the best available endowment plan available across Insurance Market. It provides risk cum saving to the lower strata of society. This is affordable as premiums are as low as Rs.250 pm for SA 1 LAKH.
    As against the over all payment of approx 1.4 lakh one gets Rs.2.8 lakh plus Income tax rebate and life risk . Wonderful Plan. Above all this plan is stand alone and will not be clubbed with other insurance coverage while calculating the risk. Apart from this, plan is a non medical scheme and easy to take.
    Financial planner you need to study things well before advising to the masses. This Policy is A must for every household.

    Reply
    • Mr.Malaykumar well done the financial planners need really to study in depth plans before they express some comments.
      This plan is really good for those from low income group.

      Reply
      • Shriniwas-May I know how much income you consider as low income group (considering current inflation and style of life of a family who stay in village but not city)?

        Reply
        • Basa – Mr Malay had commented on my blog post too. He posted the same comment yesterday night.

          Here is my reply.

          “Mr Malay – Appreciate your convincing skills. Let us consider an example of a typical lower income family’s financial situation. Husband will be a sole bread winner with an income of say Rs10,000 pm. His spouse and kid(s) may be dependent on him for all their financial needs. Unfortunately if that breadwinner passes away then do you think this Rs2 Lakhs ( max Sum assured offered under jevan rakshak) is sufficient enough for the family? You have highlighted about ‘risk coverage’in your comment. Do you think is this THE PLAN for risk coverage? Don’t you think LIc’s Term plans (or any other comapanies’) are better options to cover the life risk. For a premium of Rs,7500 the life assured may get a life cover of around Rs70 Lakhs under LIC e-term plan. You have also highlighted about “savings” in your comment. Do you think insurance is for savings or risk coverage. If it is for savings then there are better investment options than this plan. These options can generate higher returns (inflation/tax adjusted) compared to this plan. Don’t you think that a Term plan is a must for every breadwinner in a household? First, study client requirements and then study/identify financial products. Cheers!”

          http://www.onlinefinancialplanner.in

          Reply
          • Sreekanth-Thanks for sharing. If possible you can provide the link of where me and Mr Malay have wonderful discussion on the same topic in Facebook 🙂 After lengthy discussion I am unable to find his reply again…

            Reply
          • Dear friends, I do not know how many of you have moved out in the rural areas of Bihar,Jharkhand,Orissa and Uttar pradesh to sell an Insurance Policy. You also must not be knowing there are many fraud chit fund type companies cheating people in the name of saving in those places where even state or central government administration are unable to make their presence. But our fellow Indian brethren live at those deprived places and the Agents of LIC -rather I’ll call Angels- are able to guide them for Insurance Policy. It was a joke for me to see your illustration of a family having an income of Rs.10000/- pm. People at those places have ample of food grains to feed themselves but they do not have cash to spend,what to talk of Insurance Premium.
            Another aspect,psychology of the people. The first question the people of Rural India ask to an Insurance Agent or any Agent doing financial services-“Kitna milega?”(How much shall I get?) If the agent answers ‘nothing’; his deal immediately gets vanished. If agents scribes death benefits people ask him to get lost.
            All the theories are applicable to those who understand financial planning and go for it. Agents know the importance Term Assurance but it can not be forced on anyone.
            As far as the question of Rs.200000/- being sufficient or not,it depends on various factors.
            I have a live example where son of a deceased insured person started a cycle repairing shop with the help of Insurance money of Rs.50000/- .
            We can not judge what is sufficient for whom sitting here on blog.
            I have 22 years of experience in the Life Insurance sector and eager to share with all of you. I do not want to make any blog a battlefield as one of the friend termed the ‘reply’ as befitting. We all must work towards the welfare of the country and the citizens of India.

