Tag Archives: LIC Bima Bachat premium calculator

LIC Bima Bachat: Features, Benefits & Illustration

LIC Bima Bachat: A money-back policy which offers financial security and assurance to the policy holder and his family. Bima Bachat requires the policy holder to pay only one premium. The amount paid for the premium depends on the duration of the policy taken and life insurance is available till the date of maturity.

Benefits of Bima Bachat:

For a term of 9 years: The policy holder will receive 15% of the sum assured at the end of every 3rd and 6th policy year.


For a term 12 years: The policy holder will receive 15% of the sum assured at the end of every 3rd, 6th and 9th policy year.


For a term 15 years: The policy holder will receive15% of the sum assured at the end of every 3rd, 6th, 9th and 12th policy year.

Additional benefits:

If the policy holder outlives the duration of the policy, at the time of maturity, a single premium payment (excluding extra premium) is made along with loyalty additions, if any.

How much insurance do I get?

The policy holder is insured for an amount equal to the sum assured.

What about the installment received already?

The insurance cover is irrespective of the installments received.

Eligibility for the guaranteed surrender value

The guaranteed surrender value is available only after completion of at least one policy year. This value is equal to 90 % of the single premium paid (excluding extra premium).

What other benefits does this insurance cover offer?

Bima Bachat is the only money-back policy that offers a loan facility. The rate of interest for this will be determined from time to time by the corporation. Presently the rate of interest is 9% p.a. payable half-yearly.

It also offers other benefits like the 15 day cooling off period, grace period and revival.

Other conditions or restrictions:

The following are the requirements that one needs to be aware of before applying for this
policy:
· The person applying for the policy should have completed 15 years and should not be older than 66 years.
· The policy will mature when the person is 75 years old.
· There is a choice of three terms to choose from (9, 12 and 15 years) for the policy depending on the age and requirement of the applicant.
· The minimum sum that needs to be assured is Rs 20,000/- and there is no limit on the amount that can be assured.
· It is important to note that the sum assured should be in multiples of Rs 5000/- only.
· The policy requires the holder to pay a single premium.

Premium Payment:

Single Premium

The sample premium rates are as under: –

Age
Annual Premium per 1000 SA
9
12
15
15
716.40
771.35
804.00
20
717.20
771.85
804.40
25
717.55
772.25
804.95
30
718.45
773.35
806.10
35
721.05
775.75
808.55
40
725.80
780.25
812.95
45
734.10
787.60
819.60
50
746.60
797.90
828.95
55
762.65
811.95
841.75
60
784.80
831.30
859.35
65
816.25

What incentives do I get for a higher sum assured?

Let’s take an example of a 30 year old with a Bima Bachat policy for 12 years. If the sum assured is Rs 45,000 then he has to pay a premium of Rs 34800.75. But for a sum assured amount of Rs 50,000 he will have to pay a premium of Rs 36734.13 only, thus getting a 5% rebate in premium.

Refer to the table below for other rebate percentages:

Less than Rs. 50,000 NIL
Rs. 50,000 and Less than Rs.1 lakh 5%
Rs. 1 lakh and Less than Rs.2 lakh 7%
Rs. 2 lakh and above 8%

Illustration of Bima Bachat:

Let us take the example of a policy holder who is 35 years old and takes a policy for the term of 9 years for a sum of Rs 1,00,000/-.He pays a single premium of Rs 67058/-

End of year
Total premiums paid till end of year

Benefit on death during the year

Guaranteed

Variable

Total

Scenario 1

Scenario 2

Scenario 1

Scenario 2

1
to
9

67058

100000

0

0

100000

100000

Survival Benefits :

End of year
Total premiums paid

Benefit payable on survival at the end of specified year

Guaranteed

Variable

Total

Scenario 1

Scenario 2

Scenario 1

Scenario 2

3

67058

15000

0

0

15000

15000

6

67058

15000

0

0

15000

15000

9

67058

67058

0

24300

67058

91358