LIC's New Money Back Plan 25 Years (No. 721)

Complete Guide to LIC's New Money Back Plan 25 Years (Plan No. 721)

Managing long-term financial goals while ensuring adequate cash flow for intermediate needs is a common challenge for families in Bhadra (335501). Whether you are planning for higher education expenses, setting up a fund for business milestones, or simply building a safety net, you require a solution that balances disciplined savings with periodic liquidity. The LIC New Money Back Plan 25 Years (Plan No. 721) is uniquely designed to address this exact requirement. By offering scheduled payouts while keeping your primary life cover intact, it provides financial peace of mind. If you are looking for trusted LIC policy assistance in Bhadra, understanding the exact rules, structure, and benefits of this money back plan is the first step toward securing your family's financial future.

Plan Overview

LIC's New Money Back Plan-25 years is officially classified as a Par, Non-Linked, Life, Individual Savings plan. The policy term for this plan is strictly 25 years. However, policyholders are not required to pay premiums for the entire duration of the cover. The premium paying term is fixed at 20 years. This advantageous structure allows you to build a substantial corpus over two decades, stop paying premiums, and still enjoy life cover and final payouts for another five years as per policy terms.

Key Features

To appreciate the utility of this plan, one must look at its core features:

• Protection and Savings: The plan provides financial support against death throughout the entire 25-year term, alongside structured savings for the surviving policyholder.
• Survival Payouts: Survival benefits are payable at specified policy durations, provided all due premiums have been paid.
• Bonus Participation: Being a participating plan, the policy is eligible to share in the profits of the Corporation.
• Loan Facility: It takes care of sudden financial emergencies through an accessible loan facility.
• Rider Add-ons: Policyholders have the option to enhance their base coverage by opting for additional Rider Benefits.
• Flexible Payouts: There is an option to receive the Death Benefit and Maturity Benefit in instalments instead of a lump sum.

Benefits Breakdown

The financial support provided by this plan is divided into three primary categories. These benefits are payable only if the policy remains in-force.

A. Death Benefit

If the Life Assured passes away during the 25-year policy term while the policy is in-force, a comprehensive Death Benefit is payable to the nominee. The Death Benefit is defined as the "Sum Assured on Death" along with vested Simple Reversionary Bonuses and Final Additional Bonus, if any.

The "Sum Assured on Death" is strictly defined as the higher of:

• 125% of the Basic Sum Assured.
• 7 times the annualized premium.

Furthermore, the policy mandates a minimum protection rule: this death benefit shall not be less than 105% of the total premiums paid up to the date of death.

B. Survival Benefit

To provide liquidity, the plan offers scheduled survival benefits. On the Life Assured surviving to the end of specified durations, provided all due premiums have been paid, 15% of the Basic Sum Assured shall be payable at the end of each of the 5th, 10th, 15th, and 20th policy year.

Eligibility Conditions

To purchase this plan, the following eligibility rules apply:

• Minimum Age at Entry: 13 years (completed).
• Maximum Age at Entry: 45 years (nearer birthday).
• Maximum Maturity Age: 70 years (nearer birthday).
• Minimum Basic Sum Assured: Rs. 2,00,000.
• Maximum Basic Sum Assured: There is no upper limit, but the chosen amount must be in multiples of Rs. 25,000.

Loan, Surrender, and Paid-up Rules

Managing policy rules accurately is important for residents in areas like Badbiran, Gogameri, and Nethrana. Whether you live in the heart of Bhadra or commute from Gogameri or Nethrana, knowing your policy's liquidity options helps in emergencies. If you encounter changes in your financial situation and require expert LIC policy support, here are the official operational guidelines:

• Loan Facility: A loan can be availed under the policy after the completion of the first policy year, provided one full year's premium has been paid. The maximum loan allowed for in-force policies is up to 50% of the surrender value (before payment of two full years' premiums) and up to 75% (after payment of two full years' premiums). For paid-up policies, it is up to 40% and 65% respectively.
• Surrender Value: The policy can be surrendered after the completion of the first policy year provided one full year's premium has been paid. However, it only acquires a Guaranteed Surrender Value 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 premiums are not paid, the policy does not become void but continues as a paid-up policy till the end of the term. The Death Paid-up Sum Assured and Maturity Paid-up Sum Assured are reduced proportionately based on the ratio of premiums paid to the total premiums originally payable.

Settlement Option for Instalment Payouts

The plan offers a unique Settlement Option to receive the Maturity Benefit or Death Benefit in instalments over a chosen period of 5, 10, or 15 years instead of a traditional lump sum. The minimum instalment amount is structured as follows: Rs. 5,000 for monthly payments, Rs. 15,000 for quarterly, Rs. 25,000 for half-yearly, and Rs. 50,000 for yearly modes. The interest rate used to calculate these instalments is linked to the 10-year semi-annual G-Sec yield minus 2%.

Optional Rider Benefits

Policyholders can enhance their coverage by attaching optional riders by paying an additional premium:

• LIC's Accidental Death and Disability Benefit Rider: Provides a lump sum upon accidental death. In case of accidental disability, the sum assured is paid in monthly instalments over 10 years, and future premiums are waived.
• LIC's Accident Benefit Rider: Provides a lump sum strictly upon accidental death during the premium paying term.
• LIC's New Term Assurance Rider: Provides an extra amount equal to the Term Rider Sum Assured on death during the policy term.

Who Should Buy This Plan

The LIC New Money Back Plan 25 Years is ideally suited for specific profiles:

• Long-term Planners: Individuals looking to systematically build a financial corpus over a full 25-year period while enjoying extended life cover.
• People Needing Periodic Payouts: Families who have predictable financial milestones every 5 years and require guaranteed liquidity without having to break their life insurance cover or take loans.
• Family Protection Seekers: Those who want a higher base death benefit (125% of the Basic Sum Assured) to ensure their dependents have a stronger safety net in case of an emergency.

---

Conclusion and Next Steps

The LIC New Money Back Plan 25 Years offers a highly structured balance of long-term life cover and scheduled survival payouts as per policy terms. For families in Bhadra, as well as surrounding communities like Ramgarh and Lalana, this plan ensures you do not have to compromise between long-term savings and short-term liquidity. This plan combines periodic payouts with long-term protection, but all benefits are strictly governed by policy terms and conditions. To properly structure your policy, understand the premium paying terms, or for reliable LIC claim assistance, it is always recommended to consult an authorized advisor who can guide you strictly through the official guidelines. Secure your family's milestones with careful, fact-based planning today.

Frequently Asked Questions (FAQ)