            Reply
            • Malay-For your information I born and grown up in a town (North Karnataka) which is similar to places you mentioned above. So if I am writing something here means I fully understand the importance of INSURANCE to such people. “Kitana Milega?” It involves two expectations. One is how much he get from that particular product and second how much agent will share. So for first question you must first educate about the importance of INSURANCE (but not about investment) and for second question-It is creation of agents fraternity. So I can’t say 🙂
              You are being appointed to guide the insurance buyer. So it is your responsibility to guide them about the importance of insurance (forget about a big term called Financial Planning). If you are unable to do that then it is your fault but not of opposite person. Reason is you get paid for that but not to sell a easy product which suites to YOU.
              I respect your experience but at the same time can you share me the year when the example of cycle shop happened? Even if we consider that to be currently. Then whether the son will immediately start earning from that shop? Till his business grown up who will feed them?
              By your own experience can you elaborate more about what is INSURANCE? How you used to calculate one’s insurance need? What are the benefits of term insurance? If your earnings from Term Insurance as well as endowment plans of above launched plan are almost same then why agents fraternity staying away from selling term insurance??
              Please do answer to the questions I raised to discuss further 🙂

              Reply
              • Dear Basav
                If IRDA permits all sorts of Insurance Products to be marketed one can not force Term assurance to be the only Insurance option.
                As far as academics of Insurance you want to learn from me,better you try for Fellowship from III,Mumbai .
                I am so far Associate of III,Mumbai and need not display my knowledge of definitions of Insurance and economic values of an individual.
                I still feel such products(Jeevan Rakshak) are essential for people and are relevant.
                Term Assurance are also good one and I am not against them but I am of the view that with only Term Assurance no company will survive in the market like India.
                Best wishes.

                Reply
                • Malay-I respect your knowledge. But for your information I think you know the faith of old ULIPs or recently banned highest NAV plans. It is wrong to say that IRDA permit to sell means we have to sell everything. I am not claiming an expert. Because learning is continues whether you do CFP or the qualification you are claiming to be best for knowing (III, Mumbai). So I am knowledge seeker from all way of my life whether he is a normal individual, CFP, insurance expert or the so called fellowship. So you are always welcome to share your right knowledge 🙂
                  Do you have valid points to claim that such products are very much essential and relevant? Now I found interesting knowledge sharing from you that the reason for not selling term insurance from an agent is that his insurance company will not survive in the market like India. Great point to justify. So I need to accept that when you are selling insurance product your only concern is about survival of insurance company but not insured person. Great going !!!

                  Reply
              • DO YOU KNOW EVEN TODAY SO MANY PEOPLE CHOOSE RS. 50000 AND RS. 62500 SUM ASSURED INSURANCE AS PER THEIR NEEDS.

                Reply
                • Aslam-Do you know whether they are buying that much sum assured LIC product concentrating on insurance or investment? I don’t think their concentration is insurance. If you educate them about the importance of INSURANCE then definitely they go for higher end. Problem is those who are able to educate are in the business of selling and buyers are blindly believing. Rest is history of what LIC created since it’s inception 🙂

                  Reply
          • Dear Sir,

            If a head of the family is earning Rs.10,000/- per month, whether he is eligible to take term policy for Rs.75 lakh or 1 crore, no insurance company will give insurace cover for this huge amount, and i want to know that, how much amount he can take term assurance plan.

            pls reply

            Rgds
            madhu

            Reply
            • Madhusudhan-Do you feel it is right for a person to buy term insurance of Rs.1 Cr whose yearly earning is Rs.1,20,000? There is something called HUMAN LIFE VALUE. Based on that insurance companies will issue policies. So ideal cover for the person whose yearly earning is Rs.1,20,000 should be Rs.20 to Rs.25 lakhs. So all insurance companies first judge this then only they provide insurance. This applies to term insurance or traditional plans.
              If one go by your logic then someone whose yearly earning is Rs.1,20,000 may easily opted for Rs.50 lakh to Rs.1 Cr insurance. Insurance business runs on valuation of insurable person but not on your feelings.

