How LIC policies works ? Bonus, Premiums, Maturity, Loan !

POSTED BY Jagoinvestor ON August 30, 2011 COMMENTS (1,197)

There are so many LIC policies with different names ? For example – LIC Jeevan Saral , Jeevan Anand , Jeevan Tarang and many more LIC policies. So almost every person in India holds some LIC policies, but majority of them do not know how these LIC policies works ?

How does LIC policy work?

How LIC Policies Work ?

Most of the investors just take things for granted and keep dragging the policies assuming it would be the best thing in their financial life. In this article I will show you how Life Insurance Corporation (LIC) policies work and talk about few aspects like LIC bonus, LIC premiums and different other aspects which will help you in understanding how these policies work.

Moneyback Plans or Non-Moneyback Plans

A lot of LIC policies pay you on a periodic basis like at the end of 4th, 8th and 12th year, and then finally at the end of the maturity period. These policies are Money back policies, the example can be LIC Jeevan Surabhi or LIC Komal Jeevan. A lot people get attracted to these moneyback plans because they get money “many” times in between and it looks attractive to them, but the premiums are generally higher for these policies.

Then there are LIC policies which do not pay you back periodically but only pays you at the end of the maturity period. They are generally termed as normal Endowment plans. Some examples are Jeevan Anand and Jeevan Tarang

LIC Bonus & Additions to your Policy

The biggest confusion I see is generally in Bonus by LIC. One thing which investors in these policies don’t know and don’t care for to find out is that there are different kinds of bonuses in LIC policies and they are calculated differently. Let’s see them one by one.

1. Simple Reversionary Bonuses

Generally when we say “Bonus”, it is this “Simple Reversionary Bonus”, which is declared per thousand of the Sum Assured on annual basis at the end of each financial year. This bonus is declared today, but is paid at the end of maturity period only or on death, whichever is earlier. So for example if you hold a policy of Rs 10,00,000 Sum assured and the bonus for this year is Rs 60 per thousand sum assured, then your bonus amount is Rs 60,000 for this year, but you will only get it at maturity (after many many years) or on death, but by then it’s worth would be much lesser than today (this 60,000 today and 60,000 after 20 yrs).

A very important point to note here is that, if you surrender the policy, you don’t get the actual accrued bonus because it’s the future value, you will only get its reduced amount in today’s term and its very less. Also note that you are eligible to get reduced Accrued Bonus only if your policy has completed 5 premium paying terms. (This thread on our forum discusses Jeevan Anand in good detail)

2) Final Additional Bonus (FAB)

There is another kind of bonus in LIC which is generally called as “FAB” or Final Additional Bonus and it’s paid to those policies which are of a longer duration and has run for more than 15 yrs (The premiums are paid for all 15 yrs). This is generally a token of appreciation for being with the policy for long duration. The FAB is generally not paid for policies which have “Guaranteed Additions” (explained below). Here is an indicative list of FAB.

Final Addition Bonus FAB LIC

3. Loyalty Additions

This is again a bonus which is declared for being loyal to the LIC and completing a longer tenure. Generally it’s declared at the end of the policy, but for some policies it might be applicable after completion of 5 or 10 yrs. For example – In Jeevan Saral, the policy holders will earn such additions after a minimum of ten policy years have been completed.  This is usually an amount declared per thousand of sum assured depending on the corporation’s performance. Loyalty additions are totally non-guaranteed.

4. Guaranteed Additions

For a lot of LIC policies there is a term mentioned like “Guaranteed Additions”. These are assured sums which are given to policyholders for a specific period at start or end of some event along with the sum assured at the end of the term. Like for example, , Jeevan Shree-1 policy provides for the Guaranteed Additions at the rate of Rs. 50/- per thousand Sum Assured for each completed year for first five years of the policy. The Guaranteed Additions are payable along with the Basic Sum Assured at the time of claim.

Surrender Value

Most of the people who buy any Traditional Policies from LIC or any pvt companies’ don’t think a bit about terms and conditions on exiting the policy much before maturity. A general assumption is that they will at least get their paid premiums back with sum interest. I have seen so many cases like that where people are literally shocked to hear that they will get peanuts or nothing from their policy if they choose not to continue the policy. Surrendering of the policy works this way –

You will not get anything back if you stop your policy without paying for 3 years. Almost every traditional policy attains minimum surrender value after the policy has run for 3 yrs.

After 3 yrs, if you surrender your LIC policy, still you will only get a small fraction of your total paid premiums that too excluding first year premiums. So suppose you have a policy which has Sum assured of 10,00,000 for 20 yrs term with Rs 50,000 premium per year. If you have decided to surrender your policy after paying 5 premiums (you paid 2,50,000 in 5 yrs i.e. Rs 50,000 each year), then you will get around 30%-40% of 4 premiums paid (first year premiums are excluded), hence the total would work out to be only Rs 60,000 – Rs 80,000 only + proportionately reduced amount of accrued bonus if any (only because you completed 5 yrs, else you will not get this also).

A very important point to Note : A lot of people do not like to close their LIC policies after paying for 1-2 premiums because they will not get anything back for the 1-2 premiums already paid. They think that they will surrender the policy after completing 3 yrs, so that they will get at least something back. This is total emotional decision and not mathematical, because if you do maths you will see that surrendering the policy after 3 yrs is the worst decision if you have already realised that you should not continue with the policy. For example, if you are paying Rs 10,000 premium per year and completed 2 yrs, you paid Rs 20,000, If you close this policy now, you will lose all money (Rs 20,000), but you can save Rs 10,000 as third premium. If you choose to complete 3 yrs and then surrender, then you have paid Rs 30,000 and you will get back 30% of 2 premiums (first year premium not included), so you get back Rs 7,000 (loss of 23,000 as you paid 30,000 and got back 7,000). Do the math if you completed 1 yr only yourself, its more worst!

Note that surrender value is nothing but your future maturity value reduced to today’s value, so if the maturity value is Rs 10,000 after 20 yrs and if you want it before LIC will pay you the Net present value as per today’s term.

Paid up Policy

A lot of times when you have completed 3 yrs of policy, you might not want to get your money back immediately, in which case you can made your policy paid up (just stop paying premium and it becomes Paid up). When you do this, you can stop paying further premiums but you will get your total premiums paid + accrued bonus any at the end of the maturity period. This might work out better sometimes compared to surrendering if you were going to invest the proceeds in some debt instrument.

What are mortality charges

A lot of agents advertise these policies under the head “Free Insurance Cover“, But all the policies charge premium or charges for providing Insurance cover and it’s called “Mortality Charges”, these are the same charges which are there in Term plans and ULIP’s, but may be in a different way, so nothing is free, some part of premium goes in covering you and rest of it is invested in Debt instruments which can give you assured returns at the end of the maturity.

Loan on LIC Policy

You can also get loans at the time of crisis on your LIC policies, but the maximum loan amount available under the policy is 90% of the Surrender Value of the policy (85% in case of paid up policies) including cash value of bonus. The rate of interest charged on loans is at 9% to be paid half-yearly. Is there any other terms and conditions which you dont understand in your LIC policies ? We can all help you understand it in comments section .

Are you looking for surrendering your LIC Policies ?

By now you must have got a good understanding of your LIC policies and how they work. You can find out the return of your policies using the IRR method taught in this article. If you feel that you want to continue your Policies then well and good. But if you feel that you want to close your policies, do it soon because delaying the decision will cost you a lot in long run. I hope its clear to you how your LIC policy works for you .

1,197 replies on this article “How LIC policies works ? Bonus, Premiums, Maturity, Loan !”

  1. CMishra says:

    Hi Manish,

    I have below 5 LIC policy . I am giving details of current status for each of them.
    Can you please advise me –
    1) which one I should continue with paying premium till maturity ?
    2) Which one I should surrender ?
    3) Which one I should or make as “paid up” ?

    Also please advise for each of the surrenderred or “paid up” policy how much I will get now ?
    Also is this money taxable ?

    Appreciate your quick response . Thanks a lot in advance .
    Policy#1 : The Endowment Assurance Policy (T.No. 14)

    Policy Start date : 25-Jul-1997
    Last Premium Date : 25-Jul-2026
    Policy Maturity Date : 25-Jul-2027
    Polciy Term : 30
    Premium Paying Term : 30
    Premium : Rs 3,057 per anum
    Sum Assured : Rs 1,00,000
    Premium already Paid : Rs 42,798 (=Rs 3,057 * 14 yrs)
    Vested Bonus : Rs 1,10,500 (As of Mar-2017)

    Policy#2 : Policy Name : Jeevan Nidhi (T.No. 169)

    Policy Start date : 23-Jan-2005
    Last Premium Date : 28-Jan-2030
    Policy Maturity Date : 28-Jan-2031
    Polciy Term : 26
    Premium Paying Term : 26
    Premium : Rs 10,154 per anum
    Sum Assured : Rs 2,65,000
    Premium already Paid : Rs 1,32,002 (=Rs 10,154 * 13 yrs)
    Vested Bonus : Rs 79,765 (As of Mar-2017)

    Policy#3 : Policy Name : Jeevan Shree – I (T.No. 162)

    Policy Start date : 23-Jan-2006
    Last Premium Date : 23-Jan-2021
    Policy Maturity Date : 23-Jan-2031
    Polciy Term : 25
    Premium Paying Term : 16
    Premium : Rs 30,535 per anum
    Sum Assured : Rs 6,000,00
    Premium already Paid : Rs 3,66,420 (=Rs 30.535 * 12 yrs)
    Vested Bonus : Rs 1,93,200 (As of Mar-2017)

    Policy#4 : Jeevan Anand (T.No. 149)

    Policy Start date : 28-Dec-2006
    Last Premium Date : 28-Dec-2021
    Policy Maturity Date : 28-Dec-2022
    Polciy Term : 20
    Premium Paying Term : 16
    Premium : Rs 10,563 per anum
    Sum Assured : Rs 1,50,000
    Premium already Paid : Rs 1,16,193 (=Rs 10,563 * 11 yrs)
    Vested Bonus : Rs 65,700 (As of Mar-2017)

    Policy#5 : Child Career (T.No. 184)

    Policy Start date : 13-Aug-2012
    Last Premium Date : 13-Aug-2026
    Policy Maturity Date : 13-Aug-2032
    Polciy Term : 20
    Premium Paying Term : 15
    Premium : Rs 6,677 per anum
    Sum Assured : Rs 1,00,000
    Premium already Paid : Rs 33,485 (=Rs 6,677 * 5 yrs)
    Vested Bonus : Rs 15,700 (As of Mar-2017)

    1. Discontinue all of them. No insurance other than term plan makes sense for most of the people, unless you want the return they will give like 4-6%

  2. Rangaswamy says:

    Hi manish
    In investment view, I’m in your favor.
    BUT, Life Insurance companies never said anyone to investment in life insurance to get better returns on your investments comparing to many other investment options.

    Life ininsurance policy is to secure(in some extent) the insured (the bread winner-income source of family) family members economically, if unfortunately something happened to him/her.

    1.Mr.Chanakya has taken life insurance policy with DAB for his father for sum assured 50L. He has paid 2 premium. If his father dies in third month he will get 50Lsum assured+bonus of any + DAB 50L. Who will give this type of economic security( for self care minds-returns)

    Life insurance benifits in my view:
    2.Tax savings
    3.Minimum returns
    4.Economic Security to nominees
    5.Peace of mind (economically-after insured/you)
    6. No tax on what you will get back (returns)

    2. Mr Manikya buy a car worth Rd.25L and he will take insurance of Rs.15K to get secure from economic loss of damage to the car if it take place. If in 5th year accident take place, and some part get damage.But insurance companies will pay some percentage of some parts,not for all (fibre parts will be excluded in insurance), sometimes no nothing. If he had not premium to insurance companies, it would have been repaired/replaced out of that. If nothing happens,everything is going well, your premium will be in some HUNDI. For this no returns, no tax savings,less reimbursement than what you have paid, are you happy!!!

    3.Mr. Kumar have invested 10L in Deposits/shares. He will get some thing

    In this case
    1. No Tax savings on investment
    2. Tax on returns
    3. If it is share market if you are in loss you have to imagine yourselves 🙁

    1. Select the good plan which is suitable to you
    2. People highly concerned about things than their life and family members


    1. Hi Rangaswamy

      Thanks for your sharing your valuable comment on this topic. Please keep sharing your views in future also


      1. Sanjiv says:

        I like rangaswamy view lic policies are not to get rich.

        1. Jagoinvestor Admin says:

          Thanks for your comment Sanjiv .. Please keep sharing your views like this..


  3. gopi says:

    Hi Manish, Is it possible to know how much bonus added to my LIC policy? How?

    1. Just make your LIC login on their website , it will show details. In worst case, file a RTI

  4. Ritesh says:

    I have jeevan anand (T No 149) commenced on 28-8-2003, annual premium 10486, I have paid all within time till date, its showing policy term 73 (premium payment term 21), what does this mean, and what u advice to me for this policy, should I continue paying, should I make it paid up policy or should I remove all money right now from policy
    Can u also calculate how much money I will get if I remove all money now only.

    1. just stop it. No other advice

  5. Praveen says:

    Hi Manish,
    in your example of Simple Reversionary Bonuses, you’ve mentioned 60,000Rs for that particular year. if policy term is 20 years for example, then what amount someone gets at maturity ?

