About Bima Diamond Plan
LIC’s Bima Diamond plan offers a combination of protection and savings. In case of unfortunate death of the policyholder, this plan provides financial support for the family not only during the policy term but also beyond the policy term during the Extended Cover Period (equal to half of the policy term and beginning from the date of maturity). Periodic payments shall also be made on survival of the policyholder at specified durations during the policy term.
In addition, this plan also takes care of liquidity needs through its Auto Cover as well as loan facility.
It is a close ended plan which shall be available for sale upto 31st August, 2017, coinciding with the Diamond Jubilee Year of the Corporation.
Benefits of Bima Diamond
1. Death Benefit (applicable for policies where all the due premiums have been paid):
– In case of death of the life assured before the date of maturity: During first five years: “Sum Assured on Death” shall be payable. After completion of five policy years but before the date of maturity: “Sum Assured on Death” and Loyalty Addition, if any, shall be payable.
Where “Sum Assured on Death” is defined as the highest of –
• 10 times of annualised premium; or
• Sum Assured on Maturity as defined in 1. c) below; or
• Absolute amount assured to be paid on death, i.e. Basic Sum Assured.The death benefit
shall not be less than 105% of all the premiums paid as on date of death.
Premiums referred above shall not include any taxes, extra amount chargeable under the
policy due to underwriting decision and rider premiums, if any.
– In case of death during the Extended Cover Period: An amount equal to 50% of Basic Sum Assured shall be payable.
2. Survival Benefit:
On the life assured surviving to the end of each of the specified durations during the policy term, provided all due premiums have been paid, a fixed percentage of Basic Sum Assured shall be payable. The fixed percentage for various policy terms is as below:
For policy term 16 years:
15% of Basic Sum Assured at the end of each of 4th , 8th and 12th policy year.
For policy term 20 years:
15% of Basic Sum Assured at the end of each of 4th, 8th, 12th and 16th policy year.
For policy term 24 years:
12% of Basic Sum Assured at the end of each of 4th, 8th, 12th, 16th and 20th policy year.
2. Maturity Benefit: On the life assured surviving to the end of the policy term, provided all due premiums have been paid, “Sum Assured on Maturity” along with Loyalty Addition, if any, shall be payable. Where “Sum Assured on Maturity” is as under:
– 55% of Basic Sum Assured for policy term 16 years
– 40% of Basic Sum Assured for policy terms 20 and 24 years
3. Loyalty Addition:
Provided all the due premiums have been paid till date of death or maturity, whichever is earlier, depending upon the Corporation’s experience, the policy shall participate in profits in the form of Loyalty Addition. The Loyalty Addition, if any, shall be payable, on death after completion of 5th policy year but within the policy term or on maturity, at such rate and on such terms as may be declared by the Corporation.
In addition, Loyalty Addition, if any, shall also be considered in Special Surrender Value
calculation on surrender of policy during the policy term provided all the premiums for the entire premium paying term have been paid.
Main Features of Bima Diamond
Payment of Premiums: Premiums can be paid regularly at yearly, half-yearly, quarterly or monthly intervals (monthly premiums through ECS only) or through salary deductions during the Premium Paying Term of the policy.
However, a grace period of one month but not less than 30 days will be allowed for payment of yearly or half-yearly or quarterly premiums and 15 days for monthly premiums.
Revival: If premiums are not paid by the end of the grace period then the policy will lapse. A lapsed policy can be revived within a period of 2 consecutive years from the date of first unpaid premium by paying all the arrears of premium together with interest (compounding half-yearly) at such rate as fixed by the Corporation at the time of the payment, subject to submission of satisfactory evidence of continued insurability.
The Corporation reserves the right to accept at original terms, accept at revised terms or decline the revival of a discontinued policy. The revival of discontinued policy shall take effect only after the same is approved by the Corporation and is specifically communicated in writing to the Policyholder.
Revival of rider, if opted for, will be considered along with revival of the Base Policy, and not in isolation.
The Revival Period and Auto Cover Period (as mentioned in para 8 below) shall run concurrently i.e. Auto Cover period does not extend period of revival.
Paid-up: If less than three years’ premiums have been paid and any subsequent premium be not duly paid, all the benefits under the policy shall cease after the expiry of grace period and nothing shall be payable.
If at least three full years’ premiums have been paid and any subsequent premiums be not duly paid, the policy shall not be void but shall continue as a paid-up policy. However, under such policies Auto Cover Period as mentioned below shall be applicable.
Surrender Value: The policy can be surrendered at any time provided premiums have been paid for atleast three consecutive years. On surrender of the policy, the Corporation shall pay the Surrender Value equal to higher of Guaranteed Surrender Value and Special Surrender Value.
The Special Surrender Value is reviewable and shall be determined by the Corporation from time to time subject to prior approval of IRDAI.
The Guaranteed Surrender Value payable during the policy term shall be equal to the total premiums paid multiplied by the Guaranteed Surrender Value factor applicable to total premiums paid, less any survival benefits already paid under the policy.
Taxes: Statutory Taxes, if any, imposed on such insurance plans by the Govt. of India or any other constitutional Tax Authority of India shall be as per the Tax laws and the rate of tax as applicable from time to time.
The amount of Service Tax payable as per the prevailing rates shall be payable by the policyholder on premiums payable under the policy, which shall be collected separately over and above in addition to the premiums payable by the policyholder. The amount of tax paid shall not be considered for the calculation of benefits payable under the plan.