LIC Plans For 5 Years - Types, Features And More!

Life insurance is a protective shield against life's uncertainties. It is a crucial part of financial planning because it armours you and your loved ones from financial burdens during tough times. However, finding the right insurer and plan is just as important as having insurance itself. You will need to source an insurance provider you can trust and also a plan that fits your unique needs and budget.

This is where the LIC plans for 5 years step in – LIC, or Life Insurance Corporation, is a trusted name in insurance. Their 5-year plans offer a simple yet powerful way to secure your future. With affordable premiums and flexible options, these plans ensure the financial stability of your dear family for the long term. In this article, you will learn more about how this plan can actually benefit you and your family.
 

Why Consider LIC Plan For 5 Years?

Considering the LIC plan for 5 years can be a wise choice for various reasons. These plans come with shorter policy tenure and premium periods and the flexibility to extend the policy period later if needed. They can help cover crucial obligations for you and your family. When you have important financial commitments, like your child's education, marriage, buying a home or car, etc. LIC's 5-year insurance plans can be a reliable solution. Plans like endowment and money-back policies offer guaranteed returns, making it easier to achieve short-term goals.

Moreover, some debts linger even after you're gone. If you have a substantial loan that may take five years to repay, a 5-year life insurance plan could act as a safety net during that tenure. In the unfortunate event of your passing during this period, the death benefit can relieve your family of financial burdens. Additionally, these policies are often budget-friendly, making them accessible to many. By opting for LIC's 5-year plans, you can secure your family's future without undue stress.
 

Is There Any LIC Plan – 5 Years Double Money Feature?

It is important to know that LIC does not offer any plan that doubles your money in just five years. However, you can select a plan with a savings or investment element, like an endowment or money-back plan, and choose a 5-year policy term.

So, the idea of an LIC plan doubling your money in 5 years is not guaranteed. But, there are LIC policies that can give you better returns when they mature, with the feature of bonuses and investments linked to the market.
 

Best LIC Policy For 5 Years Offered In India 2024

Here are some LIC plans that you buy, with a 5 year policy term –

LIC Saral Jeevan Bima

This plan provides short-term risk coverage. In the unfortunate event of your demise during the coverage period, LIC pays out the sum assured to your family, ensuring they remain financially secure. With this plan, you are ensuring they will not encounter any hardship in the event of your absence.

The specifics of the plan are listed below –

LIC Dhan Sanchay Plan

This plan is crafted to generate a steady income stream after your policy matures. If you were to pass away during the policy period, your assigned nominee would receive the death benefit amount. This plan not only safeguards your future but also ensures the financial well-being of your family in your absence. It is worth noting that this 5-year LIC plan is available only under the Single Premium Enhanced Cover with Level Income Benefit and Single Premium Level Income Benefit options.

Here’s a general overview of the plan’s specifics –

LIC New Jeevan Shanti

This plan is an annuity option offering deferred payments. Meaning, you can choose to start receiving regular income payments after a set period, known as the deferment period. At the time of purchase, you select the income amount you desire. Once the deferment period ends, annuity income begins and continues until your demise. In case of your passing, the annuity payments cease, and the death benefit amount is paid to your family.

The plan specifics are as such –

LIC Jeevan Akshay VII

This plan offers an immediate annuity and can be bought with a single lump-sum payment. You'll start receiving annuity payments right away, either monthly, quarterly, half-yearly, or yearly.

Here are the eligibility criteria for this plan –

LIC Bhagya Lakshmi Plan

This is a protection plan with limited payment terms, ensuring a return of 110% of the total premiums paid upon maturity. The premium payment term is two years shorter than the policy term. In case of your demise during the policy term, the LIC Bhagya Lakshmi Plan provides a death benefit that is equal to the total sum assured amount.

The specifics of the plan are as follows –

Please note that the exact minimum and maximum criteria would depend on the plan option you select. The above is just a general overview of the plans’ specific.
 

Benefits Of LIC 5-Year Policy

Here are the key advantages of having a LIC 5-year policy –

1. Promises Life Protection
   Life is full of dreams and plans for the future, yet it can be unpredictable. Despite our efforts to plan ahead for the next five years, unexpected events can disrupt even the best-laid plans. This is where LIC policies step in, providing a vital safety net through life insurance coverage. In case of your passing during the policy term, your family receives the predetermined sum assured along with accrued bonuses, as per terms and conditions.
    
2. Pays Out A Maturity Benefit
   If you live through the entire policy duration, certain LIC plans (excluding term insurance) offer a maturity benefit. This benefit typically includes the sum assured chosen by you when purchasing the policy and any bonuses that have been accumulated during your policy term.
    
3. May Also Offer Survival Benefits
   Some LIC plans may offer survival benefits, which are paid at the end of the premium payment term, after you have completed paying the premiums. However, only a few LIC plans provide survival benefits for a 5-year policy term.
    