    Premium paid (for 20 years) + Bonus (for each 20 years) + other bonus (if any)
    Bonus (for each 20 years) + other bonus (if any)

    1. Its Premium paid (for 20 years) + Bonus (for each 20 years) + other bonus (if any)

  6. Raj says:

    hi manish

    is vested bonus is one in the same as accured bonus

  7. Murugesan says:

    Your comment on ROI for LIC policy or other is exactly correct

  8. Atul says:

    HI –

    I have policies like Jeevan Chaya, Endowment Policies, Jivan Mitra, etc from 2004. They have started showing Vested Bonus as well. Annual premium is Rs 20000. Is it sensible to surrender these policies? How about stopping premium payment. I can now understand that the policy term is 34 yrs…. and I am away 22 yrs for maturity 🙁



    1. Its better to stop premiums and make it a paid up policy !

  9. AchyuthKumar says:

    Dear Friends,
    Investing in any life policy is not a sound investment of your hard and judiciously earned income. The total amount payable by the insurance company of any type of policy will not accounted more than 4% of interest which is equal to the SB rate of interest of the Bank. If we consider the risk element of 1% of the assured amount then it will be within 5% Rate of Interest per year. Most of the agents/companies/Banks speak to you in different manner the Total pay out for any type of policy will not cross 5% rate of interest on your investment. Please check this with the Recurring deposit calculator of any bank or all banking solutions web site. After studying several hundred types of policies and its maturities of different Life Insurance companies I am informing this. You may tale a Term assurance policy of your choice for risk coverage and invest the differential sum in RD accounts of Banks and the maturity proceeds may be either deposited in PPF account of Deposits account. You will get double the amount of your saving through life Insurance companies.If you want to make yourself Fool at a later can invest in Life Insurance companies.

    1. Thanks for your comment AchyuthKumar

  10. Reeshita says:

    Thanks for the clarification. Could you please provide an example of how much one might get for a paid-up policy at the end of the policy term?

    1. I think thats already covered in the article ?

      1. Reeshita says:

        Yes Manish it’s mentioned but I need some help with the apparent figures that one may expect to receive for a paid up policy. I pay Rs. 13010/- per quarter for a 20 year money back policy. Now, if I wish to stop paying the premiums after 5 years but keep it as a paid up policy then after 20 years what is the expected value? The main issue is that how the accrued bonus would be calculated after the premium is stopped and if any money will be received as cashback after 10th and 15th year (not considering the 5th year because till that time premium would be paid hence cashback would be received.)

        1. Hi Reeshita

          That is very specific to the company and how the policy is structured. YOu can get the answer you company only .

  11. sudhir says:

    manish thx a lot frnd .
    ur article must have open the eyes for many common people.
    i was searchg fr such article but ur explaination ws best.

    1. Thanks for your comment sudhir

  12. Avinash Sardesai says:

    Manish, this is very informative article. While most of the policy holders knows about simple revisionary bonus, good to see some table for FAB that I came across for the first time.
    This article gives another interesting message – the benefits offered by LIC are so opaque that it is actually impossible to understand your maturity benefits till you actually receive those, particularly for plans without guaranteed addition, as FAB and loyalty adfition will come into play only at the time of maturity.
    Thanks for putting in so much efforts to clearly demonstrate the benefits through graphical representation.

  13. shyam says:

    I have one ULIP policy from LIC and its ending in January 2017, What should I do to take my money?

    1. Visit LIC office and surrender it

  14. VenkateshBhagavath says:

    Dear Manish,

    I had a LIC policy Bima Nivesh, which got matured this Oct 2015, I see that TDS of 2% is deducted on the maturity amount. I would like to know does this credit of matured amount from policy attracts more tax by considering it to be my income, I mean to say the Sum Assured + compounded G.A. + Loyalty Addition, whatever is credited, will it be taxed again based on my income tax slabs.
    Please help me out if you have any information on this.

    1. Hi Venkatesh

      You can claim the TDS by filing your returns incase there is no tax to be paid from your end

  15. Ritesh says:

    Hello Manish,

    1. I am investing 20652 Rs annually for Jeevan anand policy whose sum assured is 5 Lakhs rupees. Could you please confirm how much money will I get at the end of 25 years maturity?.
    2. Also please suggest any other suitable option for investments other than PPF for retirement planning. Ex: ELSS, RD, Mutual Fund, FD, LIC
    3. How much money a person should invest yearly in PPF, Mutual fund, LIC, RD, FD, ELSS etc and which option is best?
    4. Apart from LIC is this good if we invest Rs 3000 in Birla sun life insurance plans for retirement planning.

    Your quick response will be highly appreciated.

    1. Ritesh

      The simple rule is to invest in Equity based products for long term like Mutual funds or stocks and rest everything for short term ..

  16. Nagarajan says:

    Hi Sir,

    I delayed Jeevan Anand Plan premium payment by 4 days from the actual due date.
    Will this affect my vested bonus(reduction in vested bonus amount accumulated so far)?
    Please note I am paying premium on-time for the past 3 years without delay, only once I delayed by 4 days from actual due date.


    1. It should not create an issue. There is always a grace period !

  17. latha says:

    Sir I am having jeevan saral policy I completed 5years wthh the premium of RS 15000 per year so hw much loan can I get plz

    1. Hi latha

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


  18. Hardik says:

    Hello sir,

    I have Jivan Mitra policy from last 5 years . and my bonus value is 20K.
    SO for coming years my Bonus will be given on My Premium + Credited Bonus ?

    Regards, Hardik patel

    1. Yes, thats correct

      1. Avinash Sardesai says:

        Manish, As per my understanding the Bonus is on sum assured only and not given on any other components. Correct me if this understanding is incorrect.

        1. Avinash Sardesai says:

          I mean neither premium paid, nor bonus accrued are considered for subsequent bonus computation.

        2. Yes, its related to Sum assured, its given as “Rs X for every Rs 1 lac sum assured” . something like that !

  19. vijay says:

    Dear Sir/Madam,

    I have 3 policy from LIC and i paid apprx 6 lakh in Last 8 Years to LIC now when i applied for Loan they are saying total amount is Rs 4.20 lakh and it is just the 65% of the total amount paid.

    Can you let me know why it is so less.

    Vijay dahiya

    1. Hi vijay

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


  20. uday says:

    Hi Manish,

    What is a term plan ? Is it preferred over Endowmnet plan ? Any good term plan you can suggest from LIC or any other reputed organization?


    1. Rupesh says:

      Based on your requirement i can give u a quotation.

    2. We suggest HDFC term plan. Incase you are interested in that . We have a tie up with HDFC and we can connect you with them .. Just fill up the form here

  21. ARKUSH says:

    Sorry , forgot to inform the policy details in my earlier mail .The policy Plan is 162-10-06

  22. ARKUSH says:


    I took a policy from LIC in 2006 for Rs.5 lac. The premium payment term was 6 years ( which was paid) and the term of the policy was 10 years. Now in March, 16 , my policy is maturing. Shall be grateful, in case the LIC maturity amount is informed to me( the total maturity amount). No one in LIC including their agent are not able to calculate and inform. Thanks

    1. Hi ARKUSH

      I suggest that you now take the RTI route. You can file the RTI and ask your queries to them. THey are bound to reply you on your queries.

      Its a bit long cut, but works well


  23. Sthitapth says:

    Hi Manish,

    Excellent article. But I read it 10 yrs after I took LIC policy:-( Wish I could have read it earlier. I have Jeevan Anand policy with 20 yrs term . I have already paid 10 yrs premium. I spoke to LIC people and If I make it paid up now – I will get around 7 lacs after 10 yrs from now (as some accrued bonus already there). If I continue to pay , I would be paying another 400000 as premium and I would be getting 16 lacs at the end approx in total + 8 Lacs coverage for another some years (as term plan). Instead if I start SIP and invest the same 4L in mutual fund with 12% return rate, I will be getting 8Lacs approx after 10 yrs of SIP. That is 7+8 = 15 lacs Almost same as regular paying policy. But in LIC its guaranteed and in mutual fund is not with risks. Am I missing anything here before I decide or any important info I need to consider before making LIC as paid up? Can you please help me in this.

  24. subramanian says:

    I enrolled myself in jeevan anand policy in the year 2014. It’s basic sum assured is 2,00,000. It is a 15 year plan. So at the end of maturity how much amount I will b getting? Can you explain me the breakup?

    1. Hi subramanian

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information


  25. SomNath says:

    Hello there,

    I get this article and it’s very knowledgeable really.
    I would like to know something about the Policy. As Can we change Policy terms, Sum Assured and Premium ?
    Is it possible online ? Because Agent can’t get correct details. As I can see in your article. We need maximum 3 years for surrender any policy. But I have opened Jeevan anand 815 for 16 terms and agent said you need to maximum 5 years for surrender policy otherwise you will never get any amount. Is it true ? Please advice.

    Thank You!

    1. From what I know, its 3 yrs .. check your policy documents !

  26. siva says:

    dear manish, iam enrolled to 175 and iam paying the fourth premium this january.there is 10% money back (policy for 10 lakhs)at d end of fourth year. where and how should i collect the money i.e 1 lakh.

    1. Avinash Sardesai says:

      LIC should communicate you regarding the same. It is better if you submit your NEFT details to LIC so that you get the amount deposited to your account.

  27. Ambikesh says:

    Thanks for the information.
    I’ve held multiple policies of LIC for over 12 years now. Recently I got a call about loyalty bonus on fine policy. The caller told me that my agent hasn’t responded and the loyalty bonus will lapse. I talked to my agent and he said that it’s a fake call.
    Would you please elaborate how loyalty bonus is paid and when?


      1. Ashish says:

        Thanks Ambikesh for asking this question and thanks for reply Manish. I too got similar call today. He too asked me to contact agent for getting loyalty bonus. He mentioned that agent is saying, “I don’t want bonus and LIC can deposit 40% in agents account”. I asked him details about my policies for which he is getting bonuses etc. He didn’t give me details. He asked me to contact him back if agent doesn’t reply.
        Thanks for details provided by you in above thread. Now I understood many things about LIC :-).
        I will now raise complaint under DND against this caller.

        1. Glad to know that Ashish ..

  28. ravinder says:

    I have jeevan shree II T No 112 at annual premium of 24981 started in 2000 for 16 years and term is 25 years.. Its status is now fully paid up. What is my best bet now… My husband expired two months back. I need to sort my life now with three small kids daughters all age 8. Please guide me what I should do.

    1. I suggest that you should take all the money and then decide later what needs to be done with it

  29. teja says:

    Hi Manish I want start lic policy what is basic amount per month or year any best policy

    1. We dont suggest LIC policies

  30. christopher says:

    Hello Manish,

    Excellent article.. makes things very clear.. though there is still that emotional attachment that you mentioned. I have foolishly taken an endowment policy paying 1 lakh a year for a period of 33 years.. I have paid 2 years and the 3rd premium is upon me.. agent says I can surrender it only if I pay the 3rd premium.. what do you say? will I lose more or gain if only a little bit. I am ready to walk away from the 2 lakh if you say that I will be losing more than I will gain. Awaiting your reply

    1. I cant decide on your behalf 🙂 . Its a very tough call , but yes getting out of this will make more sense in longer run

  31. Dharmraj says:

    I am new to this LIC and investment,

    My simple question is should i buy LIC or not?, If yes then in which ?
    I can go for max 25k(per year) investment.

    1. Its not about LIC or some other company. If you are buying a right product, any company is fine !

  32. Deepak says:

    Dear Manish Chauhan

    I have taken Lic Jeevan Saral 165 in 2011 September . Half yearly Premium of 24260. on Terms of 20 Years. Can you please tell how much will i get after policy complete.Thanks

    1. Hi Deepak

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information


  33. Raghav says:

    The article was very insightful.

    Question on Simple Revisionary Bonuses Vs Sum Assured Vs Premium Paid: I have Jeevan Anand plan and have been paying 9k for last 11 years and have 4 more premium paying years left.

    From LIC’s bonus table as of 31/3/15, I’ll be getting about 34k as bonus at end of term. Though my sum assured is 1L and I’ve already paid 1.19L and assuming bonus would be about 34k to 38k per thousand when policy matures, what would the approximate cash that I would get? Will it be 1L plus 34k or something more (I Yes, I will be surprised).


    1. Hi Raghav

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information


  34. Mohit says:

    Dear Manish,
    After reading your article I realized the drawback sort of thing applicable in LIC policies.
    I’ve enrolled in LIC 75F Money back 20years policy 7 years back 12600Rs being premiun annually..
    As per policy terms I’ve got 20% money of Sum Assured after 5 years already in my account.
    My vested bonus is 48000Rs.

    I’ve 2 doubts :-
    1) Can i get my bonus now?? (U wrote its only after maturity or death)

    2) Should I surrender my policy now?

    1. Hi Mohit

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information


  35. sailesh singh says:

    Dear Manish,
    I had opened jeevan pramukh policy and have completed the premium . Could you please let me know what is the sum or amount of money i will get back after the maturity of the policy, unable to calculate.

    Thanking you,

    1. Hi sailesh singh

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information


  36. Sharmaa says:

    I have Two policies …

    Plan 5 The Whole Life Policy – Limited Payment – 10,398/- Half Yearly.
    Plan 14 The Endowment Assurance Policy – 41,507/- Half Yearly.

    I started in August 2013 with Premium Paying Term 20Y. Now I want to know is it good to continue these policies or stop and invest in any other Product? I have already taken a Term Policy for 35 Years with Cover 1 Crore.

    Please Advise?


    1. They are good policies, they will pay 4-6%

  37. sandesh says:

    I have a lic policy table 75-20 money back,paying premium since last eleven years, sum assured 5 lakh accrued bonus 197000 can I have any loan from lic

    1. Hi sandesh

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information


  38. sathish says:


    Will i go with Jeevan anand or New endowment policy, both are same as per my consultant. but i’m ready to pay Rs.2000 pm. with term of less than 21 years

    Kindly suggest which is best.

    1. None of them is good. Better invest in RD or just mutual funds

      1. Nitin says:

        There is not assururity of ur life security in R.D.

        1. In that case, take a term plan for life security

  39. Masood says:

    Hi Manish, I have a LIC policy of Jeevan Saral for 21 years taken in August 2013. I have paid 2 annual premiums till now for Aug 2013 and Aug 2014. My next due date is Aug 2015. But due to shortage of cash, I wont be able to make the 3rd premium. Also, I want to either surrender or make the policy ‘paid up’ (coz I can wait till maturity to get something back). Can you suggest the best course of action. Do i have to inform the LIC office or just stop making the payments for making the policy ‘paid up’?

