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LIC Endowment Plan

LIC New Endowment Plan-one of the best policy by LIC India. The LIC New Endowment plan (Plan No: 914) is a must to avail plan considering the many benefits it offers to the customer. It is a non-linked life insurance policy that offers guaranteed returns and bonus. The policy offers a great bandwidth in the choice of the policy term. One can choose the duration of the policy from 12-35 years. It also has a stretched age limit wherein it can be availed by anyone between 8-55 years and the same can be continued to as long as 75 years.

The Policy is entitled to regular premium payment for the entire tenure. If an insured person survives the policy term, he/she will be entitled to the maturity benefit that is, Sum Assured along with vested Simple Reversionary Bonus + Final Addition Bonus.

The plan is referred by the experts and has also gained popularity in the customer market because of the lucrative benefits it offers. The plan is enlisted under the vanilla plans of LIC that offer death and maturity benefits. Here, we will discuss the plan in details.

LIC New Endowment - Key Features

  • LIC New Endowment Plan is a participating traditional plan.
  • The premium payment is to be paid for the entire tenure.
  • On survival at the end the policy tenure, the policy pays the benefits to the survivor.
  • In the case of the death of the insured person, the death benefits are paid to the nominee and the policy terminates.
  • The insured person seeks additional coverage, the plan can be extended with additional premium payment.
  • The plan also pays simple reversionary bonus on maturity or death whatever be the condition.
  • There is a massive sum assured rebate available in the plan.
  • The plan guarantees assured returns and bonus.
  • An insured person can also avail LIC's Accidental Death and Disability Benefit Rider.

LIC New Endowment - Benefits

LIC New Endowment Plan is quoted as a lucrative plan considering the assured benefits and widespread options of additional coverage, age limit, and term choices. The plan offers three prime benefits; Death Benefit, Maturity benefit & Income Tax Benefit. Here are the benefits in details:

1. Death Benefit

In case the insured person dies without surviving till the maturity date, the nominee of the insured person would be paid the “Sum Assured on Death” + vested bonuses as Death Benefit. The policy would terminate then and there.

The "Sum Assured on Death" is defined as either higher of Basic Sum Assured or 10 times the Annualized Premium, whichever is higher. However, this is subject to a minimum of 105% of all premiums paid.

Benefits LIC New Endowment

2. Maturity Benefit

If the insured person survives the tenure of the policy, he/she would be paid Sum Assured + accrued Reversionary Bonus + Final Addition Bonus (if any) under the maturity benefits and the policy terminates there and then.

3. Income Tax Benefits

Like many other Endowment plans of LIC, the New Endowment Plan offers tax benefits to the insured person. Under this benefit, the life insurance paid by the insured person up to Rs. 1,50,000 are eligible for deduction from the taxable income under the Income Tax Act, Section 80 ( C). The maturity benefit is also tax-free under the Income Tax Act, Section 10 ( D) subject to the fulfilment of all terms and conditions.

4. Loan Benefit

The insured person can avail a loan under the policy. However, the amount of the loan depends upon the terms & conditions as well as the surrender value that the policy has gained.

LIC New Endowment - Eligibility Criteria

Minimum Maximum
Sum Assured (in Rs.)1,00,000, in multiples of 5,000No Limit
Policy Term(in years) 1235
Premium Payment Term (in years) Equal to Policy Term
Entry Age of Life Insured (in years) 855
Age at Maturity (in years) -75 years
Monthly Premium (in Rs.) For Age 12 to 49 years: Rs.250/-Rs. 10,000/-
Payment modes Yearly, Half Yearly, Quarterly or Monthly

Product Specification of LIC New Endowment Plan

55 yrs8 yrs
75 yrs-Maturity Age
35 yrs12 yrsPolicy Term (in years)
Equivalent to the Policy TermPremium Paying Term (in Years)
Monthly/ quarterly/ half yearly/ annuallyPremium Paying Frequency
No set limitRs. 1 Lakh Sum Assured

Additional Bonuses under the LIC New Endowment Plan

The policy offers two additional benefits; Riders & Bonus:

Riders : The policy has an additional rider benefit associated with it; Accidental Death and Disability Benefit Rider.

Bonus : The policy has an additional rider benefit associated with it; Accidental Death and Disability Benefit Rider.

Simple Reversionary Bonus : The sum is declared annually and is calculated at the end of the year upon per thousand Sum Assured. Once declared, the bonus becomes a guaranteed benefit under the policy. The bonuses thus calculated are taken for a term of the policy or the death of the insured person, whichever happens, earlier. The Simple Reversionary Bonus accrues during the term of the premium payment and is paid either at the end of the term or on death, whatever occurs earlier. It is paid along with other additional benefits.

