LIC New Jeevan Amar Plan Review

When seeking a life insurance policy, potential policyholders usually opt for brands with an extensive insurance track history. This is a smart financial move, considering that your policy will act as your financial replacement for your family in the event of your unfortunate absence. Subsequently, since the cover amount is your income replacement, it is often a considerably large amount (often in crores). Thus, it's only logical that you would want a reputed insurer to handle the claim settlement and settle it hassle-free when required.

Hence, LIC or Life Insurance Corporation of India, had always been a popular choice, considering its status as India’s oldest and largest public sector insurance company. However, the insurer's reputation isn’t the sole factor when purchasing a life or term insurance policy. The plan's features, the riders offered, the restrictions and the cappings should be a priority, too. This is where LIC loses the game - non-comprehensive policies with limited riders and pricey premiums.

So, is the LIC New Jeevan Amar Plan a disappointment or a good pick as a vanilla term insurance policy? Here’s what we think!

Quick Verdict on LIC New Jeevan Amar Plan

LIC New Jeevan Amar Plan isn’t a comprehensive policy. It is neither affordable nor has many features, and it only offers a single rider. Thus, this offline policy fails to be a recommended choice for policyholders seeking flexible, affordable, and comprehensive plans despite being provided by a credible life insurer.

LIC New Jeevan Amar Plan: Brief Overview

Established in 1956, LIC is an insurer with an unmatched track record, considering it’s the oldest insurer in the country. Currently, the insurer's annual average business stands at ₹205,137 crores. Naturally, the insurer once monopolised the industry, offering products across life insurance, term insurance, whole life insurance, ULIPs, Endowment plans, retirement policies, and more.

However, despite years of experience in the industry, LIC has failed to retain its popularity because of the policy's lack of comprehensiveness and the pricier premiums.

For example, in the case of top-term insurance plans, insurers offer in-built and rider perks like Terminal Illness Benefits, surrender benefits, Return of Premium, Critical Illness Rider Benefits, Total and Permanent Disability Riders, and more at affordable premiums. However, in most term insurance plans from the stable of LIC, such features are missing. The LIC New Jeevan Amar Plan is no exception.

Thus, despite having great credibility in the insurance industry (as reflected in the data below), the insurer still fails to meet expectations.

• Claim Settlement Ratio (CSR) of 98.71% (the industry average is  97.74%)
• Amount Settlement Ratio (ASR) of 95.1 (the industry average is  90.9%)
• Complaint Volume of 10.5 (the industry average is  72.8)

The LIC New Jeevan Amar Plan can be called the offline version of the LIC Tech Term Plan Review. The New Jeevan Amar policy is available only in the offline mode and comes with limited features. The policy offers a couple of built-in perks like the standard death benefit (and another option to include the inflation-based increase in coverage), special rates for women, and the standard difference in premiums for smoker and non-smoker profiles.

Additionally, the plan offers a single-term insurance rider- the Accidental Death Benefit. This is an unfair break from the traditional top-notch term insurance policies, providing diverse add-ons to customise a policy significantly. Since the plan offers a single rider, policyholders are deprived of the flexibility of a term insurance policy.

In a nutshell, the LIC New Jeevan Amar Plan may not be a good choice as a term insurance plan. However, if you are a brand loyalist and are looking into the New Jeevan Amar Plan, here’s a list of its limited features -

LIC New Jeevan Amar Plan: Table of Features

Should You Buy LIC New Jeevan Amar Plan?

1. LIC as an insurer: LIC is an age-old insurer with an extensive insurance track record. Once, the brand was considered synonymous with life insurance plans. However, now that comprehensive and affordable term insurance policies have emerged from credible life insurers, LIC is no longer the popular and obvious choice.

Thus, despite having a good Claim Settlement Ratio, a great Amount Settlement Ratio and low complaint volume, the insurer’s lack of innovation in its term insurance products has resulted in its loss of foothold in the industry.

2. In-built features of the plan: As mentioned before, for the LIC New Jeevan Amar Plan, the in-built features are stingingly limited -

• Death Benefit: Much like any standard term insurance policy, the New Jeevan Amar Plan offers a death benefit of a minimum of ₹25 lakhs (the maximum limit is based on the discretion of the underwriting team and your eligibility) in case the policyholder passes away during the policy tenure.

Under the LIC New Jeevan Amar Plan, there are 2 death benefit options:

- Level Sum Assured: The cover amount is constant, as was chosen during the policy purchase. This amount is disbursed upon the death of the policyholder to the beneficiary.

- Increasing Sum Assured: The base sum assured increases by 10% from the 6th policy year onwards until either the policyholder passes away, the sum assured reaches 200%, or the 15th policy year ends (whichever comes earlier).

• Discount of premiums for women policyholders: In the case of women policyholders, under the LIC New Jeevan Amar Plan, the premiums are significantly reduced.
• Different premium rates for smokers and non-smokers: Like any other term insurance policy, this plan has separate premiums for smoking and non-smoking profiles. However, these premiums are higher than those charged for the best-term insurance plans from other credible insurers.

3. Available Riders: If you have compared plans from the best term insurance providers, you know this -  term insurance plans come with value-worthy riders like Critical Illness Benefit, Accidental Total and Permanent Disability Rider, Waiver of premium, Life Stage Benefits, Income Benefits on Accidental Disability Rider, Personal Accident Cover, Cancer Cover, Hospi Care Benefit, and more. These riders aim to customise the policies and cater to the tailored financial requirements of policyholders.

Unfortunately, in the case of the LIC New Jeevan Amar Plan, a single rider is available: Accidental Death Benefit. If the policyholder passes away due to an accident, LIC offers him/her an additional sum over and above the base sum assured.

What’s Unique About the LIC New Jeevan Amar Plan?

Unfortunately, the LIC New Jeevan Amar Plan has nothing unique to offer—a basic death benefit option or a death benefit with an inflation-based increasing cover amount, a special premium rate for women policyholders, a standard differentiating premium for smoking and non-smoking policyholders, and a single rider: the Accidental Death Benefit Rider.

Conclusion

LIC New Jeevan Amar Plan is only an option if you are fixated on LIC as your term insurance provider because the policy is as basic as it gets, with no features worth mentioning.

Thus, we recommend that you look into the best term insurance policies from other insurers and prioritise a plan’s premiums, features, and riders before purchasing it.