4. Generates Cash Value
   Certain types of life insurance policies generate a cash value. This cash value starts accumulating when you begin paying the premiums for your life insurance policy. When you face a financial emergency, you can borrow money against this cash value.
    
5. Provides Financial Assistance
   LIC policies often allow you to take loans against the policy's surrender value. This can be helpful if you need immediate access to funds for emergencies or any other financial needs during the 5-year period. Instead of borrowing against assets like your home, gold, etc., you can use your life insurance policy. It is important to note that this option is not available with term insurance policies.
    
6. Comes With Riders And Extra Benefits
   LIC policies offer various additional benefits and riders, such as critical illness cover, accidental death benefit cover, accidental disability rider, etc. These can be added to your base policy to enhance your protection.
    
7. Tax Benefits
   Investing in a LIC plan for 5 years can offer tax advantages. According to current tax regulations, you can claim deductions on the annual premiums that have been paid under Section 80C of the Income Tax Act, 1961. This helps lower your overall tax burden. Additionally, payouts from life insurance policies are also eligible for tax benefits as laid out under Section 10(10D) of the Act.
    

How To Choose The Right LIC Plan For Your 5-Year Goal?

Here's a simple guide to help you choose the right plan –

• Define Your Goal
  The initial step in selecting the best LIC policy for 5 years is to understand your needs and desires. Whether you are saving for a big purchase, financing a significant event, or preparing for the future, identifying your objectives is crucial for picking the most suitable LIC plan.
   
• Evaluate Your Risk Tolerance And Choose Policy Type
  Consider your comfort level with risk to select the type of LIC plan that suits you best. If you prefer stability and guaranteed returns, traditional plans like endowment or money-back policies may be the right choice for you. Since your goal has a specific timeline of five years, look for LIC plans with matching investment durations. Compare the potential returns of different plans to find one that meets your financial goals. Plans, such as endowment or money-back policies, can be perfectly suited to match your specific timeline and goals. Remember, ULIPs have a lock-in period of 5 years and market-linked returns, so they may not be suitable for a 5-year goal.
   
• Decide On The Cover Amount
  It is crucial to figure out how much coverage you need to align with your goal. You can use an online life insurance calculator to determine the right coverage. Just input details like your age, income, occupation, etc., and you will be able to decide the cover amount you need accurately. Alternatively, you can also get in touch with a financial advisor to assist you in carefully assessing your needs and deciding on an appropriate cover amount.
   
• Review Plan Features And Benefits
  Remember, not all LIC plans offer the same features and benefits. Hence, you should take a close look at the details of each policy. Compare various LIC plans available in the market. Consider factors such as maturity benefits, bonus structure, flexibility in premium payments, additional riders or benefits, etc. that meet your needs.
   
• Evaluate Your Budget
  Once you have narrowed down your options, compare the premium quotes of different LIC plans. Even though they may be from the same insurer, premiums can vary. Consider your current financial commitments, income stability, future cash flow expectations, etc., to ensure that the premium of your chosen LIC plan remains manageable over the five-year period. You can use an online comparison tool or seek advice from a financial advisor.
   
• Consider Expert Advice
  If you are unsure which LIC plan suits your 5-year goal, consider seeking advice from a qualified financial advisor or LIC agent. You could also reach out to our experts for personalised guidance. They can assist you based on your financial situation, risk tolerance, and goals, helping you make a well-informed decision.
   
• Review The Final Policy Document
  Before making your final decision, carefully read the policy document. Ensure you understand all the terms and conditions and pay close attention to what is included and what is excluded. Assess details like lock-in periods and conditions under which claims may be denied.
   

How To Purchase A LIC Plan?

Here's how you can purchase a LIC plan –

Step 1: Visit our website: https://www.smcinsurance.com/.

Step 2: Once you are on our page, you will see various insurance product options like car insurance, health insurance, life insurance, etc.

Step 3: Click on ‘Life Insurance’ from the available options.

Step 4: Input your personal details such as date of birth, email address, mobile number, annual income, smoking status, and the age till which you want the policy to be active (policy term). For example, if you want to buy a 5-year policy and you are currently 30 years old, select age 35.

Step 5: Once you meticulously answer all the questions, click on ‘Get Quotes’.

Step 6: Based on the information provided, you will see a selection of plan recommendations tailored to your needs. Be sure to explore the options, especially plans offered by LIC.

Step 7: You can customise the plan by choosing the desired cover amount, premium payment term and frequency, etc.

Step 8: Once you have reviewed the options and are satisfied with your selections, you can proceed to purchase the policy directly through our website.

If you have any questions or need assistance at any stage, feel free to reach out to our team of experts.
 

To Conclude,

An LIC plan for 5 years offers a valuable opportunity to safeguard your future and protect your loved ones. Whether you are aiming to achieve specific financial goals or safeguard against unforeseen circumstances, these plans provide tailored solutions to suit your needs. With their simplicity, flexibility, and reliability, LIC plans let you embark on your journey towards financial stability with confidence.
 

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