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Benefits of the LIC Tech Term Plan

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LIC Tech Term Plan (UIN – 512N351V01) is a life cover policy brought by the Life Insurance Corporation of India (LIC). This policy ensures that in the tragic event of the life assured's demise, the beneficiaries are compensated with an amount equating to the sum assured.

Beyond its primary feature of death coverage, the LIC tech term plan boasts an array of distinctive benefits, encompassing rider benefits and specialised premium rates tailored for women and non-smokers.

In this article, we will be highlighting the myriad advantages associated with the LIC tech term plan, guiding potential and current policyholders towards a comprehensive understanding of its offerings.

LIC Tech Term Plan – An overview

The LIC tech term plan is a testament to LIC's commitment to adapting and offering innovative insurance solutions tailored to the modern-day individual. Primarily functioning as a pure life cover policy, it's designed to provide beneficiaries with a financial safety net in the unfortunate event of the policyholder's demise.

What sets the LIC tech term plan apart is its range of comprehensive features that prioritise flexibility and user-centric benefits. For instance, the policyholder can choose between two types of sum assured options: the 'Level Sum Assured' and the 'Increasing Sum Assured'.

Features of LIC Tech Term Plan

The LIC Tech Term Plan is not just another term insurance plan; it is rather crafted keeping in mind the evolving needs of policyholders. With features that focus on flexibility and security, this plan truly stands apart from the wide array of term plans available in the market. 

Let’s take a look at some of the noteworthy features of the LIC Tech Term Plan -

  • Grace Period - Policyholders are provided with a grace period of 30 days after the due date, applicable for both yearly and half-yearly payment modes. This ensures that the policyholders have ample time to make their premium payments without the policy lapsing.
  • Revival Period - Owing to the unpredictability of life, premium payments may sometimes be missed. However, LIC offers a revival period wherein one can revive their lapsed LIC tech term policy within 5 years from the end of the grace period.
  • No Policy Loan - It is essential to note that the LIC tech term plan does not provide any loan against the policy. This keeps the policy straightforward and devoid of any complexities related to loans.
  • Free Look Period - LIC offers a free look period of 30 days. During this timeframe, if a policyholder feels that the plan may not be suitable for their needs, they have the liberty to cancel it.
  • Surrender Value - For those opting for a regular premium, it's crucial to be aware that there is no refund amount upon surrender. However, in the case of single premium policies, a refund can be availed at any time during the policy term.

As for the limited term, refunds are accessible only if the plan has been in effect for over 2/3rd of its term.

Advantages of the LIC Tech Term Plan

The LIC tech term plan presents a remarkable blend of thoughtful features and user-centric advantages, designed to offer peace of mind and financial security to its policyholders. Tailored for those seeking a plan that not only provides a safety net for their loved ones but also offers flexibility in its offerings, the LIC tech term plan truly stands out.

Let's explore its advantages in detail -

  • Comprehensive Death Benefit

The plan offers a death benefit, which ensures that the beneficiaries receive the sum assured in case of any unfortunate event leading to the policyholder's demise.

  • Level Sum Assured: In this option, the sum to be paid upon death remains unchanged throughout the term. It offers simplicity and predictability for the beneficiaries.
  • Increasing Sum Assured: Initially, the death benefit remains consistent up to the completion of the 5th policy year. However, starting from the 6th policy year and continuing up to the 15th year, there's an increment of 10% in the basic sum assured every year, until it doubles. After the 15th year, the sum to be paid on death remains constant and amounts to twice the basic sum assured.
  • For regular and limited premium payment modes, the sum assured on death will be the highest of the following: 7 times the annual premium, 105% of all premiums paid up to that time, or the absolute sum assured on death. 

In contrast, for the single premium mode, the sum assured on death is either 125% of the single premium or the absolute sum assured on death, whichever is higher.

  • Flexible Premium Payment Frequency

The plan offers a spectrum of payment frequencies catering to the diverse financial requirements and capabilities of individuals - 

  • Single Payment
  • Limited Payment
  • Regular Payment
  • Convenient Premium Payment Modes

To suit different payment preferences, the plan provides:

  • Yearly Payment Mode
  • Half-Yearly Payment Mode
  • Added Security with Rider Benefits

For those seeking an added layer of protection, the plan comes with the accidental benefit rider. This is available under both regular and limited premium payment policies, so that the beneficiaries are well taken care of even in the face of accidental contingencies.

  • Clarity in Benefits

It's worth noting that this plan focuses solely on providing a death benefit without any maturity benefit. This ensures that the policyholder's primary objective of safeguarding their family's future remains undiluted.

How is the Death Benefit Calculated?

When it comes to the LIC tech term plan, understanding the intricacies of how the death benefit is computed and disbursed is crucial. It not only aids policyholders in making informed decisions but also ensures that beneficiaries are well-prepared for the financial processes that follow an unfortunate event.

The beneficiaries have two primary options when it comes to receiving the death benefit -

  • Lump Sum Payment (Option 1) - Under this option, the entire death benefit is paid out at once. This is especially suitable for beneficiaries who might have immediate financial needs or those who prefer to manage a larger amount at their discretion.
  • Instalment Payment (Option 2) - For those who believe in steady financial inflows or wish to ensure managed expenses over a specific period, the plan offers the flexibility to receive the death benefit in instalments spanning over 5 years. These instalments can be:
  1. Yearly: Once every year
  2. Half-Yearly: Twice in a year, typically every six months
  3. Quarterly: Four times a year, essentially every three months
  4. Monthly: Every month, ensuring a regular flow of funds

The choice of instalment intervals rests with the policyholder, allowing them to align the payments with the expected financial requirements of their beneficiaries.

Eligibility Criteria for LIC Tech Term Plan

The LIC tech term plan, while designed for a wide audience, does come with its stipulations to ensure that the policy is not only viable for the company but also tailored for the target demographic. 

Listed below are the essential eligibility criteria - 

Age Bracket for Entry

  • Minimum Age: 18 years
  • Maximum Age: 65 years

This ensures that the policy covers a broad spectrum of adults, from those just entering the workforce to those nearing retirement.

Maturity Age

While the policy is designed to provide cover for a significant duration, there's an age limit by which the policy matures, post which the coverage ceases.

  • Maturity Age: 80 years

Duration of Policy Term

The flexibility in term durations allows policyholders to choose the length of coverage that best aligns with their financial planning and life goals.

  • Minimum Term: 10 years
  • Maximum Term: 40 years

Range of Sum Assured

LIC understands that every individual's financial obligations and responsibilities differ. Hence, the company offers a flexible range for the sum assured:

  • Minimum Sum Assured: INR 50,00,000
  • Maximum Sum Assured: No upper limit

Over to You

The LIC tech term plan underscores the understanding of the LIC of modern requirements and its commitment to safeguarding the future of its policyholders. 

With its adaptive features, ranging from varied sum assured options to flexible premium payment modes, this plan ensures that insurance is not just a mere contract but a personalised financial companion. Moreover, the versatility in death benefit disbursements underscores the plan’s holistic approach, catering to beneficiaries' varied financial circumstances. 

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