With LIC’s New Money Back (Plan 721) (25 Years), find peace of mind. Your resource for estimating expenses and returns under LIC’s 25-year money-back guarantee is the Premium and Maturity Calculator. Estimate your premium costs, the date of your survival payouts, and the maturity you can anticipate at the conclusion of the policy term using the calculator. This tool ensures that your financial objectives are in line with LIC’s benefit structure by assisting you in making clear plans.
LIC New Money Back (Plan 721) – (25 Years)
Plan No. 721 (UIN: 512N278V03)
Why Choose LIC’s New Money Back (Plan 721) (25 Years)?
Key Benefits & Features
Highlights from the LIC Customer Information Sheet (CIS) for MB-25 are as follows:
| Feature | Details |
|---|---|
| Policy Type | Non-linked, participating (i.e. with bonuses) |
| Policy Term | 25 years |
| Death Benefit | If the policy is in effect, the “Sum Assured on Death” plus any vested bonuses plus any last extra bonuses are paid out in the event of death before maturity. At least 105% of the total amount of premiums paid goes towards the death benefit. |
| Sum Assured on Death | Higher of 125% of Basic Sum Assured or 7 × annualized premium (whichever is higher) |
| Survival Benefits | 15% of the Basic Sum Assured is payable at the end of policy years 5, 10, 15, and 20 (if the policy is alive) |
| Maturity Benefit | On survival to 25 years: “Sum Assured on Maturity” + vested bonuses + final additional bonus. Here, Sum Assured on Maturity = 40% of Basic Sum Assured |
| Surrender | can give up after the first year (provided the premium is paid for a full year). Guaranteed Surrender Value (GSV) after two complete years; if qualified, “Special Surrender Value” may be applied after the first year. |
| Loan Facility | After first policy year, if one full year’s premium is paid, a policy loan may be availed per terms |
| Grace Period | 30 days for yearly / half-yearly / quarterly modes; 15 days for monthly mode |
| Free Look | 30 days from receipt of policy to review and return (if you change your mind) |
| Claims TAT | Death claims not requiring investigations: 15 days; where investigations required: 45 days |
Over the course of the policy’s lifetime, these design elements guarantee that it will provide both protection (through the death benefit) and recurring cash flows (through the survival benefit).
Real-World Examples & Sample Calculations
Here are some hypothetical but illustrative examples of how premium and maturity might appear under this plan. These values are intended to aid in your understanding of the mechanics but are not guaranteed.
Example 1: Basic Sum Assured = ₹1,00,000
- Suppose you choose a Basic Sum Assured of ₹1,00,000.
- Over 25 years, assume the annualized premium is ₹8,000 (just as an illustrative figure).
- Survival benefits:
- At year 5: 15% of ₹1,00,000 = ₹15,000
- Year 10: ₹15,000
- Year 15: ₹15,000
- Year 20: ₹15,000
- Maturity benefit:
- Sum Assured on Maturity = 40% of ₹1,00,000 = ₹40,000
- Plus accrued bonuses & final additional bonus (say for illustration this is ₹20,000)
- Total maturity = ₹60,000
- Total you would have collected (survival + maturity) = ₹60,000 + (4 × ₹15,000) = ₹1,20,000 (plus bonuses etc.)
- Death benefit (if death occurs earlier): Higher of 125% of SA (₹1,25,000) or 7 × premium (₹56,000) → ₹1,25,000 plus vested bonuses
Example 2: Higher Sum Assured = ₹5,00,000
- Basic Sum Assured: ₹5,00,000
- Suppose annual premium = ₹40,000
- Survival in years 5,10,15,20: ₹75,000 each (i.e. 15% of ₹5,00,000)
- Maturity: 40% of ₹5,00,000 = ₹2,00,000 + bonuses (say ₹1,00,000) = ₹3,00,000
- Total benefit over life: ₹3,00,000 + (4 × ₹75,000) = ₹6,00,000 (plus bonus)
- Death benefit: higher of 125% of SA = ₹6,25,000 or 7 × ₹40,000 = ₹2,80,000 → so ₹6,25,000 + vested bonuses
Your actual premiums and bonuses will be determined by your age, health, LIC’s stated bonus rates, and other underwriting considerations; these figures are merely indicative.
Expert Perspectives & Industry Context
- According to actuarial consultant Dr. Anjali Mehra, “money-back policies continue to appeal to investors seeking periodic liquidity along with life cover.”
- According to industry reports, the Indian life insurance sector reported a weighted average yield for participating plans over extended periods of time of approximately 4-5 percent net of expenses.
- The surrender rate for long-term nonlinked policies has been between 8 and 12% after the first five years, according to IRDAI’s annual report. This underscores the significance of comprehending surrender benefits beforehand.
Before committing, policyholders should model several scenarios (best, moderate, and low bonus), according to industry data and expert insights.
See how your financial planning looks over the next 25 years by using the LIC’s New Money Back (Plan 721) (25 Years) Premium and Maturity Calculator right now.
FAQs
Any individual satisfying LIC’s age, health, and underwriting norms (typical entry ages are defined by LIC; check latest prospectus).
Yes, subject to policy terms and LIC’s approval (you may need to follow their standard procedure).
You have a grace period (30 days for yearly/half-yearly/quarterly; 15 days for monthly). If still unpaid after grace, the policy may lapse or convert to paid-up (if eligible).
You might receive a “Special Surrender Value” following a minimum of one full year’s premium. The Guaranteed Surrender Value becomes available after two complete years. Duration, declared bonuses, and premiums paid all affect the surrender value calculation.
No. Bonuses (simple reversionary and final additional) are based on LIC’s surplus and experience and thus are not guaranteed. Past performance is not a guarantee of future bonus rates.
Yes, as per policy conditions, you may opt to receive the death benefit in installments over 5, 10, or 15 years, rather than lump sum.
For death claims not requiring further investigation: 15 days. If investigation is required: up to 45 days.
In case of suicide within 12 months from policy start (or revival), the nominee gets 80% of premiums paid (excluding certain extras) or surrender value, whichever is higher.