    1. heman says:

      brother as you mentioned you paid two premiums. please do not stop paying premium if you do so you will get nothing. pay the premium after 2 to three months after due date. lic will charge nominal fine and it will get started again.
      Please note.
      1)there was no service tax when you take the policy.
      it is a good plan.

    2. a says:

      not need of surrendar will pay after 6 month no issue.

    3. Hi Masood

      You should make it paid up . Just stop paying premiums and it will become paid up , BUT ONLY AFTER 3 yrs of payment


  40. Nitin says:

    I am paying 48,000/annum for last 2.5 years i.e i have paid 1,20,000/- so far. Please suggest should i continue or drop. But drop means forego 1.2 lacs. please advice.
    Policy Name : LIC -Jeevan Saral ( Plan 165)

    1. hemant says:

      please do not do so.
      continue it

    2. I suggest you continue it for some years nad then surrender !

  41. fayaz says:

    i have taken a policy Komal Jeevan on 25/03/2010 I am paying it regularly in quarterly basis of amount 2070/-. In that one it is written as the policy term is 25 and premium paying term is 17.

    Really i didn’t understand the agent explanation at that time. May i know what are the benefit i/my child get it with an example.

    How may years i have to pay and what are the benefits i will receive.

    Awaiting for your valuable answer.

    1. You need to pay total of 17 yrs, but the maturity of the policy will happen after 25 yrs of taking the policy !


  42. kapil says:

    Hi just gone through your comments. Have few queries please suggest.
    I have 2 Jeevan Saral policy 60,000 + 60,000 1.2 L per yr. Its 3 yrs now, 3,60,000/- premium paid till date and want to close the policy as u suggested.
    1. Shall I surrender it or make a paid up?
    2. Take a loan on the policy?
    3. Shall i reduce the premium amount?
    What will be the best solution? do you have any other thought ?

    1. Hi kapil

      I think you should make it paid up or surrender the policy.


  43. Peeta says:

    Dear Manish,

    I have taken Jeevan Rekha LIC policy during 2005 ,10 years term with 10% cach back every 5 years. After paying full premiums ( last premium was on 2015 march) my agent told me that I will only get the SA ( 30000 USD) only aftre my 80th year ( my agnt actually explained me endowment policy and given jeevn rekha ) . As i am unmarried (43 years) and my nominee is my mom ( 67 years) is there any way I can get my money now rather waiting untill my 80th year.
    Appreciate your help

    1. You can make the policy as PAID UP , and you will get the money, but not the full , only partial !

      1. Peeta says:

        Thanks for your response Manish,
        I believe paid-up value is only when you have still premiums left.. But in my case I have fully paid the premium. Will I be eligible for altering the policy as “Paid-up” ? if so how much percentage I will get.. ( i have already received 3000 USD during 2010 and I will receive another 3000 USD this week).

        Please advise

        1. No its not like that. Check your policy details . Even in case of one time premiums, the paid up value concept exists, but the final thing would be in the documents. Once you get $3000 this week, after that you apply for paid up policy


          1. Peeta says:

            Thanks Manish,

            sorry to ask you the same , roughly how much percentage i will get if I apply for paid up?

            1. Only LIC can tell you that

  44. Mohammed Rabbani says:


    Kindly suggest, where can i invest my money. As per my religious terms, Interest given & take is prohibited. My monthly limit is around 15000/-.

    Do the needful.


    1. Hi Mohammed Rabbani

      But anywhere you invest, you are going to get interest profit or something more than you invested


  45. Mohammed Rabbani says:

    Thanks for your information.

    I have taken Jeevan Anand Policy in 2012. But now i want to Withdraw, due to some personal problem. But, as per your suggestion, im going to lost money.

    Can i Convert my policy into any other Policy.


    1. Converting is not possible

  46. mohit srivastava says:

    Very nice and crisp…cleared my doubts and I liked that you kept it so simple…

    1. Thanks mohit srivastava

  47. anil says:

    I have LIC Jeevan Mitra
    Table 133
    Premium Rs 13000/-
    Started in Year 2000
    Have paid 15 premiums so far
    Term 30 years

    I calculate IRR, it is very low.

    Shall I continue for next 15 years?
    Or Surrender?
    Or Just stop paying premium and let it get converted to paid up?

    1. I dont think you should continue . Better surrender or make it paid up

  48. K Bhardwaj says:

    Hi, Manish,
    I have a jeev Shree policy. Date of commencement 14/06/2001, date of maturity 14/06/2021. Premium Rs 52661/ Last premium paid in June 2012. Sum assured Rs Seven Lacs. I took a loan in Dec 20111 of Rs Five Lacs . Half yearly interest is Rs 22860. I want your advise what are the pros & cons if I surrender now or wait till maturity. I have requirement of funds for education of my son.
    K Bhardwaj

    1. I have already shared exactly what you are asking in the article. Did you go through it ?

  49. K Bhardwaj says:

    Hi Manish,
    Please advise, I am holding Jeevan Shree policy table & term 112-20 (12) Sum assured Seven Lacs, Date of commencement 14/06/2001, date of maturity 14/06/2021, date of lastPremium payment 14/06/2012 , Premium amount Rs 52661/ . All premiums have been paid. I have taken a loan of Rs Five lacs & eight thousand on 24/12/2011. Interest being Rs 22860/ half yearly . but I have not paid any interest so far. please advise if it is in my interest to surrender / wait till maturity. As I may require funds for my sons higher education. Regards

    1. K Bhardwaj says:

      Hi Manish,
      Plz also let me know roughly how much amount I can expect after deduction of loan amount & interest , if I decide to encase within one/ two months.

      1. Which loan is that ? Is it against the policy ?


        1. K Bhardwaj says:

          Yes it is against the policy.As per latest surrender quotation dated 06/04/2015 .Paid up value Rs seven Lacs, total bonus Rs Seven lacs thirty five thousand ,surrender value payable Rs Eight Lacs seventy thousand Six hundred & fifteen. Please let me the pros & Cons of encasing now/ on maturity
          K bhardwaj

          1. Then you can surrender it now . Its better to take less now and reinvest or use , rather than take a little higher sum later


          2. K Bhardwaj says:

            Dear Manish,
            please let me know what amount I will get now on surrendering / surrendering on maturity. how much is loss amount wise.
            k bhardwaj

            1. That only your company LIC will be able to share. The calculations are with them only

  50. rushi says:

    Hello manish

    I have gone through this blog first time & i think that you would be the one who will take me to the precise solution to the issue.

    right now I am having 6 policies.started in march-2012 (3 yrs back)
    Plan Nr Enrollment Date Prm Amnt Sum Assured Plan PP term
    179 19-04-2013 1,671.00 5,50,000 New Bima Gold 20
    14 19-04-2013 960 2,80,000 The Endowment 24
    5 19-04-2013 801 2,75,000 Whole Life ltd pol 28
    14 19-04-2013 690 2,70,000 The Endowment 32
    14 19-04-2013 415 1,80,000 The Endowment 36
    14 19-04-2013 118 55,000 The Endowment 53

    now I realised by calculating few figures that i have made mistake by investing so much money in it.

    I am thinking to surrender it all ut found “paid up” phrase above in the blog.
    can you plz suggest what shall I do with these policies to face minimum loss?

    I dont want to continue such blocking of money where I am myself not having any idea whether its really beneficial or not.

    1. If you close it before 3 yrs , you will loose all the money. But even continuing is not a good option !

  51. Pradeep says:

    Hi Manish, I have taken 3 policies actually
    1. The Endowment Assurance Policy.
    2. Jevan Anand.
    3. Jevan Mitra Triple Cover Endowment Plan.
    Every month i will be paying Rs.2206 (Including Three Policies). Almost from 4 years I am paying means around 1,06,000 i have already paid. And this is 25 years policy plan. My question is while doing this policy I have not asked any doubts but now after reading all these things I am getting few doubts. How much I will be getting once these policy get matures. Premium details
    1. The Endowment Assurance Policy (Rs.663)
    2. Jevan Anand (Rs.741)
    3. Jevan Mitra Triple Cover Endowment Plan (Rs.802).
    Inclucing all these three policy i am paying 2206 per month.
    Can u give me rough figure how much i will get after 25 yrs….?

    1. Hi Pradeep

      For that you should contact LIC only. THey will be able to give you right picture !

  52. NITIN J BARVE says:

    I have gone through all queries and answers.
    in all insurance policies,there is component of saving + mortality+ expenses.
    if you bifurcate your insurance premium in two parts. The maturity value of saving portion will work out to 8% .TAX FREE ASSUMING CURRENT BONUSES.

    1. Hey NITIN J BARVE

      Thanks for sharing your experience with all of us. It was a great learning.


  53. Gajjan says:

    Hi Manish,

    I have paid 7 Yrs premium (60K/Yr) (of course cheated by agent) for Jeevan saral plan.Can i pay 3 more yrs so that loyalty addition will be added.

    Is my calculation is correct as below for loyalty addition.
    For 1000 Rs – LA is 375
    For 550000 -LA will be 206000 (approximately at the time of surrender)

    Thanks in advance

    1. How will you benefit by doing that ?

  54. Paramjeet Singh says:

    I am a LIC advisor and i considered your article as good as it is just educating people about choosing insurance go along with that. Insurance should be treated as a medium for Risk Coverage, but not to get huge return on investment. There are various other medium to invest money. Every insurance company work same way. Customer should understand that even paying small premium they are covered for big amount in case of any mis-happening with policy holder. This is the main benefit which no other investment can provide.

    1. Hi Paramjeet Singh

      Thanks for your sharing your valuable comment on this topic. Please keep sharing your views in future also


  55. kishor12345 says:

    if i surrender now they will give me 82000. (asked lic office)

  56. kishor12345 says:

    Dear Sir,

    Please can you advice me.

    I have jeevan saral policy of 48040 per ann. and have completed 3 years just now. I have taken this policy only for investment and tax saving & at that time i get misguided from lic agent. Now i want to exit this policy with minimum loss. i have following 2 doubts in my mind

    1) continue for 10 years and then surrender so that no surrender charges and will get some LA.

    2) surrender now (completed 3 years now) and invest surrender amount and next premiums in ppf.

    1. I think option 2 is better

  57. Kaushik Baruah says:

    I have a Jeevan Anand Policy for 25 years. I pay Rs 29,944 as annual premium and have already paid premium for 10 years. The vested bonus as shown in my LIC log in is Rs 349,500. Please let me know approx. how much will I get if I surrender my policy.

    1. Vested bonus is not the same amount which you will get if you surrender the policy .You need to ask LIC on the exact surrender value !

  58. santosh says:

    Good explanation from you…. Please explain how maturity amount is calculated at the end of policy period.

    1. Thats too complicated to explain and cant be done in comments section . Talk to company on this .

  59. Harinath says:

    hi manish, i hav taken jeevan anand policy with sum assured of 22,00,000 and annual premium of 107204 payable half yearly..,i hav paid 3 instalments of 53602(one and half year) till now.., ofcourse i didnot do proper research before taking policy and agent has nicely trapped me. Now i feel am doing wrong. so, 1st step i took is taking term plan from hdfc. 2nd step is am thinking of stopping paying LIC fella.
    1st question -Is it a good decision because i wont get single penny out of it.
    2nd question – my agent paid 26k of 1st installment – wil he come and ask me money. if e asks wat should i do.

    1. Harinath

      You can choose to stop it, but I would say if you anyways want to put most of hte money in FD or PPF , then you can continue it and let this be the debt portion of your financial life.

      Your agent will not ask for the installment

      1. Harinath says:

        Dear Manish ji,
        thank you for ur reply. yes i was thinking of putting same amount in FD/PPF.., it works as debt instrument if we remove tax part, IRR is around 8%. i’ll continue with it.

  60. anand says:

    hi Manish,

    I had paid my first premium in Jeevan Saral @ Rs. 24k per year in June 2007 and have paid till June 2014. Now it is clear i want to surrender the policy after reading the article and above queries, but does it make sense to wait for 10 years to complete, or do it immediately?


    1. I would have surrendered it now itself 🙂

  61. nitesh says:

    And i received a call from the LIC company they told me that we provide the bonus after completing a year and we paid our clients by cheque and that bonus is from our side LIC company..

  62. nitesh says:

    THANKKS @ LOT…..but can u tell me what amount of bonus i will get at the end of the yearfor e.g:if pay monthly a 1000 rs then what amount of bonus i will get at the end of the year…….

  63. nitesh says:

    Hi Manish,

    I had taken LIC policy last year and completed one year also, is there any bonus provided by the LIC company ,and would i can get that in my account or i will get at the end of maturity.

    1. You will get it at the end of the maturity !

  64. thomas says:

    4:48 PM

    Dear Manish,

    Excellent article. I end up reading this article when I decided to reconsider continuing my Jeevan Anand 149 Plan. I am in a real dilemma whether to continue or dump this policy and I think you would be the perfect person to answer that.
    Policy details : Jeevan Anand 149 plan, Premium quarterly : 17,983 Rs, Maturity : 21 years.
    Start date : 09/05/2011.
    The policy is currently lapsed and I have paid my last premium on 09/02/2014. I just want to know
    a) surrender the policy as I have paid premium for min 3 years?
    b) Continue policy till the 5 th year and later surrender?
    c) Make It a paid up policy and wait for 21st year for Maturity benefits?


