Lic Money Back Policy Calculator
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Reviewed by Calculator Editorial Team
Life Insurance Corporation (LIC) offers various money back policies that provide both life cover and regular payouts. This calculator helps you estimate the returns from an LIC money back policy based on your investment amount, policy term, and premium payment term.
How LIC Money Back Policy Works
An LIC money back policy is a type of endowment policy that combines life insurance protection with regular payouts. These policies are designed to provide financial security to policyholders while also offering a guaranteed return on investment.
Key Features
- Life cover: The policy provides financial protection to the policyholder's family in case of death
- Regular payouts: The policyholder receives regular payouts (usually annual) during the policy term
- Guaranteed returns: The policy offers a guaranteed return on the investment amount
- Flexible premium payment options: Policyholders can choose to pay premiums annually, semi-annually, quarterly, or monthly
How Premiums Work
The premium amount is calculated based on factors such as the policyholder's age, health, and the sum assured. The premium amount remains constant throughout the policy term, making it easier for policyholders to budget.
Policy Term vs. Premium Payment Term
The policy term is the duration for which the policy remains active, while the premium payment term is the period during which the policyholder pays the premium. In some policies, the premium payment term may be shorter than the policy term, allowing the policyholder to receive payouts even after premium payments have stopped.
Note: The actual returns from an LIC money back policy may vary based on the specific policy chosen and the policyholder's age and health. It's important to carefully review the policy terms and conditions before purchasing.
LIC Money Back Policy Calculator
Use this calculator to estimate the returns from an LIC money back policy based on your investment amount, policy term, and premium payment term.
Formula Used
The calculator uses the following formula to estimate the returns from an LIC money back policy:
Total Returns = (Annual Premium × Premium Payment Term) + (Annual Payout × Policy Term)
Where:
- Annual Premium = Premium Amount × 12 (if premiums are paid monthly)
- Annual Payout = Sum Assured × Annual Payout Rate
The calculator assumes a standard annual payout rate of 5% for the purpose of estimation. The actual payout rate may vary based on the specific policy chosen.
Worked Example
Let's consider an example to understand how the calculator works:
Example Scenario
- Policy Term: 20 years
- Premium Payment Term: 15 years
- Premium Amount: ₹10,000 per year
- Sum Assured: ₹5,00,000
Calculation
- Total Premium Paid = ₹10,000 × 15 = ₹1,50,000
- Annual Payout = ₹5,00,000 × 5% = ₹25,000
- Total Payouts = ₹25,000 × 20 = ₹5,00,000
- Total Returns = ₹1,50,000 + ₹5,00,000 = ₹6,50,000
In this example, the policyholder would receive a total of ₹6,50,000 over the 20-year policy term, including the premiums paid and the payouts received.
Comparison of LIC Policies
LIC offers a variety of money back policies with different features and benefits. Here's a comparison of some popular LIC money back policies:
| Policy Name | Policy Term | Premium Payment Term | Payout Frequency | Guaranteed Returns |
|---|---|---|---|---|
| LIC Jeevan Anand | 15-20 years | 10-15 years | Annual | Yes |
| LIC Jeevan Tarun | 15-20 years | 10-15 years | Annual | Yes |
| LIC Jeevan Akshay | 15-20 years | 10-15 years | Annual | Yes |
| LIC Jeevan Nidhi | 15-20 years | 10-15 years | Annual | Yes |
It's important to carefully review the features and benefits of each policy before making a decision. Consulting with a financial advisor can help you choose the right policy based on your specific needs and financial goals.
Frequently Asked Questions
What is an LIC money back policy?
An LIC money back policy is a type of endowment policy that combines life insurance protection with regular payouts. These policies are designed to provide financial security to policyholders while also offering a guaranteed return on investment.
How do I calculate the returns from an LIC money back policy?
You can use the LIC money back policy calculator to estimate the returns based on your investment amount, policy term, and premium payment term. The calculator uses a standard formula to provide an estimate of the total returns.
What factors affect the returns from an LIC money back policy?
The returns from an LIC money back policy can be affected by factors such as the policy term, premium payment term, premium amount, sum assured, and the specific policy chosen. It's important to carefully review the policy terms and conditions before purchasing.
Can I receive payouts even after premium payments have stopped?
Yes, in some LIC money back policies, the premium payment term may be shorter than the policy term, allowing the policyholder to receive payouts even after premium payments have stopped.
How do I choose the right LIC money back policy?
Choosing the right LIC money back policy depends on your specific needs and financial goals. It's important to carefully review the features and benefits of each policy and consult with a financial advisor if needed.