Final Addition Bonus : This bonus is payable if the policy has been active for a minimum period as per the terms and conditions.

Sample illustration: Simple Reversionary Bonus

Kanchan bought an LIC New Endowment Plan for 25 years, for Sum Assured of Rs 10 lacs. If, under the policy, the Simple Reversionary Bonus for a particular financial year is Rs 30; the total bonus that Kanchan accrues during the plan will be:

Bonus=30/1,000 X Sum Assured=30/1,000 X 10,00,000=30,000 for that particular year. Let's assume that the bonus remains the same every year throughout the policy tenure of 25 years. The bonus that Kanchan accrues is equal to=30,000 X 25=7,50,000

Final Bonus

The final bonus does not get affected by the number of years, but it is dependent on the value of the Sum assured per thousand. Assuming that Rs. 200 is to be paid per thousand the Final bonus will be=Rs 200/1,000 * Rs.10,00,000=Rs.2,00,000

Total Bonus

Total Bonus is equals to Simple Reversionary Bonus + Final Addition Bonus

Total Bonus=Rs.7,50,000 + Rs.2,00,000=Rs 9,50,000

Other Policy Details

Grace Period

In the case of delay in the premium payment, a grace period of 30 days is provided by the company. If the insured person fails to pay the premium during the grace period, the policy lapses. To revive the policy, the premium must be paid within two years of the last unpaid premium.

Free Look Period

In case you are hesitant to purchase the policy and have confusion regarding the terms and conditions, the company provides you a provision of free look up period. Under this period you have the authority to cancel the policy within 15 days of the receipt of the policy paper. The only prerequisite is that no claim should be made.

In the case of:

Unpaid Premium

In case you stop paying the premium even after the grace period, the policy lapses. But, if you paid regular premiums for the first three years you can revive the policy on a Reduced Sum Assured.

Reduced Sum Assured=Basic Sum Assured *(Number of Premiums Paid / Total Number of Premiums Payable)


Once the policy accrues Cash Value, that is, when a minimum of three years of premiums has been paid, you can surrender it. The percentage, however, depends upon policy term, year of surrender and as specified in the table.

Other Policy Details

Stop paying the premium - If the premiums are not paid within the Grace Period, the policy lapses and all benefits associated with the same will cease. However, if at least 3 years’ premiums have been paid, the policy acquires a Paid up Value for a Reduced Sum Assured but the policy will be liable for any future regular additions.

Reduced Sum Assured - Basic Sum Assured *(Number of Premiums Paid / Total Number of Premiums Payable)

The policy can however be revived within 2 consecutive years from the date of first unpaid premium.

A loan against your policy - Loan can be availed under the policy offered the policy has acquired a surrender value and subject to the terms and conditions.


In case an insured person commits suicide within 12 months of policy commencement, the nominee is entitled to 80% the premiums paid.

In the case of the suicide occurs within 12 months of policy revival 80% of the premium paid or acquired surrender value, whichever is higher, is paid.

Optional Benefit:

LIC’s Accidental Death and Disability Benefit Rider: LICs Accidental Death and Disability Benefit Rider is there with this plan as an optional rider by payment of additional premium. In case of accidental death, the Accident Benefit Sum Assured will be payable as lumpsum along with the death benefit under the basic plan. In case of accidental permanent disability that occurs because of an accident (within 180 days from the date of accident), an amount that would be equal to the Accident Benefit Sum Assured will be paid in equal monthly installments which is spread over 10 years and future premiums for Accident Benefit Sum Assured as well as premiums for the portion of Basic Sum Assured that is equal to Accident Benefit Sum Assured under the policy, shall be waived.

Documents Required

To avail the policy, the policyholder has to deposit a duly filled application form or proposal form attached with the medical history of the person seeking the policy. All KYC documents including a valid address proof is a must for buying the LIC New Endowment Policy. Based on the age of the insured person and the sum assured, the company might ask for a medical examination.

LIC New Endowmwnt Plan: FAQs

1. What are Endowment Plans?

An endowment policy is a life insurance policy that, in addition to protecting the insured's life, assists the policyholder in saving consistently over a certain length of time so that, if they survive the policy term, they can receive a lump sum payment at the policy's maturity.

2. Can I avail of loans under the LIC Endowment policy?

Yes, you can. Since the plans have maturity benefits, you can avail yourself of a loan against them.

3. Which is the LIC’s New Endowment Plan?

The recently launched LIC New Endowment Plan is LIC Bima Ratna. The plan offers the benefit of both protection and savings.

4. Are LIC Endowment plans beneficial to buy?

LIC Endowment plans are a combination that provides financial support to the family in case something unfortunate happens to the policyholder. These plans also look after the immediate financial needs through its loan facility.

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Last updated on July, 2022