    1. You can leave it unpaid and it will be in paid up option !

      1. THOMAS says:

        Hello Manish,
        Yesterday I met my LIC manager and we had a good talk for half n hour or so . He was kindful enough to provide me the “magic matrix numbers” . I can send you this pdf report which shows the annual premium and the returns for successive years. As per this, if I surrender the Jeevan Anand policy now, i would be getting 1, 45,000 Rs , where the total premium paid would be 2, 75000.
        If i make this a paid up policy , my returns on 21st year would be less than what i would earn if I invest 1,45,000 in Mutual funds ( assuming 10% returns with MF and 5.5% return with LIC). I have decided to take a term insurance and may be I can split some portion of the surrender value in this and rest in PPF and mutual funds. In this regard, I would like to know your thoughts on making this policy paid up ( as suggested by you before)?. Also, if I surrender the policy now, what is the best tax saving option to invest the surrendered money so that I would beat the LIC returns of 6 % max ( with bonus +FAB etc).

        Eagerly waiting for your reply

        1. Let me put a mail to you

          1. thomas says:


  65. Deepak says:

    I have read this blog as well as the comments on this blog.
    I have a question regarding Jeevan Anand just like all others.
    I have a LIC Jeevan Anand for the sum assured 10L, for which I have been paying premium of Rs. 4ok every year, and 4 premiums paid.
    I have gone through your blog and understood that its not good to mix investment and insurance, and that is very clear to me now. And I have almost decided to come out of it. I have a question –
    Lets consider this scenario,where think of this Jeevan Anand just as investment (since I had already paid some premiums).
    As per the agent and a few sites on the internet, after 25 years (20 yrs from now), I will get around 24 L as maturity amount, and cover of 10L still continues.
    Now, lets say I come out of it, I had already paid 1.6L and I will only get 80k.
    Now, lets say I put this 80k in the PPF as starting balance, and keep putting the same 40k per year also to the PPF, considering the 8.7% interest rate, it will become approx 25L after 20 years.

    So, don’t you see not-much difference between the two?
    Or 24L claim by agent etc is not at all true?
    I know the maturity values depends on bonus and FAB, but still is it far away from actual maturity value?

    Please resolve my final concern.

    1. Yes, most of the times the numbers given by agents are projections .. I suggest you find out the IRR of the policy and decide on that ..

  66. pradeep kumar sharma says:


    1. Depends on the policy rules

  67. Hemant says:

    I have Jeevan Tarang Policy. I paid 04 premium. One year premium 73430/- policy term is 20 yrs. if i am not paid any premium now than how much amount i will get end of 20 yrs. Or i will continue to this policy.

    Pls advise

    1. You will get all your premiums paid till now at the end of the policy !

  68. anil says:

    Iam anil i have lic jeevan saral polici i paid 3 premium (4700 yearly) i want surrender how much i will back?

    1. You will get just the 1 yr premium back at this point

  69. Mohanreddy says:

    Dear Sir,

    I have LIC Jeevan Anand Policy for 16 years,
    Last year i have taken the policy
    Per year my premium is 51,888 /-
    After 16 Years how much amount i will get.

    Thanking you sir,


    1. You will get all your premiums + bonus

  70. chavan says:

    Thanks Manish And Nandish, good information with simple language, can be understood by any one,spending few minutes to get basic knowladge

  71. devendra says:

    hello sir,
    just eagar to know why we buy LIC policy to get 6-7% return.
    isn’t it better to go fix deposit.

    1. Valid question … But most of the people never get that question at all !

  72. Abul Fujail says:

    Hi Manish Chauhan,
    What about Postal Endowment policy. Whether is it better than insurances provided by other organizations? I have seen lots of complement on your article but not finding the article. Can u plz send it.

    1. Any Endowment is not recommended

      1. Abul Fujail says:

        Can u plz give me an idea about the disadvantages of Endowment policies. How others are better than this?

        1. Abul

          Do you know what is the % return you get from them over long term ? Its below inflation almost all the times . Thats the main disadvantage !

          1. Abul Fujail says:

            Thank you Manish Chauhan… its 100% correct… Still i want to know the which one is better, LIC Jeevan Anand or Postal EA. According to agent, LIC is giving more resturn. I am not sure whether is it correct. In Postal return is on average 65/1000. My age is 30, if i do it for 20yrs. Investment may not be possible as i cant invest at a tome. Monthly i have to deposit.

            1. In that case you can go with LIC only !

  73. Nikhil says:


    My wife has a Jeevan Saral policy initiated in 2011 through a relative of her’s. Now this relative has paid up first premium and have not paid the remaining of premiums which she came to know couple of months back. Now she has two options:

    1. Pay 4 due premiums which penalty
    2. Leave the policy redundant

    Going for 1 would mean 4 Installment but 8% Interest on it as Penalty (Am I correct here?) Going for 2 means losing the 1st Installment i.e. 18K. I know there would be no benefit before 5 years when we can surrender it.

    Now if I plan to renew the policy, will I get benefit of the 4 installment that has been delayed i.e. Interest and bonus associated with it? Should I leave it like this and make this 4 installment investment in some pure investment avenue.

    Please suggest.

    1. I would personally go with option 2 , and restart my investment plans !

  74. Santanu Chowdhury says:


    I have a LIC policy , Table no 151. I started paying Premium in 2003 March.
    Premium= 113,000
    SA = 10,00,000
    I have completed my premium paying period of 10 yrs and waiting for maturity in 2018 March.

    At this point if i withdraw , how much i can expect back from LIC.



    1. That can be shared only by LIC . Login to their website , your account and you can get this information !

  75. Viren says:

    This is very nice post.
    I would like to have a quick snapshot calculation against LIC loan.
    for eg. If I take 1 Lakh loan against my policy fulfilling loan eligibility then how the Premium+interest gets paid to LIC over the period of time…
    Can anyone explain in amt paid over month-year format till the loan becomes nill


    1. This is more of a discussion questions, a better place would be our forum to discuss this –

  76. Jimmy Jose says:

    Hi Manish,

    Thanks for this very useful article!

    I am invested in ‘Kotak Mahindra Money Back Policy’ since 44 months. Its SA is Rs.500,000/-; Maturity Period is 20 years; Monthly Premium is Rs.3003/-.

    The Policy Document states that 20% would be paid thrice after every 5 years, and Rs.350,000/- at maturity, which comprise the remaining 40% and some bonus.

    1] Does that mean that the total premium paid by the end of the 20th year would exceed my returns of Rs.650,000/-?

    2] Does this policy have the ‘Paid-Up’ option so that I can stop paying now and remain invested for 16 more years? If YES, how much can I expect of it at the end of 20th year?



    1. 1. Yes, along with Bonus, I guess you will get more than 650,000

      2. You need to check their brochure for that,but Yes, there is always a PAID up option !

      1. jimmyjose2980 says:

        Thanks Manish!

        Any idea what amount of bonus can I expect?

        1. The exact amount can shared only by the company

  77. Kishan says:

    Hi Manish,

    I read your article, its very helpful and upto the point. I got information about paid up policy by reading the article & below comments.
    I have recently started my policy, its been 2 yers and I have paid premium of 54000/year. Now its my 3rd year, I need to make payment in the month of July 2014.
    I have 2 questions for you:
    1. Do i need to continue till 5 years and stop paying the premium or STOP now only??
    2. If I stop paying the premium, it will become paid up. Will LIC still give me Insurance coverage ??


    1. If you stop it now, then it will NOT Become PAID UP , because you have not paid till 3 yrs , only after 3 yrs of payment it gets any surrender value .

  78. Jayan says:

    Hello Manish,
    While goggling for good investment plan for my future I came across this site. Nice initiate and it will help people like me.
    I need your advice for best investment plan.
    I have plan to buy SBI life’s Shubh Nivesh or HDFC progrowth plan for sum assured 1,000,000.
    Is it wise advice or should I go with PPF or RD else pls advice.
    Already ordered for your book and it will delivered on 7/2.


    1. I would suggest going with basic level products like PPF , RD or mutual funds

      1. Jayan says:

        Thanks Manish.
        I have started SIP on SBI MF Magnum global and Blue chip fund
        Not sure this is good plan, please suggest some best plan for SBI and other AMC’s

        1. Jayan

          For suggestions on mutual funds, please open a thread on our forum

  79. Pingback: Which is the best bank for Home Loan
  80. mayura says:

    Hi Manish, if there is no question of surrender, is LIC a good option for “return on investment’ for long term plan(15yrs). I’m asking because I’m not sure I can be very disciplined/active player in the MF area for this long duration. I’m done with PPF, so this is over and above that. Thanks in advance

    1. Yes, if you are not going to surrender, LIC can be a ok choice, you can get around 5-7% return over a long term, you have to be ready for it then ? Is it ok ?

  81. Amit says:

    I am taking jeevan saral policies and yearly premium is 60,000.

    But due to some reason i need to save the money for some expense right now. I paid premium quarterly and three installment i paid total money i paid is about 45,000.

    so what should i do, to get my money back. or i hv to close it and bear the loss of 45000. please guide me. or wait for 5 years so that i will get good amount

    1. Amit

      Jeevan Saral acquires a Surrender value only if you make payments for 3 yrs . If you stop your payments before that you will loose everything !

  82. Raj says:

    Hi Manish,
    I have a LIC pension plus (T No 803) commencement on 24-Sep-2010. I am paying quarterly premium of Rs.12,000.00/-. Till now I have paid Rs.1,56,000.00/-.
    Now I want to complete withdrawal of my above policy. At looking at the 5 years lock-in clause of the policy now I have 2 options. First, pay my premiums for next 2 years. Second, do not pay any more premiums. How LIC will calculate my fund value in both the scenarios? Which will be good?
    Please help as from policy documents I am not able understand and conclude the same.

    1. I think its a market linked product .. If it is , there its not a matter of calculation, because its not based on a formula .. I would say check both the scenarios and take a decision. Its always better to do these kind of discussions on our forum –

  83. sriprakash says:

    Hi Manish,
    I am sriprakash from Bangalore.I have total 9 lacs to invest which can give me good returns every year.Please suggest me ..I cannot invest on real estate and all as i have total only 9 lacs and my salary also very less.Please suggest me some good fixed deposit/mutualfund/nsc/government bonds.

    1. You should then invest in some fixed deposit and choose interest for quarterly basis to make sure that you have some regular income out of it

  84. Hari Krishna says:

    Hello sir,

    I have an LIC policy ‘Limited Endowments+’ that I have started in 2002 with an annual premium of Rs 49,676, and it is meturing in 2027. The sum assured is Rs 10 lacks. The ‘vested bonus’ accured so far is Rs 5,14,000. Given the advent of mutual funds and other investment options, is it advisable to continue this policy or I better invest elsewhere? If I close the policy now, howmuch will I get approximately? Please suggest a course of action. Thanks.

    1. What is the return you are getting on this policy in percentage terms ?

  85. Biju says:

    Excellent article.. I did not do any math when I took a LIC policy in 2003 for a high premium for 20 years just to avoid tax. Because of inflation the returns on 2023 is actually very very less. I am pretty sure by 2023 the money from LIC would be 6 months salary for medium IT profession or even less then!!!! This should be an eye opener for many ..

  86. Hvishal says:

    Thanks for all your valuable comments. I need your help to understand whether I’m going for right plan.
    My LIC agent has suggested me Limited payment whole life with profit plan (table 5). Premium per year is 31000. SA is 9,00,000. Premium paying terms is 20 years. Maturity is at age of 80. Risk cover given is 9 lac from first year and keep on increasing till 71 lac towards the maturity i.e. it increases by 50,000 every year. Maturity benefit is around 71 lac. Can you please let me know if this is good plan to buy, as risk cover appear to be good. Of course the guaranteed risk cover is 9 lac but including bonuses it goes upto 71 lac. Please help.

    1. I think you should wait for some time for more clarity on any traditional plans . read my article which I publish today on this regard !

  87. uranakar says:

    07 Aug 2012 06:42 AM
    ‘Endowment Plans are not bad’
    D V Suresh, DVS Consulting, Hyderabad
    Share on facebookShare on twitterShare on email

    D V Suresh of DVS Consulting says that surrendering an endowment plan
    just because it gives lower returns is not a good idea. He says that
    endowment plans can be safely considered as debt component in the
    asset allocation, instead of asking the client to surrender.

    A lot is heard and read about surrender of endowment plans in the
    media. No doubt term cover is one of the cheapest ways to protect the
    family for income replacement, but that is not the only thing that
    protects the family from practical situations.

    There is no doubt that investing in equity and mutual funds do give
    better returns, which is the basis on which the CFPs are advocating
    surrender of Endowment plans. And it is one of the easiest ways for
    the CFP to impress the client by comparing higher returns through
    equity based investment with the returns of endowment plans.

    While endowment plans do not give better returns compared to mutual
    funds, what is lacking in the advice is the practical aspect of

    We prepare a comprehensive financial plan or for that matter even a
    goal based financial plan and advise the client that a systematic
    investment in the chosen mutual fund will meet the goal which will
    beat inflation. But, can we look at this more practically?

    As human beings we are disciplined only when we are compelled to. When
    there is no compulsion the discipline tends to go awry. This is proved
    by the fact that approximately only 40% of the persons who have
    started the SIPs (Systematic Investment Plans) with mutual funds are
    actually staying till the end of the term. This means, 6 out of 10
    discontinue in between.

    When this concern was discussed with some of the CFPs, the answer was
    “it is up to the investor to stay the course if they want to meet the
    goal”. Agreed that it is the individual’s necessity so he better stick
    to his commitment. But as professionals, is it not our duty to also
    look into it more practically?

    Life is not as smooth as it appears on paper. In spite of all the
    planning, life can throw surprises and unforeseen emergencies. So in
    such circumstances the easiest fall back is on funds that are easily
    accessible – mutual funds. And what goes for a toss is the goal for
    which the mutual fund was meant for.

    Imagine a situation where a person had planned his/her child’s
    professional education or daughter’s marriage. If he/she had invested
    only in mutual funds and taken a huge term cover, and unfortunately a
    situation similar to the 2008 global meltdown arises. Where does the
    person stand? Can the person postpone the child’s education because
    the Planner failed to protect them in such situation?

