LIC's New Children's Money Back Plan

Complete Guide to LIC's New Children's Money Back Plan (Plan No. 732)

Introduction

Planning for a child's higher education, professional training, and marriage is one of the most significant responsibilities for any parent or grandparent. As children grow, their financial needs increase rapidly at specific milestone ages. Traditional savings methods often lack the structured timing required to meet these educational expenses, while also failing to provide an adequate safety net in case of unforeseen family tragedies.

For families residing in Bhadra (335501) and nearby areas like Jhansal and Ninal, ensuring a completely secure and predictable financial pathway for your child is absolutely essential. The LIC New Children's Money Back Plan (Plan No. 732) offers a highly structured solution. By providing structured periodic payouts as per policy terms exactly when your child reaches critical young adult ages, it eliminates financial guesswork. If you are seeking professional LIC policy services in Bhadra to structure a policy that aligns with your child's future milestones, understanding the precise rules, benefits, and protective features of this plan is your best starting point.

Plan Overview

The LIC New Children's Money Back Plan is an Individual, Non-Linked, Par, Life Savings plan. It is specifically built for children, meaning the policy can only be purchased by a parent or grandparent for a child between the ages of 0 and 12 years.

The policy term is mathematically fixed to end when the child reaches exactly 25 years of age. Therefore, the policy term is calculated as 25 minus the child's age at entry. For example, if a policy is purchased for a 5-year-old child, the policy term will be exactly 20 years. The premium paying term is identical to the policy term, meaning you pay premiums throughout the duration of the policy until the child turns 25.

Key Features

Before exploring the deep financial mechanics, here are the core features of the plan:

• Milestone Payouts: Delivers survival benefits precisely at ages 18, 20, and 22.
• Complete Flexibility: Options to defer survival benefits if funds are not immediately needed.
• Instalment Options: The ability to receive maturity or death benefits in structured instalments rather than a lump sum.
• Financial Protection: Robust life cover on the life of the child during the policy term.
• Premium Waiver: An optional rider that waives all future premiums if the purchasing parent passes away.
• Liquidity Support: A loan facility is available to handle emergency family needs.

Benefits Breakdown

The financial support provided by this money back plan is divided into three major categories. These benefits are payable only if the policy remains in-force and premiums are duly paid.

A. Death Benefit

The death benefit provides financial support in the tragic event of the child's passing during the policy term. However, the exact payout depends strictly on the risk commencement rules.

If death occurs BEFORE the date of commencement of risk:
The death benefit payable shall simply be the return of the Total Premiums paid. This return strictly excludes any taxes, extra premiums, and rider premiums. No interest is payable on this refunded amount.

If death occurs AFTER the date of commencement of risk:
The death benefit payable shall be the "Sum Assured on Death" along with vested Simple Reversionary Bonuses and Final Additional Bonus, if any. The "Sum Assured on Death" is officially defined as the higher of:

• The Basic Sum Assured.
• 7 times the annualized premium.

Furthermore, this death benefit is subject to a strict minimum guarantee: it shall not be less than 105% of the total premiums paid up to the date of death.

C. Maturity Benefit

On the Life Assured surviving the full policy term (which coincides with reaching age 25), the maturity benefit becomes payable. The "Sum Assured on Maturity" is equal to 40% of the Basic Sum Assured. This amount is paid along with all vested Simple Reversionary Bonuses and any Final Additional Bonus.

Bonus Explanation

This policy is eligible to participate in the Corporation's valuation experience. Provided the policy is in-force, it is entitled to receive Simple Reversionary Bonuses declared annually. Once declared, bonuses become part of the policy benefits. A Final Additional Bonus may also be declared in the year the policy results in a claim by death or maturity.

It is critically important to understand that bonuses are NOT guaranteed. They are declared based purely on the operational experience of the Corporation. If premiums are not duly paid, the policy immediately ceases to participate in future bonus declarations.