              Reply
    • Malay-Wow…you are claiming it as if the eighth wonder of world. Please let me know if one is investing in any product for a term of 20 years then how much return this policy will provide? Is it at least equals to PPF returns?? Regarding insurance, even LIC itself started to provide online cheap insurance. Then why should one buy low yielding low insurance product? Do know the minimum rural area family income per year? For how long a family can sustain with this claim amount if insured die? Do you feel one can look at a insurance product which offers no medical? Infact the insured person will be at risk if any insurance company offering risk without proper analyzing. So many questions need to be answered. So first answer these questions then I will discuss my views 🙂

      Reply
      • Dear Basavraj, if you are so negative about LIC then why you are agent of the LIC..An agent’s work is to guide the prospect about all kind of insurance and then it’s upto the prospect to choose a product according to his earning capacities. After reading your posts one becomes very negative about the LIC..and surprisingly you don’t talk about private insurance companies..till date LIC is the most trusted company in India..people rely on..so i think all the discussions here are worthless.

        Reply
  17. this plan 827 is very nice but agent commission is not nice

    Reply
    • Raju-Here discussion is restricted to buyers but not to how much agents earn.

      Reply
    • What is return we get for age 32 years for 10 years

      Reply
        • approx 5% is minimum as it Guaranteed Maturity in-built. You pay much lesser than Sum Assured; you will get Sum Assured + Loyalty Addition.

          Reply
          • Sudip-What is GUARANTEED MATURITY here? Only Sum Assured is guaranteed but not Loyalty Addition. Also investing for 20 years and earning 5% (savings account interest rate) is worth????

            Reply
  18. Basa- on one side you said that this s an expensive plan in comparison to other endowment plan however the commition is lower than the other end plan. and if in every case medical will be carried out then this act will not will not dcrease the expenses. You can duscuss this plan as an insurance to lower class with catelist of saving nd to complete the vision-2020.

    Reply
    • Ahmad-When I said it is expensive than other endowment plans? I am saying that it is equally expensive to other endowment plans. Commission is not a single expense in any endowment plan. Some other expenses which are hidden like development officers commission, fund management and stationary expenses will be there. Whether they do medical or not. It is not my headache. Being insurance buyer my concern is how much insurance I get and whether my family will survive with it or not and being investor how much return I will get in long waiting. In both cases it is failing minimum requirement of low earners too. Then how can we say is good plan?

      Reply
    • Development officer ko kitna credit h

      Reply
      • I Heard
        15+ Years – >60%
        10-14 Years->(40-45)%

        🙁

        Reply
        • Policy Term 1st Year 2nd & 3rd Year Subsequent Years

          10 to 14 years 15% 5.5% 3.75%

          15 years & above 18.75% 5.5% 3.75%

          Bonus Commission: 40% of 1st year commission.

          Brokers:

          Policy Term 1st Year 2nd & 3rd Year Subsequent Years

          10 to 14 years 16% 5% 3.75%

          15 years & above 19.75% 5% 3.75%

          Bonus Commission: No bonus commission is payable to brokers.

          b) Development Officer’s Credit:

          Policy Term Credit (as a % of the first year premium net of taxes)

          10 to 14 years 30%

          15 years & above 60%

          Reply
        • Dutta-Good then it is dangerous product and most expensive product for any investor 🙂