    Dear CFPs, please note that it is very easy to advise surrender of
    policies, but wake up to facts of life and reality. Working on excel
    sheets no doubt gives impressive output, but let it also work in all

    To substantiate my view, I have taken an example of a 35 year old
    person who has taken LIC’s endowment plan for 21 years in order to
    accumulate some money for his child’s overseas education who is one
    year old. Now let us see, how this endowment plan performs..

    I have considered two scenarios i.e., with tax benefit (30% slab) and
    without tax benefit (under section 80C) after setting aside the term
    cover part of the premium…

    Investing in a term plan vis-à-vis an endowment plan

    Without Tax Benefit

    With Tax Benefit

    No Tax Beneift but with Term Cover Included

    Annual Premium

    Rs 47888

    Rs 47888

    Rs 47888

    Less: Savings in Tax


    Rs 14654


    Less: Term Cover Premium

    Rs 5600

    Rs 5600


    Net Premium

    Rs 42288

    Rs 27634

    Rs 47888

    Term of Endowment Plan

    21 years

    21 years

    21 years

    Total Net Premium Payable

    Rs 888048

    Rs 580314

    Rs 1005648

    Risk Cover -Natural Death

    Rs 10,00,000

    Rs 10,00,000

    Rs 10,00,000

    -Accidental Death

    Rs 20,00,000

    RS 20,00,000

    Rs 20,00,000

    Maturity Amount

    Rs 21,08,000

    Rs 21,08,000

    Rs 21,08,000

    Yield on IRR basis




    In the last column, we see that in spite of including the term premium
    and by also not considering any tax benefit the internal rate of
    return (IRR) works out to 6.30%, while the first two columns show
    clearly the IRRs with and without considering the tax benefit, which
    are 10.62% and 7.30% respectively. These are conservative returns, and
    the capital is also protected. Thus an endowment plan can be safely
    considered as debt component in the asset allocation, instead of
    asking the client to surrender.

    Yes, one can include existing insurance plans based on its merits and
    then suggest improvements and additions while drawing up a financial

    This will indeed help the client overcome an adverse situation by
    protecting the extent of the maturity amounts from endowment plans
    which are not directly impacted by the market fluctuations.

    The views expressed in this article are solely of the author and do
    not necessarily reflect the views of Cafemutual nor does Cafemutual
    take responsibility for the accuracy of any information in the

    1. Good article . Overall I agree with the writer on the aspect of compulsion . But then I think that those who can not control themselves and need some compulsive approach to make their financial life better actually deserve lower returns.

  88. Anand Mahamuni says:

    One of my “close friend-n-my LIC Agent” has presented me an retirement plan for my wife (age 40): Jeevan Saral – term 22, yearly premium – Rs. 72060/- and paying upto 2033
    He say it has to be started in this month (aug – or latest by Sept 2013) as there would be “service charges added in all the LIC policies starting in Oct 2013” [is that really true]

    1] Retirement monthly Income – would be Rs 25300/- (age 61 – in 2034)
    2] withdrawal available of Rs 42,83,305/- (age 61 – in 2034)

    What do you say on this – from a view of an retirement plan?

  89. ashok says:

    u r genius in investment advisory. LIC is government of India unit .IF lic is duping ,then government is duping or misleading why cant u make a forum fight against it .Advertise in all indian launguase magazines regarding the matter. Govt has invested rs 5000 core when it is nationalized private blade insurance companies. & getting heavy dividend for it .Guide villagers to have life cover ,return of good return with good profit, because they r unaware of equity ,mf etc.They will be followed by blade greediness. they will lose principal also.Against this why cant to u approach honorable supreme court in the matter .

    1. Yes, lets do it together . As you have already accepted it , will you help us in this movement ?

  90. Sam says:

    Can you please explain the difference between ‘basic sum assured” and “maturity sum assured” in Jeevan Aastha LIC policy? When will these amounts be given to the proposer?

    Thanks in advance.

  91. Vignesh. S says:

    I have a doubt on one of the Policies named New Jeevan Suraksha.

    I am paying a premium of Rs. 50000 per year and i have completed paying 5 years in full and 5th year is completed. Could you please let me know how much will i be getting if i surrender the policy after the completion of 5th year.

    Vignesh. S

    1. Only your policy document will be able to show you that. Why not ask the same agent from where you bought it !

  92. Ayesha says:

    Dear Manish:
    I would like to know about
    1) the kind of investments LIC makes with the policy holders’ money?
    2) From a religious point of view, does it involves “interest”, which is forbidden for muslims?


    1. Muthu Krishnan V says:

      ayesha, LIC in turn invests in equities, government debt which definitely involves interest. I do not think any LIC product is shariah-compliant if that is what you are looking for.

  93. Arun Kumar says:

    Hi I have a Jeevan Anand policy, from last 1 year i had not paid the premium.
    and its 2 year old. if I paid the premium today.
    Can i avail the loan facility on the same???

    1. I dont think so !

  94. Raj says:

    I have invested on LIC Jeevan Anand(T. No.149) policy term 70(premium payment term 25) commenced on Sep-2005 with Rs.20978 payable yearly. Current surrender value is Rs.106626. Kindly advise should I surrender or continue it?
    I have also invested on LIC Jeevan Surabhi(T. No.108) policy term 25(premium payment term 18) commenced on May-2005 with Rs.20362 payable yearly. I have no information about current surrender value but received 50000 this month. Kindly suggest should I surrender or continue it?
    If you suggest to surrender then please let me know where to invest the same amount of money.
    Thank you .

    1. Make it Paid up option now

  95. Manisha says:

    What about alterations in the existing policies? What us the procedure and pros and cons?

    1. Not sure of your question . Elaborate !

  96. Rajesh Shetty says:

    Hi Manish,

    I am kicking myself in the nuts now. I learnt this the hard way when i had to surrender my birla and bajaj insurance policies since i was in an emergency… ….. I then started searching net on how these crooks cheat us…..I should have gone thru this article years ago………I still have 4 more LIC policies and have been putting my hard earned money in to them year by year… a quick calculation using your logical methods has proved me that i should have kept insurance and investment seperate. Thanks a ton for your article.

    Let more ppl go through this and understand things better. I am copying your article link on to my facebook wall. I want all my frnds also to get enlightened.


  97. p kumar says:

    Dear manish,
    i m a merchant navy officer in foreign going vessel.i want to buy a policy thr there any special plan for mariners??
    please suggest me which plan should i opt?/

    1. I dont there is any special plan like tht

  98. Murty says:

    My dear Friend,
    The majority is not always true. I respect your profession, probably you are an LIC Agent, but tell me one thing, A dalal is a dalal, a doctor is a doctor, but every TD&H is a great analyst, that includes Manish, You and me.I appreciate manish’s efforts, there might be one or two glitches, we have to rectify them and not to give seeping statements like everyone who is commenting here is a fool! THE WORLD IS A MIRROR MY FRIEND! IT JUST REFLECTS YOUR OWN PERSONALITY!
    Apart from LIC, tell me something better about other Insurers too! For instance, I got a mobile number of a previous employee allotted to me. That bloody fool from TATA AIG gives me annual reminders for the past 6 years, inspite of telling them politely and writing mails, giving complaints, still they are after me! What do you say? The Doctor knows how to grab patients? The vendor runs after the vendees???????

    1. Murty

      Whom have you address this reply to ?

      1. Murty says:

        Hi Manish,
        It seems some guy was writing comments using too much of his own intelligence and trying to belittle your efforts, and it is in reply to his comment I wrote this.

  99. pramod mishra says:

    I have a jeevan varsha policy of 9 year and I have paid premium up to 3 yrs . now i want surrender this policy. Can u tel now LIC how % paid me?

    1. Only LIC will be able to tell you

  100. Puneet Sharma says:

    Hi Manish,

    I have following set of policies

    Commencement Date Plan Name Sum Assured Premium Amount Mode Accident Risk Cover

    6/20/2002 New Bima Kiran 100000.00 873.00 Yly 100000.00
    6/20/2002 New Bima Kiran 100000.00 873.00 Yly 100000.00
    6/20/2002 New Bima Kiran 100000.00 873.00 Yly 100000.00
    6/20/2002 New Bima Kiran 100000.00 873.00 Yly 100000.00
    12/21/2005 Bima Gold 200000.00 6569.00 Yly 0.00
    5/25/2006 Jeevan Tarang 400000.00 20088.00 Yly 0.00
    1/11/2011 Jeevan Saral 1250000.00 5104.00 Mly 0.00
    5/3/2012 Jeevan Chhaya 500000.00 25690.00 Yly

    What do you suggest i should be doing with these? I had gone through your previous articles and somehow think i am stuck with wrong deals. As i don’t have much knowledge about these – please suggest.

    Puneet Sharma

    1. If I were you , I would make it paid up

      1. Puneet Sharma says:

        Paid up? Can you please elaborate on that.

        1. Puneet

          Its covered in the article itself

  101. Prakash says:

    Hi Manish,

    I have a lic policy of term 20 years with Rs 20,000 per year premium. I have paid premium for 5 years.
    Now if I surrender, will I get entire Vested Bonus or only 30% of Vested Bonus?


    1. You will get current value of vested bonus . its a future value

  102. Akash says:


    I have LIC jeevan anand policy.
    My Age-25 years
    Yearly premium-25000
    Insurance covered-1000000
    Tenure-35 years
    Sum Assured-4000000
    two premium paid as of now.
    What do you suggest, hows this calculations going..?
    Should I continue ?

    1. I suggest paid up

  103. Lavkush Sharma says:

    I have a Policy named Jeevan Anand Plan – 149, term 21 years with the sum assured of Rs. 3,00,000/- & the premium is 7407/-HYrly. I have paid 7 premium & want to avail the loan on the given policy. I have received the vested bonus of Rs. 28000/-
    Please tell me how much amount can I get loan on policy & what will be the surrender value. If I get the loan how much interest is needed to pay in how much time. Also explain the Vested bonus on the policy.

    Lavkush Sharma

    1. Lavkush

      All this info you will get from LIC only. the numbers given by us will not be accurate

      1. Lavkush Sharma says:

        Dear Manishji,
        I am just asking about the tentative idea & the basic knowledge of the terminology…….Please try to find out the way…

  104. venky says:

    dont surrender the policy before 5 years or 10 years in jeevan saral policy .surender policy after 10 years .
    take term insurance if ur intrested at the same time look at private companies claim ratio also .
    most of private life insurance companies do the fraud or cheating so be care ful before take any policy from new life insurance companies .
    LIC and SBI life are the best in present market .

  105. Shivakumar A says:

    whenever you decide to take a plan from LIC, please go to a experienced and full time Agent. Experieced Agents would be able to guide you better in term of Insurance and Investment.

    LIC is only for Insurance. Please do not mix Insurance and Investment.

  106. Raja says:

    Hi Manish
    I have invested in total of 10lacs(2 policies) in the past 10years in endowment assurance policy(payment term 20yrs policy term 25yrs), I am 38 yrs now do you suggest me to continue in this policy or surrender or paid up
    please suggest

    1. I suggest Paid up

  107. Amar Nath says:

    Hi Manish,

    I have taken a Jeevan saral Policy from LIC. I am paying rs 60,000 per year.I have paid 3 installments ie rs 1,80,000. When is the best time to surrender this policy.

    What will be the approx amount if i keep paying them for 20 Yrs?

    Amar Nath

    1. Do it in 5th year

  108. GODFREY CHERIAN says:

    Dear Manish,

    This site is really very good and very neatly explained.
    I have a query. I have taken jeevan shri LIC in September 2003 and is expected to mature in September 2013. I paid Rs.171,093/- every year for 6 years. The insured sum is KD.10,00,000/- . Can you tell me what will be the maturity amount in September 2013. Also, kindly advise if i can withdraw the money before its maturity in August 2013 (one month before its acutual maturity). Will i get the complete money or there will be some deduction. This is only becasue i will be in India only in July and August 2013. Awaiting your advise. Thank you.

    1. I dont think you can get it before , you can get it only if you surrender , but that will be a bad proposition at this moment when the maturity is so near . The amount you get will back would be as per the policy document you have got, why havent you looked at it ?

      1. GODFREY CHERIAN says:


        1. If its not written, it does not exist . Generally you get Sum assured + Bonus .So you will get sum assured and whatever is accumulated in BONUS , in the long you generally do not beat inflation with any kind of traditional policies

        2. If its not written, then it does not exist. your policy document clearly states what you get

          1. GODFREY CHERIAN says:

            dear manish,
            i checked with LIC today and gave them all the policy details, I was informed that the maturity amount will be around 15 Lacs. I feel cheated, because while taking the policy in 2003 the agent told that maturity amount will be around 20L. (18.5 L to 20 L). the last policy amount i paid was in 2008 with total premium of approx. 10.5 L. Had i invested in some other products, definately it would have been double by now. what is your suggestion. I totally agree with hhegdenaveenn on his quote “stop cheating innocent people of india using words like ‘Anand, Suraksha..etc’. Life insurance is becoming totally meaningless in india due to high inflation. I would say ‘stay away from LIC policies’. Better go for term plans & enjoy rest of your money when you are ALIVE!

            1. Yes .. note that agents just give the approx figure on higher side which is not possible in most of the cases. Right now its better to bite the bullet and make sure you buy things only when you are clear what you will get.

  109. Kamati says:

    Hi Manish,

    I have Jeevan Anand Policy which was taken in 2007 with SA of 5Lakcs. Recently I have gone LIC website with my login then I am able to see some vested bonus against my Jeevan anand policy.

    Can you please through some light on this vested bonus as I am planning to stop this policy from this year onwards as have completed 5 years and will make it to Paid up?

    Please provide your valuable suggestion that will helpful for everyone in this forum.

    Kamati Srisailam

    1. The bonus is declared per year and gets accumulated, which you get at the end of the maturity . So as you will make it as a PAID UP policy, you will get the accumulated bonus also at maturity

  110. Rajesh Sen says:

    Dear Manish

    I have taken a Jeevan Saral policy for no reason as i was looking to take an insurance policy without knowing any thing but after 2 years I got to know that I was wrong.
    I had taken it on NOV – 2011 ,what is the best for me paid up or surrender, My premium is 3000/- PM/ please suggest..

