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LIC's New Endowment Plan (Plan 714) is a participating, non-linked, individual savings life insurance plan from Life Insurance Corporation of India. You pay premiums regularly for a policy term of 12 to 35 years, and the plan gives you life cover throughout that term and a lump sum when it ends. If you survive the term, you receive the Basic Sum Assured plus all vested Simple Reversionary Bonuses and any Final Additional Bonus. If you die during the term, your nominee gets the higher of the Basic Sum Assured or 7 times the annualised premium, plus the vested bonuses and any Final Additional Bonus, and never less than 105% of the premiums paid. The plan shares in LIC's profits, so bonuses are declared every year based on LIC's experience, and once declared the Simple Reversionary Bonuses become part of the guaranteed benefits. Entry age is 8 to 50 years, the policy must mature by age 75, and the minimum Basic Sum Assured is ₹2 lakh with no upper limit. You can pay yearly, half-yearly, quarterly or monthly, take the maturity or death benefit in instalments, and add up to five optional riders. The plan can be bought offline only, through LIC agents, corporate agents, brokers and insurance marketing firms.
Participating endowment plan that pays the Basic Sum Assured plus bonuses at maturity, with life cover throughout the 12 to 35 year term.
LIC's New Endowment Plan suits someone who wants disciplined long-term saving with a modest life cover and is comfortable with the slow, bonus-linked returns of a traditional plan. In LIC's own illustration (age 30, ₹2 lakh Basic Sum Assured, 35-year term), the yearly premium is ₹6,213 and total premiums come to ₹2.17 lakh. At the lower assumed bonus rate, the maturity amount is about ₹2.8 lakh, and at the higher rate it is ₹4.91 lakh. Our estimate of the return from those two figures is about 1.4% to 4.2% a year before tax if you survive to maturity, and the higher figure depends on bonuses that are not guaranteed. That is modest, so treat the plan as protection with forced saving rather than as an investment. The cover is also small for the premium: ₹2 lakh of cover for ₹6,213 a year, so it is not a substitute for a term plan. Early exit is costly, since nothing is paid back if you stop in the first year and the guaranteed surrender value starts at only 30% of premiums in the second year. Choose it only if you can pay premiums for the full term and will not need the money early.
LIC
Key Insights
Founded
1956
LIC was established 70 years ago and has built strong credibility over time, backed by its long-standing presence in the market.
Claims Experience
98.5% CSR, calculated as a 3-year average
LIC settles 98.5% of all claims it receives, demonstrating strong credibility.
Contact Details
022-68276827
Headquarters: Jeevan Bima Marg, Nariman Point, P.O. Box No. 19953, Mumbai, Maharashtra 400021, India
If you survive the policy term and the policy is in force, you get the Basic Sum Assured plus all vested Simple Reversionary Bonuses and any Final Additional Bonus.
Bonuses depend on LIC's experience. Once declared, Simple Reversionary Bonuses form part of the guaranteed benefits.
If the life assured dies during the policy term with the policy in force, the nominee gets the higher of the Basic Sum Assured or 7 times the annualised premium, plus vested bonuses and any Final Additional Bonus, and never less than 105% of the total premiums paid.
Annualised premium excludes taxes, rider premiums, extra premiums and loadings for modal premiums.
The plan shares in LIC's profits. Simple Reversionary Bonuses are declared at the end of each financial year while the policy is in force, and a Final Additional Bonus may be added when the policy ends in death or maturity.
Future bonuses are not guaranteed. LIC's illustration for ₹2 lakh over 35 years shows ₹2,300 a year at a 4% assumed rate and ₹5,800 a year at 8%.
You choose a policy term of 12 to 35 years, and the policy must mature by age 75. Premiums are paid regularly over the term.
Risk cover starts immediately on acceptance of the risk.
Entry age is 8 years (completed) to 50 years (nearer birthday). The minimum age at maturity is 20 years (completed) and the maximum is 75 years (nearer birthday).
A policy on a minor's life vests in the child on the policy anniversary at or after age 18.
If an accident causes death, the Accident Benefit Sum Assured is paid as a lump sum. For a disability caused by an accident (within 180 days), it is paid in equal monthly instalments over 10 years, and future premiums for that amount are waived.
Choose this or the Accident Benefit Rider, not both. It can be added within the policy term before age 65 if at least 5 years of premium paying term remain, and cover runs to the end of the term or age 70, whichever is earlier.
Pays the Accident Benefit Sum Assured as a lump sum if death is caused by an accident.
Conditions or treatments that the policy clearly says it will not cover.
Insurer
LIC plans and claim process
It is a participating, non-linked, individual savings life insurance plan from LIC (Plan 714). You pay premiums over a policy term of 12 to 35 years, get life cover during the term, and receive the Basic Sum Assured plus bonuses if you survive to maturity.