          Reply
          • THE ABOVE REVEALED OPINIONS ARE REVEALED BY MOST EXPERTS OF DIFFERENT INVESTORS. ONE POINT SHOULD REMEMBER. THE OPINIONS IN THIS COLUMN WILL NOT REACH A COMMON MAN. ALL ARE CORRECT. MAX SA 2 LAKHS MAY NOT SUFFICIENT FOR ANY FAMILY. AT THE SAME TIME THIS SEGMENT OF PEOPLE CANNOT EFORD MORE THAN THIS…
            ONE IMPORTANT THING IS …….
            LIFE IS MORE IMPORTANT THAN ANY THING. BIG PEOPLE PLAN WELL FOR FUTURE. SMALL PEOPLE DEPEND ON SOMEBODY”S ADVICE. TWO LAKHS ARE NOT A BIG AMOUNT AND AT THE SAME TIME IT IS ALSO NOT A SMALL AMOUNT FOR SOME PEOPLE. THEY PAY AS MUCH THEY CAN…. LIC GIVES AS MUCH THEY CAN…
            RETURNS CALCULATION ON INVESTMENT MAY BE ONE WAY….. BUT THERE IS ANOTHER CONSIDERATION WHICH IS FINANCIAL NEED OF DISTURBED FAMILIES.
            IN SO MANY DEATH OCCASIONS….. SO MANY PEOPLE WITH KIND HEART GIVE CONDOLENCES TO MAKE DRY OF THE EYES OF SAID FAMILY… THEY CANNOT GO BEYOND THIS WHY? THEY ARE ARE LIMITED TO THAT EXTENT ONLY… SIMILARLY SOME GOVT. FIRMS ALSO…ARGUMENTS ARE NOT THE CREDITERIA IN ALL OCCASIONS….MONEY ALSO…
            BUT HELPING HAND (PREFERBLY FIANCIALLY) IS NEED OF HOUR… THAT IS BEING DOING BY LIC..
            WHO CAN VALUE THIS?
            WHO CAN VALUE THE RETURNS?
            THE REAL VALUE CAN BE CALCULATED BY THE MEMBER OF THE EFFECTED FAMILY NOT YOU OR ME OR SOME OTHER….
            *YSKV PRASAD, RAJAHMUNDRY AP.

            Reply
        • THE ABOVE REVEALED OPINIONS ARE REVEALED BY MOST EXPERTS OF DIFFERENT INVESTMENTS. ONE POINT SHOULD REMEMBER. THE OPINIONS IN THIS COLUMN WILL NOT REACH A COMMON MAN. ALL ARE CORRECT. MAX SA 2 LAKHS ARE NOT SUFFICIENT FOR ANY FAMILY. AT THE SAME SOME SEGMENT OF PEOPLE CANNOT EFFORD MORE THAN THIS…
          ONE IMPORTANT THING IS LIFE IS MORE IMPORTANT THAN ANY THING. BIG PEOPLE PLAN WELL FOR FUTURE. SMALL PEOPLE DEPEND ON SOMEBODY”S ADVICE. 2 LAKHS ARE NOT A BIG AMOUNT AND AT THE SAME TIME IT IS ALSO NOT A SMALL AMOUNT FOR SOME PEOPLE. THEY PAY AS MUCH THEY CAN…. LIC GIVES AS MUCH THEY CAN…RETURNS CALCULATION ON INVESTMENT MAY BE ONE WAY….. BUT THERE IS ANOTHER CONSIDERATION WHICH IS FINANCIAL NEED OF DISTURBED FAMILIES.
          IN SO MANY DEATH OCCASION SO MANY MANKIND PEOPLE GIVE CONDOLENCES UPTO MAKE DRY OF THE SAID FAMILY… THEY CANNOT GO FURTHER THAN THAT WHY? THEY ARE ARE LIMITED TO THAT EXTENT ONLY… SIMILARLY SOME GOVT. FIRMS ALSO…ARGUMENTS ARE NOT THE CREDITERIA IN ALL OCCASIONS….MONEY ALSO…
          BUT HELPING HAND (PREFERBLY FIANCIALLY) IS NEED OF HOUR… THAT IS BEING DOING BY LIC..
          WHO CAN VALUE THIS?
          WHO CAN VALUE THE RETURNS?
          THE REAL VALUE CAN BE CALCULATED BY THE MEMBER OF THE EFFECTED FAMILY NOT YOU OR ME OR SOME OTHER….
          *YSKV PRASAD, RAJAHMUNDRY AP.

          Reply
          • Prasad-I value and respect your opinion. But when your describing more about insurance need of a family then why can’t you suggest common man a term plan of more than Rs.2 lakh (which he can easily afford) and rest suggest him to put in Bank FDs or PPF kind of instruments???