    1. Better surrender it

  111. siva says:

    Hi Manish,

    Thanks for the informative article.
    Following are the 2 policies that I have taken from LIC :
    1) Jeevan Ananad : yearly premium – 25319; sum assured : 500000; policy term: 21yrs; premiums paid so far: 3 (4th one due by this May)
    2) New Jana Raksha: Package policy(10 policies) with the premium of 22.8K per year. only one premium paid so far that was in september 2012.

    Please suggest in what ways I can get out of these without significant loses in future. Either surrender or paid up. Please let me know if I make my Jeevan Anand policy as paid up, what is the expected amount of return i would be getting at the end of 20yrs tenure based on the current and expected inflation percentages?


    1. Make them paid up

  112. Deepesh says:

    Hello Manish

    One of the Lic agent suggessted me a Lic plan(Bima gold Table 179)
    IF i invest Rs 30k p/m then I would get 15% of sum assured(30k) on 4,8,12 years respectively

    And on maturity I would get (8lac)

    If I invest same amount on PPF account even I get the same amount on maturity after 15 years

    so can you suggesst on which plan to invest?

    1. Yes, the agent has said right ,but the question you need to ask is what is the % CAGR return out of hte policy ?

  113. Deepesh says:

    Hi Manish

    One of the Lic agent told me to invest in Bima gold plan(e.g 30k/pa) ,I would be getting 15 % of the sum assured at the end of 4,8,12 years

    and then at Maturity I would get a lump sum around 8lakhs

    I am confused how can 1 predict maturity amount that too after 16 years , is it worth taking this policy?

  114. HI Manish

    I am 25 years old. I have taken a LIC New money back policy of 25 years. every 3 month in pay 1332 rupees and also 5 years completed so please tel how many money me get after 25 years. pls guide me i want another new policy so which is best for money saving.

    1. You cant say an amount like that . Whats writtten in your policy document ?

      1. Money back – 1,00,000

  115. Sudheer says:

    Thanks for your popular book ‘Jago Investor: Change your Relation with Money’ i just got that yesterday. Here i want your guidance, last year in a hurry to save tax i have invested in 10 Lakh sum assured for 28 years LIC saving cum insurance policy. Later, with my seniors i come to know that it is neither giving full insurance nor savings, around 5-6% (No idea about this ). Due to this reason, i am planning to stop paying premiums and save and invest through SIP in ELSS and get a term insurance. If the Jeevan Anand can get me around not less than 7.5% annual return (Considering, even in FDs in long term considering 30% tax slab, returns will be less) i am planning to continue it.

    1. Yes Jeevan Anand can get you around 6-6.5% . If you are not going to invest in Mutual funds , then you can continue it .

  116. Sohil Shah says:

    Thanks for this wonderful article. I just have one query.
    – I have paid 3 annual premiums each of Rs. 60050 for LIC’s Jeevan Saral Policy. Now I am not going to pay anymore premium to the policy. I do not want to surrender the policy as it will just return me nothing. As I have paid premiums for 3 years, it has acquired paid up value. I just wanted to know HOW MANY MORE YEARS it will take so that the maturity value acquires at least the value of my 3 premiums i.e. Rs. 1,80,000?

    Appreciate your help.

    1. You will only get your paid premiums now on maturity . not before that ..

  117. Ajit Singh says:

    And i have given 2 premiums means 72ooo + 72000= 144000. Its not possible to surrender as 3 years not completed. I am 28 and i calcuated on every aspect according to your book. But all comes to a stop with a question- “Can v beleive on the table of jeevan saral? Even till 10 years i am getting around 13lakh and same amount gives around 11 in PPf. Please advice

    1. You can believe the table on jeevan saral if its on LIC website or the policy document

  118. Ajit Singh says:

    Dear Manish,
    I got your latest book ” How to be…10steps”. And the first step made me fall from my chair as i invested my hard earned money on Jeevan saral LIC. paying in two parts 24ooo and 48000/annum(parental pressure). But reading your book i calculated and if invested for more than 10 years its beneficial than putting in PPF for same period. Now the important question-“the table given by jeevan saral for 35 years.can v rely on that”. Please answer.

    1. Yes ,you can rely on that .

  119. Shob says:

    I have an LIC Money back policy which has completed 5 years. Can i stop paying premium’s for this policies? I have received one payment money back. What will be the impact on the returns. I have another LIC Jeevan Saral paid 2 preminums. Want to stop the payment after one more premium instead of closing the policy as i will not get my amount.

    Is it worth doing it and invest the same amount in my PPF account.
    What are the drawbacks if i stop the premiums.

    1. Stop it after getting the next money back

  120. bhanuprakash says:

    I am looking for a good children plans & i have decided to go for LIC children plans.
    please help me to select a plan which can cover my daughters education and marriage.
    However, many say, “Term insurance plan” is good compared to “children’s plans”. Kindly advise, which one to go for.

    Thanks in advance,

    1. A normal child plan will not give you any life coverage which is very important from security point of view, and also from returns point of view children plans are not that great , especially traditional plans from any company . It will give around 5-7% max .

      By combining a term plan and another investment option like mutual funds, or even PPF , you can create a better structure for yourself.

  121. Narinder Tiwari says:

    Hi Manish,
    I have LIC Jeevan Anand policy . I took this policy in 2007 and paying the premium regularly. This year, before paying the premium, I check the surrender value. It was 1,25,890 against the premium I paid 156000 (25974*6). So I pay the premium for 2013 also. I just want to come out from the Policy with no Loss at-least. Do you think, it would be better to continue with this policy in future.

    1. I dont think it makes sense .. The only way you make no Loss is by continuing the policy for long enough, which itself is a loosing proposition . I would say dont get into that mindset of “at least I should get what I paid” . Its just a wrong way of thinking .

  122. Ramakant Chauhan says:

    Dear Manish,

    This year on 21st Jan’ 2013, I took Money Back Policy from LIC (Table 75, 20 yr term) with yearly premium of Rs. 22,949. The S.A. is Rs. 3,65,000. I’ll be getting 20% of S.A. from 5,10,15 yrs of survival & 40% of S.A. + vested bonus after 20 yrs.

    After reading so many articles on endowment & money back, I feel I’ve made fool of myself. I’ve already planned to take 1 cr online term policy from HDFC. But I’m confused about this LIC money back plan. Should I continue with it or surrender it. I never knew that I’ll not be getting anything if i surrender it with in 1st year of taking it. Kindly suggest!

    1. You are in a bad situation now . You will not get any money back now unless you pay 3 yrs premium and even after that you will get peanuts if you surrender back in initial years . it would be really painful , but I think the best thing you can do is forget this and restart your investments .

  123. Rajesh says:

    Hi Manish,

    Iam having few doubts regarding the comparision of LIC PLANS and others.Please take this on a positive note and clear it.
    LIC is 56 yrs old company and has largest market share in Insurance. Incase a person like you suggested not to invest in LIC when it was formed in 1956, where had been the investments made till now.And as per the Indian mentality, i wonder whether so many people saved so many crores of money for longer terms into the instruments which you have told? How many people till now continued the investments in the same instrument continuously for 10 yrs?
    Though the returns or IRR is low.what i feel is a part of the investments should be made in LIC also just because there is a mandate to pay it for longer terms.
    Please correct me if iam wrong.


    1. Yes Rajesh

      There is no issue if you are ok with low returns . Its totally fine . Its your choice . If you are happy with a small insurance by paying a large premium and if you are ok with 5-6% return in long term , then you can invest in any endowment plan .

  124. charan says:

    Hello Manish,

    I am 28 years old. I have taken Jeevan Anand and Jeevan Saral in Feb 2012 at Sum assured of Rs. 5 Lacs and 2.5 L respectively and Premium payment term is 21 years for both policies . I am paying monthly premium of Rs.2190 and Rs.1021 respectively through ECS system.

    Now, i wanted to surrender both the policies and wanted to invest the same amount or more in Gold and PPF.

    I am already having one more policy “Jeevan Shree” of 5.0 L which was taken in 2002 and paying premium of Rs.24700 per year with payment term of 20 years.

    Can you please guide me whether the idea of surrendering Jeevan Anand and Jeevan Saral immediately is suggestable or should i wait till completion of 3.0 years and then surrender the policy.

    1. I would suggest better just stop the policy and do not make any payments further !

  125. Varsha says:


    I had taken a policy in 2011, LIC (money Back after 20 years), But one thing is confusing me i.e how much amount i will get back after 20 years . Sum assured is 3,00,000.
    please reply me as soon as possible

    1. I guess somewhere around 5-6 lacs

  126. Billa says:

    Hi Manish,
    I am 24yr old bachelor and i would like to invest premium of 30,000 to 40,000 P.A…Please give me suggestion which will be better to me.

    If possible please posta copy on mail
    Warm Thanks,

    1. I would say invest in ELSS mutual funds

  127. Nagraj says:

    Hello Manish,

    My self Nagraj and planning for jeevan anand 50 L for 32 years

    Sum Assured : 50 Lakh for 32 Years
    Double Accident Benefit : 50 Lakh
    Premium yearly : 153000
    Returns :
    Sum Assured : 50 Lakh
    Bounus : 76 Lakh
    Final Bonus : 77 Lakh
    Total : around 2 Crore
    I feel 2 crore is good amount, please let me know what do you think.

    I don’t want to invest in Mutual funds at present, but fine with PPF, NSC, RD etc

    Eagerly waiting for replay.

    1. But the life cover is how much ? I guess its only 1 crore ? check how much will you get in case of death . Also why not combine PPF + Term plan ?

  128. Rajasekaran says:

    Dear Mr.Manish,

    I have taken ‘Jeevan Anand’ policy and paying premium of Rs.36000/- p.a from 2012 and ends at 2048, the poilcy details as below

    DOB : 13/07/1989 , Rs.1 lacs sum assured each with total 12 policies in addition accident benefit of Rs.5 lacs and the maturity starts from 2039 and end at 2049, the agent shown me that total maturity value will be received of Rs.44 lacs

    My annual income is Rs.6 lacs and recently i took term insurance for Rs.50 lacs and also decided to invest in PPF and MF

    Kindly suggested whether the policy is viable

    One final question whether the insurance plans should be looked as an ‘Investment Channel’ or a back up plan as in case of unprecedented events.


    1. they should never be looked as your investment plan , insurance is insurance, how can it be investments … Better not go with this option. Its too complicated and do you know what is the IRR of the whole setup !

  129. Munesh Kumar says:

    Dear Manish ji’
    I have taken money back policy-25 years (table 93 plan) starting from 28 jan 2012
    till now i have paid 3 premium of Rs. 25898-/ half yearly. according to policy they will pay me 1.5 lac at the 5th,10th,15th,and 20th .can u tell me plz what amount will i get at the maturity period (i.e. after or at the end of 25 yeras) . now i m very confused , now i think that i am paying more what i will get at the end. should i carry this policy or drop out plz guide me. i am 24 years old.

    1. Check out which policy is it and on the LIC website it must be clearly mentioned how much will you get at the end .. Mostly in your case you are getting 15% in money back each time and rest 40% at the end.

      1. Munesh Kumar says:

        if i want to surrender this policy what is the right time so atleast i dont loose any money what i have paid.

        1. then you will have to continue the policy .

  130. Nitin Shimpi says:

    Hi Manish,

    I have gone through your article. It is really helpful for me. Today I have taken LIC jeevan saral plan policy. and after that I saw your article. please advise me is this polity beneficial for me. my annual premium is 24k. for 20 years. If this is not good policy so which policy should I get?
    I am married person so I want policy like which can give return for future as well as insurance cover. please advise me. I am now count on your advise.

    1. I would say give it back with in your freelook up period of 15 day !

  131. Ekaveera says:

    Hi manish, Thanks for the nice Explanation on LIC basics. I Really like the math involved in it. Can i get any math problems on these LIC related stuff, so that it will be more clear. if you have any link or book please share it.

    1. I am not aware of any issue like that

  132. Venkatesh says:

    Hi Manish,
    This article is eye opener. Thanks for the informative article.

    I need a clarification on surrender of the endowment policy.
    Can we surrender the policy while we are paying premiums?. or Can we Make the policy Paid up and then surrender it.

    Which option would give me better surrender value?.

    Thanks and Regards

    1. Venkatesh says:

      Policy details… I have paid 10 years of premium 10,000 each year.

    2. You can surrender anytime after 3 yrs .. Surrender will always give you less money than you paid .

  133. Sheetal_p says:

    Thank you for this post!

    This has certainly cleard the doubts that was lingering on my mind when i paid annual premium of my three LIC policies early this year.

    My father had opened these policies for me some 7 years back. I have three Money back policies with different maturity periods – maturing at 15, 20 and 25 years period. Total Annual premium i have been paying is 28,390. I had never seen the policy docs since my dad started up this for me. I was of the opinion i would get atleast 8 lacs at maturity considering the annual premium payment. Couple of days back I saw the policy details and was shocked to find out that the total Sum assured for these three policies comes upto 4,25,000. made no sense to me at all.

    I am a huge fan of PPF. I immediately opened the online PPF calculator which showed that if I invest 28,000 every year in PPF for 15 years, the maturity amount will be 8.65 lacs.. A suerty that my investment doubles in 15 years. LIC policy does not even give any indications on accrued bonuses on an annual basis. What a waste it is.

    Lastly, please advise if it would be any beneficial to make these policies as paid up after 7 years.

    1. I think your Bonus will also be there , not sure if you looked at it or not .. you should expect around 6-8 lacs if the sum assured come around 4.25 lacs ..

      However PPF is a better option I must say !

