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Hi

How to calculate Mortality charges for insurance policy (for LIC)

Where to find the LIC mortality rate table and how to calculate with specific plan (like JEEVAN ANAND for 30Yrs Male)

Thanks in Advance

Nagarajan S

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9 Answers

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1 Manish Chauhan March 23, 2012 at 1:53 pm

Nagarajan

Mortality charges is something which you cant calculate like this ,its a very long process . It involes hell lot of caluclations and data. Acturies are hired by Insurance companies to do that. Its not something which can be communicated and taught like this simply .

Why do you need it at first place ?

Manish

Reply

2 Nagarajan March 23, 2012 at 2:11 pm

HI Manish

Thanks for your reply.

AS per my understanding, all the statements related to returns (say LIC’s benefit illustrations showing 6% and 10% return) meant by premium amount – mortality charges.

Say example, my annual premium is 12,000/- there are some mortality charges (take Rs1000 for example). So my return will be calculated for Rs. 11,000 /- only.

Am I correct Manish ?

For this calculation purpose only I want to know the mortality charges. (I am not talking about ULIPS)

Please correct me if I am wrong.

Thanks
Nagarajan S

Reply

3 Manish Chauhan March 23, 2012 at 4:05 pm

yes you are true , from your premium , first the mortality charges are deducted, and then you get the return on that amount. BUt mortality rate calculation is what you asked for and that is complex .

What exactly are you trying to do ? May be there is a simpler way to do that ?

Manish

Reply

4 Nagarajan March 23, 2012 at 4:47 pm

Thanks Manish for your prompt reply :)

I am going to calculate IIR for Jeevan Anand policy for my friend. To show how much he is really going to receive in end of the premium.

I thought using full premium for calculating IIR will lead wrong output (higher than actual).

That’s what I am asking how much mortality charges will be deducted.

Detail – Male, 33 Years, Jeevan Anand, 20 Years and annual premium is 12,000.

Manish, could you provide the approximate amount if possible based on above details.

Once again …. Thanks ….

Nagarajan S

Reply

5 ashal jauhari March 23, 2012 at 6:20 pm

Dear Nagarajan, enough has been discussed for Jeevan anand policy on various forums (including this one). Just google the same & you ‘ll get all the details. In case your friend is going to purchase Jeevan Anand in any case, just a small suggestion, please ask him to go for 21Y plan instead of 20Y as the bonus rate is a bit higher there. Personally I’m against this Jeevan Anand policy.

A better comparison ‘ll be a combo of Anmol Jeevan (the term plan of LIC) + a simple product like PPF pitched against this Jeevan Anand policy.

Thanks

Ashal

Reply

6 Nagarajan March 23, 2012 at 6:30 pm

Hi Ashal

Thank for your suggestion ….

I agree what you are saying. But I googled it and not able to find the information related to Mortality (not talking about Jeevan Anand).

Just I want to know the mortality charges part (simply to say for my knowledge to explain them to avoid this kind of policy)

Anyhow thanks for your reply.

Nagarajan S

Reply

7 ashal jauhari March 23, 2012 at 6:41 pm

Dear Nagarajan, strange but true, IRDA rules specifies that mort. charges are to be shown compulsorily in a ULIP but in case of Endowment plans, no such compulsion is there. that’s the single reason that mort. charges for endowment plans are not in public domain. In case you are curious enough to look for the same, Please contact any Development officer of LIC & he ‘ll help you out for the same.

By the way, while asking for such details, please do not share your real intentions. :) :)

Thanks

Ashal

Reply

8 bharat shah March 23, 2012 at 5:20 pm

can’t you take the equivalent pure term insurance premium of the same insurance company or your other preferred company instead of mortality charge , and the balance a/m would be considered as invested for the period of insurance and find out the cagr of the policy?

Reply

9 Nagarajan March 23, 2012 at 9:02 pm

Dear Ashal, thanks for your suggestions.

But I think nobody will this details or they don’t know exactly.

Thanks for your effort.

Nagarajan S

Reply

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