            Reply
            • myself being agent , even i am i dilemma of endowment or term plans selling. No doubt i consider term plan as far as family’s financial condition is concerned , but when i try to convince my client to invest in RDs or Bank FD where he can get better returns , he gets convinced but in future out of 100 , 95-98 discontinue those a/cs.
              Lics plans are low returned no doubt , but an agent goes behind client and tries to serve till maturity , in the end client gets forced which gives him small but helpful returns with isnurance.
              i wish i could get reply from you to my email ID as well.

              Reply
              • Sunil-Do you feel for long 20 years agent will be in same profession? So what will be faith of those who bought polices from those agents who left industry within 2-3 years?

                Reply
                • Sir , no doubt many agents have left in middle , but still there is great percentage of agents who want to give them services .Perhaps due to this concern LIC is giving opportuiniy to other agents to serve clients ,whose agents have left in middle and accordingly they get commission instead of those (agents who left).
                  For this client’s faith will continue. It’s all about agent, whoever gives service will continue to remain faithful till end .

                  Reply
                  • Sunil-May I know that “MANY AGENTS” %? It is huge…even agents who survived and continued in this business also look more for business rather than service. It is plain truth I am saying directly. At the same time I am not claiming that all agents are bad. But majority is what I am saying.

                    Reply
                    • Sir , i don’t know percentage , but if i am one of those , then what should i suggest to my clients ? I think i should continue to suggest what is best for client be it term plan (if he understands) or endowment plan for i am and will continue to give him service which my client deserves. and in both cases my client will surely benefit , his life will safeguarded (if he opts for term plan) , will surely continue to save (if he opts endowment).
                      i am posting this by heart and confident for my advise to my client won’t hurt.Sir i will appreciate you if you could suggest more.

                    • Sunil-Concentrate on CLIENT FIRST. Business will time being slow down but in long run you will be leader.

          • Mr X invested in one plan rs 50K Per annum having Sum assued 5 Lacs
            Mr Y invested 40 K in PPF & buyed term plan have Sum assued 75 Lacs with remaining 10K

            both of them surived till 15 Years
            X will receive 12 to 12.5 lacs this is assured value.
            Y will receive 12 lacs or more guarented.

            Uncertainty happen in both of them.
            X will receive 5 Lacs
            Y will receive 75 Lacs

            Who is better prasad you tell me?

            Basav how is this? if you have any suugestion to me pls mail
            [email protected]

            Prasad I am creating awareness about term plan.
            Pls feel free to calrify

            Reply
  19. LIC has come out with this plan to go for mass insurance cover for all insurable persons and to fulfill the Vision 2020 of LIC of India. There are many persons who cant afford higher premiums compared to Insurance cover and hence this is best suited to persons having low income and wants to have insurance coverage at low cost. Sum Assured is guaranteed in this plan which is more than 1.30 times of total premium paid. This seems to be good and attractive for low income persons.

    Reply
    • Ajay-How about insuring all individual (major earning person of a family) with Rs.5,00,000 sum assured by LIC? Will it not be called mass insurance and vision 2020? Can you elaborate more about the income of a low income persons? Is it yearly Rs.1,00,000 or what?

      Reply
  20. Yes Sir,I am agree with you that lic’s jeevan rakshak plan’s maximum sum assured limit is very low and it may not be sufficient for survivors but in a country where government have run projects like MNREGA there such plans surely have some relevance.

    Reply
    • Dipankar-Whether Govt runs then let them. But we need to check it whether the plan is suitable for ME or not.

      Reply
      • Dear basu…. there are other plan like jeevan anand nd other term insurance which have no upper limit. Need nd paying capacity of every individual are not same. So each plan is suitable for every one… how it can be. One more thing this plan is without medical so upper limit is fixed.

