As mentioned
earlier in the life insurance
industry, apart from LIC India Several private companies are also
involved in selling life policies to general public living in
different corners of our country. The policies of private players have already
been given in the previous chapter. The policies of LIC of India have great
have been grouped under the following nine major heads.
1) Whole life policies. 2) Endowment policies 3) Children’s policies 4) Joint life policy 5) women’s policy 6) Term policies 7) Special policies 8) Group insurance policies 9) Pension policies.
(1) whole life policies:
The risk is covered for the entire of the policy holder which
is why they are known as whole life policies. They policy amount and the bonus
are payable only to the nominee or the beneficiary upon the death of the policy
holder. The policy holder is not entitled to any money during his or her own
life time i.e., there is no survival benefit. This represents a serious drawback in the case of whole life
policies for they go on covering a policy holder’s life even after his life has no
further economic value for others. One
the other hand a policy holder would
probably require the money for himself and his spouse during retired life but this would not be possible
since the sum assured is payable only
when the policy holder dies. In his
sense whole life policy are fairly
rigid and suitable only in a few
very specific cases. The important whole
life policies offered by LIC of India
are as follows:
1) Single
premium whole life plan No.8: Under this
policy the total amount of premium payable is paid in one
lumpsum by the assured. The time element is the predominating feature and
protection element is substantially less
than the face value of the policy .
The policy is not so
popular but is purchased for investment
purpose. It suits those persons who get windfall income like lotteries
etc. and who can afford such single payment. The minimum sum assured is Rs.
20,000 and there is no limit maximum sum
assured.
(2) Convertible whole life plan No-27:
This policy is suitable to young man who is on the thresh
hold of his career and has prospects of
increase in income after some times. The object of this is to provide maximum protection at
minimum cost. It is a whole life without profit plan, premiums payable up to
age of 70 yearsof the assured. The
premium charged is that of whole life without profits and therefore sufficiently low. This risk is
however covered for the full sum assured. After 5 years, the life assured can
convert this policy into an endowment with or without profits
choosing that term without having to go on in for a medical examination In case
the conversion option is not exercised at the end of 5 years the policy continues as a whole life plan
without profits with the premium
payments ceasing at the age of 70. The minimum sum assured is Rs. 20 000, and
the maximum age at the entry is 45 years.
3) Limited payment whole life plan
No-5: In this policy the life
assured required to pay premium for a fixed period from 5 to 55 years. The life
assured shall have