If you survive the policy term and the policy is in force, you get the Basic Sum Assured plus all vested Simple Reversionary Bonuses and any Final Additional Bonus. In LIC's illustration for ₹2 lakh over 35 years (age 30), the maturity amount is ₹2,80,500 at a 4% assumed rate and ₹4,91,000 at 8%, and the bonus part is not guaranteed.
The nominee receives the higher of the Basic Sum Assured or 7 times the annualised premium, plus vested Simple Reversionary Bonuses and any Final Additional Bonus, and never less than 105% of the total premiums paid up to the date of death. The policy must be in force.
Disclaimer: Premium amounts are indicative and may vary based on age, health, and plan selected. Claim settlement ratios are from IRDAI Annual Reports. Finzony is not an insurance broker or agent. Verify all details on the official LIC website before purchasing.
Official Website
licindia.in
Visit the official LIC website for plan brochures, premium quotes and policy services.
The aforementioned ratios have been averaged over three years (FY24-FY26)
Same eligibility as the other accident rider: choose one of the two. The rider sum assured can be up to 3 times the Basic Sum Assured.
Adds extra term cover: the Term Rider Sum Assured on Death is paid if the life assured dies during the policy term.
Available at policy inception only. The rider benefit cannot exceed the Basic Sum Assured.
If the proposer dies, the base plan premiums falling due after the death are waived until the rider term ends, which suits policies bought on a child's life.
Needs at least five years of premium paying term left, and the rider term plus the proposer's age cannot exceed 70 years.
Pays the Critical Illness Sum Assured on diagnosis of a covered illness. Option 1 covers 15 major critical illnesses. Option 2 covers 40, and for 7 of them it adds monthly payouts of 1% of the sum assured for 36 months as Assisted Living Benefit.
Available at policy inception only. Rider term is up to 25 years, and cover ends at age 75 or the policy term, whichever is earlier.
LIC declares Simple Reversionary Bonuses at the end of each financial year based on its experience, and they are added while the policy is in force. Once declared, they form part of the guaranteed benefits. A Final Additional Bonus may be declared in the year the policy ends in death or maturity, and it is not paid on paid-up policies. If premiums are not paid, the policy stops sharing in future profits.
Entry age is 8 to 50 years. The policy term is 12 to 35 years, the minimum age at maturity is 20, and the maximum age at maturity is 75.
The minimum Basic Sum Assured is ₹2 lakh. It goes up in steps of ₹5,000 until ₹4.5 lakh, ₹50,000 until ₹9 lakh and ₹1 lakh above that. There is no upper limit.
LIC's sample for a ₹2 lakh Basic Sum Assured at age 30, yearly premium, before taxes, shows ₹14,592 for a 15-year term, ₹8,497 for 25 years and ₹6,213 for 35 years. Paying yearly gets a 2% rebate on the tabular premium, and a higher Basic Sum Assured gets a rebate from ₹5 lakh. The exact premium depends on your age, sum assured and policy term.
If you stop before one full year of premiums is paid, all benefits end after the grace period and nothing is paid back. After one full year, the policy becomes paid-up with a reduced sum assured, and vested bonuses stay attached, but it no longer shares in future profits. A discontinued policy can be revived within 5 consecutive years of the first unpaid premium and before maturity.
You can surrender after the first policy year, but a guaranteed surrender value applies only after two full years of premiums, at 30% of premiums paid in the second year, 35% in the third and 50% from the fourth to the seventh year, rising to as high as 90% near the end of the term. LIC can also pay a higher special surrender value. A loan is available after the first policy year, up to 75% of the surrender value on an in-force policy once two full years of premiums are paid (50% before that), at an interest rate that LIC resets every year.
Yes. You can choose instalments over 5, 10 or 15 years instead of a lump sum, for the full amount or part of it, paid yearly, half-yearly, quarterly or monthly. The minimum instalment is ₹5,000 monthly, ₹15,000 quarterly, ₹25,000 half-yearly or ₹50,000 yearly. The maturity option must be chosen at least 3 months before the due date.
Yes. Five optional riders are available for an extra premium: the Accidental Death and Disability Benefit Rider, the Accident Benefit Rider, the New Term Assurance Rider, the Premium Waiver Benefit Rider and the Critical Illness Health Rider. You can choose either the first or the second rider, not both. All riders other than the Critical Illness Health Rider together cannot cost more than 30% of the base premium, and the Critical Illness Health Rider cannot cost more than 100%.
No. The brochure says the plan can be purchased offline through licensed agents, corporate agents, brokers and insurance marketing firms.
You get 30 days of grace for yearly, half-yearly or quarterly premiums and 15 days for monthly, and the policy stays in force during that time. The free look period is 30 days from receiving the policy document, and you get your premium back less a proportionate risk premium, medical examination costs and stamp duty.