        Reply
        • Ahmed-Please let me know that how we can discuss this plan? Insurance or Investment? If in both the cases it fails to meet lower of lower class family then do you still feel it is good or best?? Non medical alone is not a big point to buy this plan. It it LICs responsibility whether to issue the risk by medical or non medical. Claiming this as a biggest feature of plan is not worth. In fact I suggest each insurance product must be medically tested. Because insurance company must know the exact facts about the person of whom they are taking risk.

          Reply
          • Can we give no of policy one person…….????

            Premium is very low almost 50% less compared other andowment plan……one can see this plan as term plan with maturity

            Reply
            • Deepakgajra-Maximum limit under this plan set as Rs.2,00,000. So how many can you give? If premium is low so what?? Will it provide me higher return than any other endowment plans? Term Plan to this???? Please educate yourself first.

              Reply
  21. Sir , which health insurance policy u recommend for me ?
    How munch cover I have to take ?

    Reply
    • Vikas-It depends on your requirement, your family health history and in which city you reside. So if you already selected the company and product then better they will guide you about how much you need.

      Reply
  22. Sir, can u pls Comments on oriental medi claim policy ? ItS feature and benefit?
    I have to take cash less policy , pls share ur thought on this . Thanks

    Reply
    • Vikas-Regarding features and benefit visit their site and view it. If it suites then go ahead.

      Reply
  23. I don’t think this is an Good Insurance Product except Rural Area as Insurance of Just Rs. 2 Lacs is nothing todays and if it is for Investments than Banking/Debt MF Products are better as they give better return & also Accidental Insurance even for higher than 2 Lacs. THIS IS MY OPENION AS PER MY KNOWLADGE & EXPERIANCE OTHERS MAY DIFFER !!!

    Reply
    • Amit-The cover of Rs.2,00,000 is not suffice to rural family in today’s inflated life expenses.

      Reply
  24. Sir,
    You are dalal of multinational, and if you have half information please do not comments, the premium for above product is just 7000/ for 2lacs cover and the guaranteed return of 2lacs. Can you tell me a common man product better than this? If he comes to you for advice you charged him in lacs . keep your services for HNI , who can afford you people and they have lot off money to loose.

    Reply
    • SA- 2LACS, PREMIUM -7000/- P.A. AND RETURN IS 2LACS GUARANTEED AND LOYALTY.

      Reply
    • Pankajj-Thanks for your wonderful knowledge sharing 🙂 Let us first not discuss whom we are targeting. Instead can you share your experience like how much return one can expect from this plan? I am asking return because we need to think as if investor but not insurance buyer. Reason is maximum limit of insurance in this plan is just Rs.2,00,000. Also no need to go to level of HNIs or any multinational company level. We restrict our discussion to this plan with bank FDs or PPF. What you say? This makes sense for understanding to all investors irrespective of their size.

      Reply
    • Basa. Glad to know that you are charging fees in lakhs.
      Jokes apart, you have been writing wonderful articles for the past few years, that shows you are providing selfless service. Keep doing good work.

      Reply
      • Sreekanth-Thanks that he found such high eligibility in me that I can charge clients in lakhs. He actually motivated me 🙂

        Reply
  25. Traditional plans (endowment or money-back) generate returns of around 5% in most of the cases. If you are ok with that kind of returns then mix insurance with investment. Life insurance is a must. But choose right cover and plan.

    Sreekanth (www.onlinefinancialplanner.in)

    Reply
    • BTW Basa, i liked the post title. Cheers!

      Reply
      • Sreekanth-You are my guru and such inspirational words from you will always boost me 🙂

        Reply
        • Thank you Basa. You are the inspiration for starting my blog. Let’s keep learning and share the knowledge.

          Reply
      • Sir, I need to buy a health insurance policy. I am 41 yrs old and I have a wife aged 36 and two children aged 10 and 12 yrs old. We are all with good health.Can you suggest me the best plan

        Reply
        • Ramagowni-You can opt from companies like Star, Apollo, MaxBupa, National Insurance or United.

          Reply
          • Ramagowni- Before going to buy this plan pls take the advises from proper agent. I will suggest to bus floater plan for your family. understand first then buy

            Reply

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