LIC Jeevan Umang Advantages and Disadvantages 2023

LIC Jeevan Umang is a popular life insurance plan offered by the Life Insurance Corporation of India (LIC). It is a non-linked, participating, whole life assurance plan that provides both life cover and maturity benefits. This article explores the advantages and disadvantages of LIC Jeevan Umang, helping you make an informed decision about this insurance plan.

What is LIC Jeevan Umang?

LIC Jeevan Umang is a comprehensive life insurance policy that offers financial protection to policyholders throughout their lifetime. It combines the benefits of life cover, guaranteed survival benefits, and a lump sum maturity amount. The plan provides a regular income stream after the completion of the premium payment term, ensuring financial stability for policyholders and their families.

Brief overview about the plan

Under LIC Jeevan Umang, policyholders pay premiums for a specific period, known as the premium payment term. The policy continues to provide life cover even after the premium payment term ends, making it a whole life insurance plan. The policyholders also receive survival benefits, which are a percentage of the sum assured, at regular intervals after the premium payment term.

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LIC Jeevan Umang Advantages

LIC Jeevan Umang offers several advantages that make it an attractive life insurance option for individuals seeking long-term financial protection. Some of the key advantages are:

1. Guaranteed survival benefits
2. Maturity benefits
3. Life cover throughout the policy term
4. Additional riders for enhanced coverage
5. Tax benefits

Guaranteed survival benefits:

One of the significant advantages of LIC Jeevan Umang is the guaranteed survival benefits. Policyholders receive a percentage of the sum assured as survival benefits, which are paid annually after the premium payment term. These benefits act as a regular income stream, providing financial support for various needs such as children’s education, medical expenses, or retirement planning.

Maturity benefits:

Upon reaching the maturity of the policy, policyholders receive a lump sum amount that includes the sum assured and accrued bonuses. This maturity benefit can be utilized to fulfill long-term financial goals, such as purchasing a house, funding higher education, or ensuring a comfortable retirement.

Life cover throughout the policy term:

LIC Jeevan Umang provides life cover throughout the policy term, including the premium payment term and beyond. This ensures that your loved ones are financially protected in case of an unfortunate event. The death benefit paid to the nominee can help them cover expenses and maintain their standard of living.

Additional riders for enhanced coverage:

Policyholders have the option to enhance the coverage of LIC Jeevan Umang by adding riders or additional benefits to the policy. Riders like critical illness cover, accidental death benefit, or disability cover can provide extra protection against unforeseen circumstances, ensuring comprehensive financial security for you and your family.

Tax benefits:

LIC Jeevan Umang offers tax benefits under the Income Tax Act, 1961. The premiums paid towards the policy are eligible for tax deductions under Section 80C, while the maturity proceeds or death benefits are tax-exempt under Section 10(10D). These tax benefits help policyholders reduce their overall tax liability.

LIC Jeevan Umang Disadvantages

While LIC Jeevan Umang comes with several advantages, it’s essential to consider the following disadvantages before making a decision:

1. Higher premium compared to term plans
2. Limited flexibility in premium payment
3. Lower returns compared to market-linked plans
4. Long-term commitment

Higher premium compared to term plans:

Compared to pure term insurance plans, LIC Jeevan Umang has a higher premium due to the additional benefits and coverage it offers. If your primary goal is to obtain maximum life cover at an affordable cost, term insurance plans may be more suitable for you.

Limited flexibility in premium payment:

LIC Jeevan Umang has a fixed premium payment term, and policyholders need to make regular premium payments throughout this period. There is limited flexibility in altering the premium payment frequency or duration, which may not be suitable for individuals seeking more flexibility in managing their premium payments.

Lower returns compared to market-linked plans:

LIC Jeevan Umang is a traditional life insurance plan that offers guaranteed returns along with bonuses. However, the returns provided by such plans are generally lower compared to market-linked plans like Unit-Linked Insurance Plans (ULIPs) or mutual funds. If you are comfortable with market-linked investments and are willing to take higher risks, you may explore other investment avenues for potentially higher returns.

Long-term commitment:

LIC Jeevan Umang is a long-term commitment as it offers life cover for the entire policy term, which can extend beyond the premium payment term. If you are unsure about your financial goals or foresee the need to discontinue the policy in the future, this long-term commitment may not be suitable for you.

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Comparison with other insurance plans

To help you make a well-rounded decision, it’s crucial to compare LIC Jeevan Umang with other insurance plans available in the market. Here’s a brief comparison:

• Term insurance plans: Term insurance plans provide pure life cover for a specific term at an affordable premium. They do not offer any maturity benefits or survival benefits. If you are primarily looking for high life cover at a low cost, term insurance plans may be more suitable for you.

• Unit-linked insurance plans (ULIPs): ULIPs are market-linked insurance plans that offer both life cover and investment opportunities. They provide the flexibility to invest in various funds, including equity, debt, or balanced funds, based on your risk appetite. ULIPs offer potentially higher returns but involve market-related risks.