  134. Monica says:

    Hi Manish, thanks for the good article. I’ve not quite understood (or rather have many doubts on) the loan repayment procedure for LIC policy. Can you please explain the following
    1. My agent told me interest rate is 10.5% and interest needs to be paid half-yearly. Say, if i take a loan with a pay-back period of 3 years, will the interest amount be the same for every half-yearly payment cycle or will it be compounded
    2. The agent also told me, I can pay back the loan amount in part or in full at any time during the period of 3 years. Is that true?
    3. In that case, will the interest amount for next 2 years be reduced if I made a part-payment in the end of the first year
    4. The agent also told me if I choose not to pay the loan amount I can do so and the amount will be deducted from the claim amount. Wanted to check if it is that simple as it sounds or will it have any hidden effects to the maturity amount itself

    1. Monica

      I am not clear on LIC loans .. please open a thread on our forum to discuss this, and surely you should get an answer –

  135. hi Manish ,

    very nice article , you have explain it in details , i never get the such detail information from LIC agent. thanks a lot manish

  136. i have gone through this article and found what you are presenting is JUST FALSE and ANNOYING i initially thought it is useless to comment THEN I REALISED as an AGENT WITH LIC it is my duty to respond………… I POSITIVELY HOPE you are not paid for WRITING AGAINST LIC ………. ………… please refer to the link given below which is self explanatory. INSURANCE as an investment is different, you can not just compare any other investment with INSURANCE ……. ( YOU CAN NOT COMPARE oranges with APPLES ) ……….. and when we sell INSURANCE we sell a long term contract to the client and hence there is no point in calculating or worrying about surrendering. I REALLY PITY THOSE AWAKEN CLUB MEMBERS ……..going in to FOOLS PARADISE by paying FEES ……… JAI HIND…… I REST MY CASE and i further not interested to know what is your response………

    1. Thanks for enlightening us .. please point out the false statements in the article, so that we can correct it . thanks for your support . Investors community is really looking for agents like you, who are ready to point out the mistakes ! .. thanks once again

    2. Indian says:

      Manish is right,
      @chandramouli kalyanachakravarthy — you are simple IDIOT..not accepting facts…and selling useless loot the people.

    3. Rajesh says:

      Dear Mr. Agent,

      It is understandable that the article is ANNOYING to you, but please do point out what exactly is FALSE.


  137. Aisha says:

    Hi Manish,

    I am 26 and want to take some good tax saving investment policy..My annual income is upto 3 lac.Please guide me which one will be the best for me.

    This will be my first investment/policy ever.

    hoping to get some good suggestions..


    1. What kind of risk you can take on your investment and what is your future goals ?

  138. thamaka says:

    Hi Manish,
    I need an info regarding loan on LIC policies. If I take loan from existing LIC policies, will it reflect in CIBIL report? I am planning to go for Home Loan. If I take loan from LIC policies before taking Home Loan will that affect my eligibility on the Home Loan?


    1. Yes . It should be reported . Note that if you are paying an EMI on it , its going to be reported . Even though its a secured loan, still its going to build your repayment record.

      1. thamaka says:

        Hi Manish,
        Thanks for the reply. For the LIC policy loan, there is no monthly EMI like personal loan. I have to pay just interest for the principal amount half yearly. I can repay my principal amount When I get some money.

        Since there is no EMI, will it get reported to CIBIL?


        1. hmm… This is tricky then .. Any kind of secured loan should also be reported to CIBIL , just like a secured credit card or secured personal loan does . Now LIC is not a NBFC , but can give loans as LIC policies as security . So I am now not sure if it will report to CIBIL about it, But if a bank gives you loan on the basis of your policy , then it will surely update CIBIL about it .

          1. Vishnu says:

            Hi Manish/Thamarai,
            I’m in same situation. I’m going to apply for home loan and I want to get loan on my LIC policy. I want to know whether home loan eligibility will be reduced, if I take loan on my LIC policy. If you already went for loan, please update me what happened in your case.


            1. So you take loan on LIC policy and tell the bank that you want lesser loan from them . I am not sure what is the issue here ?

  139. Ranjeet says:

    Hi Manish,

    last year I have taken Jeevan Saral ATM plan policy . Details are below

    DOB – 16/09/1985
    Premium Amount – Rs. 15,925 Qtrly
    Date of commencement of Risk 28/06/2012
    Date of last payment 28/03/2033
    date of maturity ( First Policy)- 28/06/2033
    S.A – 12,50,000.

    Actually I am confused whether i am investing in good policy or not. Agent had gave me 13 policies . Each Policy have different date of maturity, last maturity date is 28/06/2045. Please advice shall i continue this policy or not. In case I continue this policy how much Interest I will get. also let me know what other Investment can i do ??? Awaiting for your prompt reply.

    1. the policies which you have , do you know about the maturity return in terms of percentage ? I want you to do the IRR analysis which is explained here –

    2. Indian says:

      I am sure that your agent had misguided you…
      If you invest same amount in PPF or even in NDC Bonds… you will get at least 30 – 35 lakhs.

      It would be better for if you stop paying premiums from today itself and also forget money what ever u have paid till now… and put your hard earned money in to some other investment options…like PPF or NDC Bonds or Post Office ..etc.

  140. Ajita says:

    Hi Manish,

    I am a 26 years old fixed salaried employee. I recently took two LIC policies to avert ITax. However, I am realising now that I might have been duped by my insurance agent.

    1. LIC Jeevan Saral, premium 24,500 per year for 35 years &
    2.LIC Jeevan Anand, premium 21,324 per year for 25 years

    So far I have paid two premiums only. If I stop both of them I would loss Rs. 22,912.00

    Therefore, I have decided to discontinue with the Jeevan Saral Policy and to carry on with the Jeevan Anand Policy.
    What is your view?
    A really honest, no matter how much brutal, reply is really appreciated. Thank you.

    1. All the LIC policies need to run for atleast 3 yrs , else you loose everything . i am not clear why do you want to stop Jeevan Saral and continue Jeevan Anand ? Also a big mistake which I can see you have done is to save for a tiny income tax money, you have put a big amount at stake .

      1. Ajita says:

        Hi Manish,

        Thank you very much for the reply.

  141. Ashok says:

    Hi Manish,

    My Jeevan Saral policy is for 15 years for 5 lakh. Started from 2008, paying 25000 yearly premium till now total premium paid is 1.25 lakh. If I go for paid up from this year onwards, could you clarify me what is the lump sum I will get when reaching the maturity period. How the calculation will be? during paid up period, will LIC make any charges or cut something in any other way from the amount I paid?

    Thanks in advance!

    1. You will get your paid premiums at maturity + bonus accumulated till date !

  142. Arvind Salvi says:

    Hi Manish,

    I had “Twenty Year Cash and Cover Policy with Profits(With accident benefit)” policy from LIC. Policy details are as follows:
    LIC policy No. :18309679
    Policy term: 20 years
    Commencement Date : 02-JUN-1977
    Last Premium Date : 02-MAY-1997
    Sum Assured : 10,000/-
    Premium amount : 45.40/- monthly
    I got survival benifit every 5 year @12.5% of the sum assured where as I completely missed to claim the maturity benifits (Maturity amount) of this policy which got matured during JUNE 1997.
    Would like to know the way to get the status of this policy and how to get the matured amount.
    Request you please guide me.

    1. Incase of cash back plans , at the end of the policy you get a small amount because of the money back . Did you check your policy brochure ?

  143. Srinivas says:

    Hi Manish,
    I took Jeevan Anand LIC for 20 years since 2003. I am paying 52,843 for every 6 months. Upto now, totally I paid 10 years. I don’t want continue with policy.
    could you please advice me?. Should I surrender my policy ? policy itself continue further 10 years?
    please advice me

    1. Make it paid up if you are not hard pressed for money !

      1. Srinivas says:

        Hi Manish,
        thanks for your answers. How much Should I expect after completion of my preminums (20 years). Agent saying that I might get 50 + 20 = about 70 lakhs (maturity benifits, etc)
        please let me know.

        1. I seriosuly doubt .. you will get your sum assured + your bonus . Thats all .. so just check what is your sum assured , should be mostly equal to the total premium you pay . And regarding bonus, its generally 50-55 per year , so another 10-12 lacs for a 20 yrs tenure . So at the end , you should not expect more than 5-7% in total on compounded basis

        2. And the best thing would be to ask your agent, how he arrived on that 70 lacs figure ? Also ask him best and worst case and also ask him to do it as per the information given in the brochure

  144. Vivek KM says:

    Hi Manish,
    I have taken 2 LIC Jeevan Saral policies, one in my name and second in my wife name. Both policies have the same commencement date.
    After reading the forums and other notes on this I am really confused as whether I am investing my money in wrong product of LIC.
    I have a loan of 50L for which I am paying the EMI from 26-Feb-2013. I got attracted from the table that LIC agent presented me, like in 10 years my money was getting doubled.
    Can you please advice what should I do now, continue or change to someother plan. I need to pay my loan so kindly advise something which is beneficial to me.
    Apart from this I have Birla Life insurance for which I am paying premium of 15K annualy and getting 40L cover.
    For LIC policy:-
    My DOB: 02-Jun-1980
    Commencement Date: 24/05/2011
    Policy term: 30 years
    Premium: 60650/- payable Half Yearly
    Sum Assured: 2500000/-

    Many thanks for your advise.

    Vivek KM

    1. Vivek

      Can you share what was the attraction point for you in that plan ? Money doubling in 10 yrs ? What is the attraction in that ? You can make that happen in 8 yrs in FD ! . Do you know what is the percentage return you will get in your policy , if you do not know that it means you have no analysed it yet .

      1. Vivek KM says:

        Hi Manish,

        That was the big mistake I really did and now I am realizing it. He gave me a paper where a table was printed with projection value of 10%(he said it will be more and other stuff and if I continue this policy for long I will be getting more than double the value). The lucarative thing was from 11th year onwards if you continue the policy the money was adding in a large number, I think addition on 2-3L per year, so that thing attracted me :(. I have that sheet, do we have any place where I can upload that.
        At the end of 10th year I would end up paying 120000/- and as per the table I was getting return around 24L or more.
        I am not sure what is the current percentage that LIC is giving on maturity of the policy and I have discussed with many folks from insurance and they are unaware of this.

        I request you to please advise me what should I do?

        Vivek KM

        1. Those paper has no significance . Its just a illustration which agents give . IRDA has clearly said that agents can give illustrations with 6% and 10% assumption. However in reality anything can happen . Your policy document clearly mentions how much you will get and on what assumptions . Wheather it will be 6% at the end or 10% would depend on the kind of bonus LIC declares each year. Its seen that in general its hardly matches inflation in long run.

          If you have already passed 3 yrs of policy, better make it paid up now and stop paying any further premiums . This is the best you can do right now.


          1. Vivek KM says:

            Do you mean to say, I should stop making payment to that policy on completion of 3rd year. So in that case can i get my money back, if not full than how much I can expect.
            What do you advice where I can invest my money, any other policy/FD/equity/MF etc.
            Can you plz be more clear.
            Thanks, Vivek KM

            1. If you have not yet compelted 3 yrs , the best you should do is stop the policy all together. If you have a moneyback next year itself, then check if you will get more than the premium paid or not .

      2. Anil kumar says:

        FD makes money double in 9years 9 month and doesn’t has life risk cover and no tax benefit…..and if interest is more than 10 thousand an additional tax levied…

        1. At what interest rates ? and what about the liquidity point ?

  145. Foram says:


    Manish, its a good article. Helps people understand how LIC policies work.

    Would just like to say that people have different requirements. You may say LIC returns are only 5% but pls provide me with a better proposal. Equity may give you 20% return in a yr but someone who is not very financially savvy as you are may lose out all their hard earned money.

    LIC provides very good risk cover on life which should be considered while doing a financial planningand the entire idea of 20 yr term is to have a regular saving.

    as rightly mentioned by Chiraag Bhojwani, Jeevan Anand does provide good risk cover.

    If you are against insuring, does not mean other should do the same. Pls do consider their needs and requirements before advising them against LIC. You are mis-guiding the investors who are looking for help and advise from you.

    1. Forum

      Thanks for your views .. Lets say a person has a requirement of 1 crore sum assured . Please give me what will you suggest to this person ?

  146. Manjunath says:

    Manish, i have a Money back policy of annual premium 31000, already paid 3 premiums and have to pay 4th yr premium now. I am no more interested in policies as a whole after calculating the returns and for longer durations as Life is very short. Now should i pay another 2 premiums and get the first 20% back and make it Paid up or simply forget already paid premiums.

    1. Which means you will pay 62000 in next 2 yrs . How much will you get back overall as 20% and also while surrendering ? It might make senses , just do the calculations once !

  147. Ashok says:

    A simple tip for all you guys,
    LIC is good If you go for minimum maturity periods, most of the policy has minimum of 5 years maturity. Stick to this decision to take a policy for only 5 years even then your are stressed by an agent to take the policy for 20, 25 and 30 years, this is because they want to enjoy the commission for such a long time. Think about it, just 5 years time will allow you and some how you can pay for 5 years and finish it off, It is better instead of taking policy for a long time and suffering unable to pay to reach the maturity and thinking to surrender this will lead you to loss your money. Do not surrender the policy, just take for 5 years and pay only for 5 years, after policy is matured you will enjoy the money you paid + bonus from LIC + risk coverage.

  148. Guruprasad says:

    I have paid premiums for two years in Jeevan Anand policy. Will I be able to avail loan on policy?

