LIC Flexi Plus ULIP Plan

 LIC has launched ULIP plan called as Flexi Plus in first week of January 2013. LIC’s Flexi Plus is a unit linked assurance plan, which not only provides a lump sum benefit on death but also the maturity benefit irrespective of the survival of the Policyholder. Let’s Review LIC Flexi Plus.

LIC Flexi Plus – Features:

o    Flexibility to choose the policy term.

o    Flexibility to choose the premium paying mode as per your convenience (yearly, half yearly, quarterly, SSS or ECS)

o    Flexibility to choose from 2 fund types (debt and mix) to suit your investment needs

o    Flexibility of partial withdrawals to meet your emergency needs after 5 years

o    Sum Assured is 10 times the annual premium

o    NMG is not allowed. That means Medical is required before this ULIP plan.

o    Maturity Benefits payable irrespective of survival of the Life Assured during the term

o    On Surrender of the policy, Policyholder’s Fund Value is payable.

o    Four free switches allowed during a policy year.

LIC Flexi Plus – Eligibility:

o    Minimum Age at entry-18 years (last birthday)

o    Maximum Age at entry -50 years (nearest birthday)

o    Maximum Maturity Age-60 years (nearest birthday)

o    Policy Term-10 to 20 years.

Premium Details

Mode	Minimum (Rs.)	Maximum (Rs.)
Yearly	15,000	100,000
Half Yearly	10,000	50,000
Quarterly	5,000	25,000
Monthly (ECS)	2,000	8,000

LIC Flexi Plus – Death Benefits

Ø  Immediate lump sum payment equal to Sum Assured shall be paid to the nominee / legal heir.

Ø  An amount equal to sum of all future premiums payable after the date of death shall be credited to the Policyholder’s Fund

Ø  On the Date of Maturity an amount equal to the Policyholder’s Fund Value will be given to the nominee/ legal heir.

LIC Flexi Plus – Maturity Benefits

Ø  On Life Assured surviving the date of maturity, an amount equal to Policyholder’s Fund Value is payable.

LIC Flexi Plus – Investment Fund Selection

LIC Flexi Plus has two options for fund for investment selection

1.      Debt Fund - This fund purely invests in debt funds and is suited for low risk profile.

2.      Mixed Fund – This would have maximum of 25% equity investment and rest in debt instruments. This fund selection will bring more reward.

Fund Details

Fund Type	Investment in Government/ Corporate Debt	Short Term Investments Option	Investment in Listed Equity Shares	Risk/ Return
Debt Fund	Not less than 60%	Not more than 40 %	Nil	Low Risk
Mixed Fund	Not less than 45%	Not more than 40%	Not less than 15% and not more than 25%	Steady income –Lower to Medium Risk

Expected Return

The Debt Fund Option above is similar to Debt Gilt and Long Term Mutual Fund. If we look at 10 years return of funds from this category. Return value varies from 3% to 8%. One can expect similar return from LIC Flexi Plus – Debt Fund.

Mixed Fund option is similar to Hybrid Debt oriented conservative Mutual Fund. Past performance of this fund varies from 7% to 14%.