• Endowment plans: Endowment plans are traditional life insurance plans that offer a combination of life cover and savings. They provide maturity benefits along with the sum assured. While they may offer better returns than LIC Jeevan Umang, the life cover provided by endowment plans is usually lower.

Is LIC Jeevan Umang suitable for you?

Deciding whether LIC Jeevan Umang is suitable for you depends on several factors. Consider the following aspects before purchasing this plan:

Factors to consider before purchasing

• Financial goals: Evaluate your long-term financial goals and check if LIC Jeevan Umang aligns with them.
• Risk appetite: Assess your risk appetite and willingness to invest in market-linked plans or opt for guaranteed returns.
• Affordability: Ensure that the premium payments fit comfortably within your budget.
• Coverage needs: Determine the amount of life cover you require to provide adequate financial protection for your loved ones.

Who can benefit the most from this plan?

LIC Jeevan Umang is suitable for individuals who:

• Seek a comprehensive life insurance plan with guaranteed survival benefits.
• Want a regular income stream after the premium payment term.
• Prefer traditional life insurance plans over market-linked investment options.
• Are comfortable with a long-term commitment.

How to Apply for LIC Jeevan Umang?

Applying for LIC Jeevan Umang, a comprehensive life insurance plan offered by the Life Insurance Corporation of India (LIC), is a simple and straightforward process. Follow these steps to apply for LIC Jeevan Umang and secure financial protection for yourself and your loved ones:

Step1. Research and Understand the Plan

Before applying for LIC Jeevan Umang, it’s important to research and gather information about the plan. Understand its features, benefits, premium payment terms, maturity benefits, and the coverage it offers. This will help you make an informed decision and ensure that the plan aligns with your financial goals.

Step2. Check Eligibility Criteria

Review the eligibility criteria specified by LIC for LIC Jeevan Umang. This includes factors such as minimum and maximum entry age, the minimum sum assured, and any other requirements set by the company. Ensuring you meet the eligibility criteria will save you time and effort during the application process.

Step3. Gather Required Documents

Prepare the necessary documents that will be required for the application process. These typically include identity proof, address proof, age proof, income proof, and other relevant documents as specified by LIC. Having these documents ready in advance will expedite the application process and prevent any delays.

Step4. Visit LIC Branch or Apply Online

There are two options for applying for LIC Jeevan Umang: visiting a nearby LIC branch or applying online through the official LIC website. Choose the option that is most convenient for you. If you prefer a face-to-face interaction and guidance, visiting a branch is recommended. If you prefer the convenience of online application, access the LIC website.

Step5. Fill out the Application Form

Whether you visit a branch or apply online, you will need to fill out the application form for LIC Jeevan Umang. Provide accurate and complete information in the form. Double-check all the details before submitting to ensure there are no errors or omissions.

Step6. Submit Required Documents

Along with the application form, submit all the required documents as specified by LIC. Ensure that the documents are legible and properly attested or self-attested as per the guidelines. This will help facilitate the verification process.

Step7. Pay the Premium

Make the initial premium payment as per the premium payment mode chosen by you. LIC offers various options for premium payment such as annual, semi-annual, quarterly, or monthly. Choose the payment mode that suits your financial preferences and make the payment accordingly. Keep the payment receipt for future reference.

Step8. Undergo Medical Examination (if required)

Depending on your age and the sum assured opted for, LIC may require you to undergo a medical examination. This is done to assess your health condition and determine the premium amount. If a medical examination is required, follow the instructions provided by LIC and complete the examination as scheduled.

Step9. Wait for Policy Approval

After submitting the application form and required documents, LIC will review your application. They will verify the information provided, conduct necessary checks, and assess the risk. This process may take some time, so it’s important to be patient during this waiting period.

Step10. Receive Policy Document

Once your application is approved, LIC will issue the policy document for LIC Jeevan Umang. The policy document contains all the details of your policy, including the sum assured, premium payment schedule, maturity benefits, and terms and conditions. Carefully review the policy document to ensure all the information is accurate.

By following these steps, you can successfully apply for LIC Jeevan Umang and secure a comprehensive life insurance plan that provides financial protection and benefits for you and your family. Remember to provide accurate information, gather the required documents, and make the

premium payments on time to enjoy the full benefits of the plan.

Tips for maximizing benefits

To maximize the benefits of LIC Jeevan Umang, consider the following tips:

#1. Regular premium payment

Ensure timely payment of premiums throughout the premium payment term to keep the policy active and avail all the benefits.

#2. Evaluating riders and add-ons

Assess the additional riders or add-ons available with LIC Jeevan Umang and choose the ones that align with your specific coverage needs.

#3. Reviewing the policy periodically

Periodically review your policy to ensure it continues to meet your financial goals and make any necessary adjustments based on changes in your circumstances.

Conclusion

LIC Jeevan Umang offers a comprehensive life insurance solution with guaranteed survival benefits, maturity benefits, and life cover throughout the policy term. While it provides financial security, it’s essential to consider the higher premium, limited flexibility, and lower returns compared to market-linked plans. Assess your financial goals, risk appetite, and coverage needs to determine if LIC Jeevan Umang is the right choice for you.

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FAQs about LIC Jeevan Umang plan