Eligibility and Premium Rules

To ensure your child qualifies, note the following exact parameters:

• Minimum Age at Entry: 0 years (last birthday).
• Maximum Age at Entry: 12 years (last birthday).
• Minimum and Maximum Maturity Age: Exactly 25 years (last birthday).
• Minimum Basic Sum Assured: Rs. 2,00,000.
• Maximum Basic Sum Assured: No Limit (must be in specific multiples depending on the range).

For families living in surrounding regions like Biran or Malkhera, keeping policies active is crucial. Premiums can be paid yearly, half-yearly, quarterly, or monthly. A grace period of 30 days applies to yearly, half-yearly, and quarterly modes, while a 15-day grace period applies to monthly payments. If you require specialized LIC policy support in Bhadra regarding premium payment structures or reviving a lapsed plan, local advisors can assist you based on the official guidelines.

Loan, Surrender, and Paid-up Value

Emergencies require flexibility, and the plan provides specific rules for liquidity:

• Loan Facility: A loan can be availed under the policy after the completion of the first policy year, provided at least one full year's premium has been paid. For in-force policies, the maximum loan is up to 50% of the surrender value (before two years' premiums are paid) and up to 75% (after two years' premiums are paid).
• Surrender Value: The policy can be surrendered after the completion of the first policy year, assuming one full year's premium is paid. It acquires a formal Guaranteed Surrender Value only after the payment of at least two full years' premiums.
• Paid-Up Policy: If at least one full year's premium has been paid and subsequent payments stop, the policy does not become completely void. It continues as a paid-up policy with a reduced Death Paid-up Sum Assured and Maturity Paid-up Sum Assured. Under a paid-up policy, future survival benefits are not payable separately. Furthermore, paid-up policies do not participate in future bonus declarations.

Deferment and Settlement Options

Option to Defer Survival Benefits:
If the family does not need the funds at age 18, 20, or 22, the policyholder can choose to defer the survival benefit. The Corporation will pay an increased Survival Benefit based on specific calculation factors when the deferred amount is eventually claimed. This must be intimated in writing six months before the due date.

Settlement Option (Instalment Payouts):
Instead of a lump sum, the policyholder can opt to receive the Maturity Benefit or Death Benefit in monthly, quarterly, half-yearly, or yearly instalments over 5, 10, or 15 years. The interest rate used for these instalments is officially linked to the 10-year semi-annual G-Sec yield minus 2%.

Premium Waiver Benefit Rider

This is an optional but highly recommended rider for any child plan. LIC's Premium Waiver Benefit Rider can be opted for on the life of the Proposer (the parent). If this rider is active and the Proposer unfortunately dies during the rider term, all future base policy premiums falling due after the date of death are completely waived. This ensures the child's financial milestones are protected even if the earning parent passes away.

Taxes

Statutory taxes imposed by the Government are applicable and are collected separately over and above the regular premium. Taxes paid are not considered in the calculation of any benefits payable under the plan.

Who Should Buy This Plan

The LIC New Children's Money Back Plan is ideal for:

• Parents of young children (aged 0-12) who want a rigid, failure-proof savings structure.
• Long-term planners looking for funds exactly when college, higher education, and marriage expenses typically arise (ages 18 to 25).
• Families wanting to ensure that their child's educational corpus continues to grow securely, backed by life protection and premium waiver safety nets.

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Conclusion and Next Steps

Securing your child's financial future requires a plan that delivers funds exactly when educational milestones arrive. The LIC New Children's Money Back Plan provides structured payouts at ages 18, 20, and 22, culminating in a solid maturity payout at age 25. For residents in the Bhadra region, including those in nearby communities like Mahrana and Malkhera, taking timely action ensures your child's dreams are never compromised by financial shortfalls.

This plan combines periodic payouts with long-term protection, but all benefits are strictly governed by policy terms and conditions. If you need assistance structuring the Premium Waiver Rider or require professional LIC claim assistance, consulting an authorized advisor guarantees your application follows official standards perfectly. Start building your child's milestone fund today. All benefits are subject to policy conditions and LIC rules as applicable.

Frequently Asked Questions (FAQ)