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LIC’s Aadhaar Shila: A Blend of Protection & Savings Plan For Women


The Aadhaar Shila plan from LIC is a non-linked, individual life assurance plan that is intended specifically for women and provides both protection and savings. This plan offers financial assistance to the policyholder's family in the event of the policyholder's untimely death before maturity, as well as a lump sum payment to the survivors at maturity. Furthermore, with its Auto Cover and loan facility, this plan would meet all the financial demands of women. Let's talk all about the scheme and find a conclusion as to whether this scheme is a good bet for women or not.


Benefits of LIC’s Aadhaar Shila Plan

Benefits of LIC’s Aadhaar Shila Plan

Following are the different types of benefits under the plan which women individuals must need to know about before purchasing:

Death Benefit: If the insured person dies during the policy term and the policy is in-force (i.e. all due premiums have been paid), the following death benefit will be paid: on death within the first five years i.e. sum assured on death. When a policyholder dies after five years but before the policy's maturity date, the sum assured on death i.e. 7 times of annualised premium; or 110% of Basic sum assured and any loyalty addition, if any, shall be payable. The death benefit must equal at least 105 percent of the overall premiums contributed up to the time of death. Taxes, additional premiums, and rider premiums, if any, are not included in the stated premiums.

Maturity benefit: If the life assured lives to the end of the policy term and all outstanding premiums have been paid, the "Sum Assured on Maturity," which is equal to the Basic Sum Assured plus any Loyalty Addition, will be granted.

Loyalty Addition: If the policy has accomplished five effective years and at least five full years' premium has been contributed, policies under this plan may be eligible for Loyalty Addition at the time of exit in the form of Death during the policy term or Maturity, at such rate and on such terms as the Corporation may declare, based on the Corporation's experience. Loyalty Addition is payable for the completed policy years during which the policy was in existence under a paid-up policy.

Furthermore, if there is a Loyalty Addition, it will be taken into account when calculating the Special Surrender Value when the policy is surrendered during the policy term, given the policy has finished five policy years and at least five full years' premium has been made successfully.

Payment of premiums: Premiums can be paid on an annual, half-yearly, quarterly, or monthly basis (monthly premiums are exclusively available via NACH) or by salary deductions during the policy's duration.

Grace period: From the date of the first missed premium, a grace period of 30 days for annual, half-yearly, or quarterly premiums and 15 days for monthly premiums will be granted. During this time, the policy will be deemed in force, with the risk cover continuing uninterrupted as per the policy's conditions. The policy will terminate if the premium is not paid before the grace period expires. The aforementioned grace period will also apply to rider premiums, which are paid in addition to the standard insurance premium. The policy will terminate if premiums are not paid during the grace period. A discontinued policy can be reactivated for a period of 5 years from the date of the first delinquent premium but before the Maturity date, whichever comes first.

Eligibility Criteria

Eligibility Criteria

This plan is only offered to those who live normal, healthy lifestyles and have never had a medical checkup. The following are the eligibility conditions that women should be aware of.

a) Minimum Basic Sum Assured per life: Rs 75,000

b) Maximum Basic Sum Assured per life: Rs 300,000. The Basic Sum Assured shall be in multiples of Rs 5,000/- from Basic Sum Assured Rs 75,000 to Rs 1,50,000/- and Rs 10,000/- for Basic Sum Assured above Rs 1,50,000/-

c) Minimum Age at entry 8 years (completed)

d) Maximum Age at entry 55 years (nearest birthday)

e) Policy Term 10 to 20 years

f) Premium Paying Term Same as Policy Term

g) Maximum Age at Maturity 70 years (nearest birthday)

(h) A person's total Basic Sum Assured under all policies provided under this plan should not surpass Rs 3 lakh.

(i) Date of commencement of risk: The risk will begin immediately under this plan, as soon as the risk is accepted.

(j) Date of vesting under the plan: The policy will automatically stop accepting contributions in the Life Assured on the policy anniversary that falls on or after the completion of 18 years of age, and will be regarded as an agreement between the Corporation and the Life Assured upon such vesting.

Options available

Options available

The below-listed options are available under the plan:

Rider Benefits: The insured may purchase LIC's Accident Benefit Rider under this plan at any time during the policy term of the base plan, as long as the leftover policy term of the base plan shall be 5 years. This rider's benefit coverage will be accessible throughout the insurance term. If this rider is selected, the Accident Benefit Sum Assured will be paid in a lump sum in the event of the accidental death of the policyholder.

Settlement option for maturity benefit: Under an in-force and paid-up policy, the Settlement Option allows you to receive Maturity Benefit in instalments over a 5-, 10-, or 15-year term rather than a lump-sum payment. This alternative can be used by the policyholder during the Life Assured's minority 4 or by Life Assured's aged 18 and up for all or part of the maturity proceeds payable under the policy. The amount chosen by the Policyholder/Life Assured (i.e. Net Claim Amount) can be in either absolute or percentage of the overall claim amounts payable. The installments should be paid in advance at annual, half-yearly, quarterly, or monthly intervals, as preferred, subject to the following minimum installment amounts for various means of payment:

Mode of Instalment paymentMinimum instalment amount
Monthly Rs 5000
Quarterly Rs 15,000
Half-Yearly Rs 25,000
Yearly Rs 50,000

Option to take Death Benefit in installments: Under an in-force and paid-up policy, this is an option to receive death benefit in instalments over a selected term of 5, 10, or 15 years rather than a lump sum payment. This alternative can be used by the policyholder while the Life Assured is still a minor, or by the Life Assured who is 18 years or older, during his or her existence, for all or part of the death benefits due under the policy. The amount chosen by the Policyholder/Life Assured (i.e. Net Claim Amount) can be in either absolute or percentage based on the total claim amounts payable. The instalments will be paid in advance at yearly, half-yearly, quarterly, or monthly intervals, as preferred, with a minimum instalment amount equal to the maturity benefit settlement option.

Surrender rule

Surrender rule

If premiums have been paid for at least two years, the policy can be relinquished at any time. The Corporation will pay the Surrender Value, which is higher than the Guaranteed Surrender Value, and the Special Surrender Value when the policy is surrendered. The Special Surrender Value is subject to change and may be decided by the Corporation at any time with IRDAI's prior permission. The Guaranteed Surrender Value payable throughout the insurance term is calculated by multiplying the overall premiums paid (excluding additional premiums, taxes, and rider premiums, if any) by the Guaranteed Surrender Value factor relevant to overall premiums made under the policy.

Loan option and free-look period

Loan option and free-look period

Loans are available during the policy's term if the policy has a surrender value and are subject to the terms and conditions set forth by LIC. At regular periods, the interest rate to be charged for the policy loan and as applicable for the full term of the loan should be calculated. The appropriate interest rate will be determined by the Corporation using the IRDAI-approved procedure. The maximum loan as a percentage of surrender value shall be for inforce policies up to 90% and for paid-up policies up to 80%. At the time of exit, any unpaid debt, including interest, will be recovered from the claim proceeds.

If the insured person is dissatisfied with the policy's "Terms and Conditions," the individual may surrender the policy within 15 days of receiving the policy bond, expressing his or her complaints. Upon subtracting the appropriate risk premium (for base plan and rider, if any) for the term of cover and stamp duty costs, the Corporation will cancel the policy and refund the amount of premium contributed.

Read more about: lic women investment
Story first published: Friday, September 10, 2021, 15:35 [IST]
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