  149. ritesh says:

    Hi Manish,
    Query on Life Insurance, all policy from LIC
    1) Jeevan Mitra (since 2004) Premium Rs 10516/- (2 lac cover= maturity 2026)
    2) Bima Gold (since 2005) Premium Rs 7774/- (2.2 lac cover= maturity 2025)
    3) New Bima Gold (since 2006) Premium Rs 8345/- (2.2 lac cover= maturity 2026)
    4) Whole Life Policy (since 2008) Premium Rs 61804/- (5×4= 20 lac cover = premium paying till 2044 maturity 2058.
    I had previously ULIP’s which I have cleared almost with little loss 1 year back.
    Now my total policy above is 26.4 lacs and total premium Rs 88,349/-. My query is
    Should I surrender my policy, I will take a loss of 59% for all my premium paid,

    1. Better make your policies paid up now ..

  150. Ankit says:

    Hi Manish,

    My father in law had taken a 20 years money back plan in May 1997 and regularly paid premiums till May 2011 (15 premiums). But he did not pay the May 2012 premium for reasons best known to him only. Unfortunately he expired in Dec 2012 (accidental death). Should nominee be getting any death and accidental claim benefits from the policy. ( It also seems he already received 20% each at the end of 5 years, 10 years and 15 years from the policy commencement).



    1. Obviosuly NOT .. The policy is as good as STOPPED , he will only get the Surrender value now which was as on that date when he died.


  151. Praveen says:

    Hi Manish,

    I have paid 2 year premium. One of my friend advised me take 1st money back and stop premium. He told it is more profitable that surrendering or making it paid up after 3 years.

    Please advice.


    1. Yes, if your first money back is due in just 1-2 yrs ,better take it and then make it paid up

  152. Hari says:

    Dear Manish,

    My hearty congratulations and appreciations for your guidance!
    I want your help in making a decision in respect of my jeevan anand policy. The details are as follows:
    I have taken 19 policies (Rs 100000 each) for Sum assured of Rs 1900000 of Jeevan anand with profits and accident benefit. The total Premium is Rs 50097 payable annually. The policies starts maturing from 28-Jan-36 to 28-Jan-54. Start date of the policies is 28-Jan-2009. Date of Birth is 15-Sep-1981. I have paid 4 premiums amounting to Rs 200388. The current premium is due and also I need to submit my investment declaration by this week. I am in a dilemma whether to continue with Jeevan anand or surrender. Please guide me. Also please let me know what are the other alternatives.

    1. Your situation is bad overall .. you at at a juncture where you will face the maximum loss. Surrendering the policy now means taking the maximum loss, but continuing the policy also means a big loss in terms of getting very low returns ..

      1. Hari says:

        Many Thanks Manish.Would surrendering JA now and taking a PPF + term policy help me reduce / cover the losses in the long run. Please advise

        1. yea thats a right decision . go ahead !

  153. Ramya says:

    Hi Manish,
    Thanks for your wonderful post!

    I have a question on Jeevan Saral policy.

    Does the loyalty addition declared in the policy is not guaranteed ? Is it possible for you to explain the disadvantages of Jeevan Saral. I totally agree that Mutual funds gives more return on investment but do we have some valid points which totally defer opting for Jeevan Saral. My intention is to showcase the disadvantages of Jeevan Saral as an individual policy (and this shouldn’t be done by comparing it with Mutual Funds in which the latter always benefits).

    1. Its guaranteed .. In policies you will see something like Rs 50 per 1000 sum assured of loyalty addition . The disadvantage is simple .. low returns, not liquid

  154. Aarti says:

    So Manish per your article, are you suggesting not to invest in LIC and invest in others? and what are those?

    1. NO thats not my suggestion . the decision has to be taken by the person who is investing . If he/she is ok with the returns, liquidity and other points of any policy, then she/he can invest..


  155. Karthik says:


    My policy term is 77 and premium paying term is 17. My SA is 10,00,000 and I am paying ard 63,000 per annum. I am really confused about the policy term and premium paying term. When will my policy mature? Is it after 17 years?
    If that is the case what is policy term? And what will be the amount after maturity?


    1. No , it will be 77 yrs !

  156. Sandeep says:

    Hello Manish,

    Nice article !
    I also have LIC moneyback policy started in 2004.
    SA: 250000
    Premium: 15767 (yearly) due in March every year.
    Moneyback: 50000 (i.e. 20% of SA every 5, 10, 15 yrs)
    This year premium is still not paid. My plan is to surrender this policy after paying premium next yr 2014 i.e. 10th yr so that I will get moneyback benefit. Policy copy is not with me now but as per website ( and ofcourse mentioned by you, 30% of the basic premiums will be paid (excluding 1st yr premium & all survival benefits paid earlier).

    Whats your view? should I surrender now or next yr after getting moneyback? (ofcourse for that 2 premiums have to pay)
    What in case of paid up option? (didnt see any option on website)


    1. Better make it paid up !

  157. B Deka says:

    Manish is absolutely right. In my opinion we should no take Life insurance policy as a means of investment. Because what we shall get at the end of fifteen or twenty years will be very less for us to serve any purpose. We should open life insurance policies for taking risk coverage only. And term policies are best for that.

  158. Basudev says:

    So far I understand Manish is absolutely right. In my opinion people should open LIC policy for risk coverage only, not as an investment and term polices are best for that.

  159. Anand says:

    Hi Manish,
    Thanks for the article. It is very good one to understand the LIC policies.
    I have below question.

    My father has taken Jeevan Mitra policy in Oct 2000 for SA 80k with premium 2070 per quarter for 15 years, and Endowment assurance policy in Aug 2004 for SA 2 lacs with premium 2155 per month for 9 years. He is 58 years old now.

    Should he continue paying premiums or surrender them?
    Please suggest what can be done.

    1. If its just 2-3 more premiums, let me complete !

  160. KRish Nals says:


    I`ve 2 policys Jeevan Anand and Jeevan chaya) of total 30K permium per annum started from 2008 and paid 5 yrs of premium already. I got the awareness of term insurance(and the probable returns after 11 years from now i.e after maturity) which isnt that good even as of a PPF or NSC will give.

    So decided to make it paid up. I`ve taken 60k of loan(now i realised the load interest is increased from 9% to 10% by LIC). I am reapying it. I wanted to make both the polices paid up.

    My question is :
    I`m planning to complete the loan shortly.
    Also at same time i can stop my premium payment due from next month., will this automatically make the policy as paid up? or LIC has something to ensure this is made paid up(any document for saying it is paid up). Because when i say to my agent i`m making it paid up, he says dont. But i`ve made the decision. So will stopping premium will make the policy as paid up now ?

    Thanks for your help in ad.


    1. While stopping the premium makes it paid up , its better if you just mail them saying that you want to make it paid up !

  161. vinod kumar says:

    Hai Manish

    I have taken lic policy jeevan saral 1 year ago my age is 26 year agent ask me it give me 10% of return i want to know about current return of of this policy

    1. You should understand that LIC policies are highly illiquid .. so right now if you want your money back , you will loose a big amount .

  162. Rakesh says:

    Dear Manish ji
    a agent from SBI Life shown the calculation of the reversionary bonus given by the SBI Life is @6% of Sum Assured(SA) to say for 15yrs term & SA 5lakhs will be paid at maturity
    will be 5lakhs plus Bonus 4.5 laks=9.5lakhs
    is it justifying? Official website is showing the reversionary bonus amount is 168000
    they are not showing the process of calculation
    could please explain their process


    1. What is givin in official website will be final . Ask from sbi customer care on that or ask on your forum

  163. Sukomal says:

    Manish, I have ICICI pru whole life policy, which was taken by mistake in Jan 2011.. Now I dont want to invest any more in this as I paid min lock in period of 3yr. However if I withdraw the money , I see i will get very less amount not even half of my total premium paid. Now i am thinking to keep this policy active without paying any premium. do you think i will at least get the money that I paid for after 5year or 10year(which is matured year)..

    1. Yes you can get that. but how does it help ? If you get the amoutn you paid after 10 yrs , how does it make this investment great .. Its just a way to boost your inner ego 🙂 .. that you didnt loose. . if you get 50% now , put it in FD and in 7-8 yrs it will be 100% .. the same thing which you want from the ULIP

      1. Sukomal says:

        Thanks for such a clear thoughts.. you are doing really great man 🙂 hope more to come in your site…

  164. vikas says:

    Hi Manish,

    Was just going through your article, no doubt it is really an informative article.

    please let me know if there is any thing called additional bonus on LIC premium, yesterday I got call saying he was talking form LIC, he asked me whether I had received any bonus till the time or not when I said no, he said agent actually mention there code so that they receive the bonus, they he asked em about the premium amt, I said over all for my family I have around 70-80k as premium, then he told me I should receive around 2 Lakhs as bonus in march13. he would provide me the code which I would need to give his boss when I receive call again, till now I have not given him any details except my address which he already had.

    the most weird thing was he said do not discuss the same with your agent else he would change the code again and you may not receive the bonus amount.

    I doubt if he was from LIC, though I am unable to contact any body in LIC as there call center I believe doesn’t work.

    1. I believe he was some LIC agent, and was trying to pursuade you to change the agent code somehow through his tricks . Dont get into that kind of trap … There are policies where FAB can be there which means FINAL ADDITIONAL BONUS , but that is given at the end and depends on LIC at the end.

      1. vikas says:

        thanks manish, even I was wondering how could a person tell the bonus amount without even asking the policy names. Also I have no policy which is maturing in the neat future.

        thanks for clarification, let him call back, will take care of that person.

  165. Sharad says:

    I have taken LIC’s New Bima Gold in Year 2007 and have already paid 6 premiums. After reading your article, Now I have decided to stop paying next premium which is due in this month only. I have also taken term plan of 50 lacs this year, that will cover my insurance part.
    Manish, I would be highly grateful to you if you could suggest whether I should surrender the policy or leave it as it is without further paying the premium?
    Thanks in advance.

    1. I think you can make the policy as paid up now .

  166. Ishwar says:

    Dear Manish Chauhan :

    Dear manish thx for providing insurance details its helps us to select insurance. I have one query i want to buy policy for my daughter (8 months) which policy is better for her future. As per my knowledge i am going for LIC Child career plan(no184) or LIC child future plan (no185). I am not believing other MNC insurance like ICICI,Max neyork,Bajaj etc.

    Please you choose which policy i have to take for my daughter plz.

    I can spend yearly premium up to 15000/-

    Plz suggest


    1. We do not recommend any “policy” . Better go with simpler products like FD , PPF etc .. Or you can invest in Mutual funds . take term plan to secure your life insurance


  167. ravi says:

    Sir,I just received a phone call from a person who claims to be from IRDA delhi office and they say that I am a beneficiary of additional bonus from LIC and to claim for the sale I should invest RS 25000/-in Reliance Insurance and the IRDA office shall clear my cheque for payment of Additional bonus against my policies.
    Kindly suggest if there is any scheme of this type.

  168. raghavendra nayak says:

    lic policies offer security and protection in case of any uncertainities such as death . imagine a sole bread winner of d family dies. his family has no where to go. with a life insurance policy to a certain extent d family can continue to carry on with dignity and pride. so lic is a must , whether a term or endowment. comparing the returns & doing arithmethics in insurance is a poor bussiness. a responsible person will least do that.

    1. Yes, agree ..

      Can you tell us how much will a 50 lacs Sum assured endowment policy cost as premium per year ?

  169. Asif says:

    I have purchased Jeevan Sanchay policy of Rs 75000/- in Feb-2000 (at the age of 23), for 15 years. Premium amount is Rs 6945 yearly and all 13 premiums are paid.
    I got 18750 twice (in 2005 and 2010). Now I want to know my maturity amount in Feb-2015. Kindly give reply as soon as possible.

    1. Better talk to your agent , he will be able to tell you that

    2. bmkumar says:

      Hi asif,
      I also took the same Jeevan Sanchay Policy from LIC in May 2001 for Rs.1,00,000 SA. I also received 25% of SA ie., Rs.25,000 in May 2006 and May 2011. Wanted to know how much you got on maturity (ie., during Feb 2016)
      Manish Kumar

  170. madhu says:

    Hi Manish,

    I have a LIC policy taken way back in 2001 [ Jeevan shree -I],
    I pay about 24500/- Per year and PPT is till 2016.

    Can i get a Loan on this policy as Housing loan, if so how much as i have only 3 premiums left to pay?
    My Policy Maturity year will be in 2027.
    My agent informed then i will get about 18L by 2027.

    Thank you.

    1. You can get a loan, but not “housing loan” per se .. better talk to LIC on this

  171. Abhijit says:

    Hi Manish/All,
    Thanks for the information about these policies. Now in case of me there is some immediate advice needed. I have a policy called Jeevan Rekha (152) for 25yrs, started in Jan 2005, renewal premium is due just after 18 days from now.
    Sum assured is 2 Lacs, yearly premium is 7253/-
    Question is if I make “Paid Up” that means stop paying the premium from this year itself (considering I have paid 6 premiums already & received 20000 as money back once). Whether I am to get the sum assured at the end of 25 yrs? Am I going to get the money back of 20000 after every 5 years? Should I really make it “paid up” or surrender completely? I saw some answers as “paid up” & few answers as “surrender” little confused. No immediate need of money for me right now.
    Waiting for your advice & guidance….

  172. satheesh says:

    Hello Sir,

    I am new reader of your blog. I am 25.

    I am confused with the term sum assured ?

    I thought that they will provide the below two sum of money at the end of policy term .
    1)Value mentioned at sum assured column.
    2)The premium paid during the term.

    Plz educate me .

    Because of TDS, i have invested in LIC. 1 policy paid for 1 year & other policy is started for 1 month.

  173. RaviD says:

    Hi Manish

    Thanks for sharing this info through, esp when this entire process of the premium to return ratio is pretty convoluted with LIC.

    I want to enquire about the Jeevan Anad policy I registered back in Aug, 2008.

    The details are:

    Policy Name: Jeevan Anand (T. No. 149)
    Sum Assured: 500000
    Policy term: 75 (premium payment term: 16)
    Annual premium: 34801

    I have till date paid 5 annual premiums of Rs 34,801 each. Just want to check with you if this policy is due to mature on 21-Aug-2024? Is this correct?

    I am not really sure how much this policy could get me at maturity but I am already thinking of having it “paid-up”. I ll check with my uncle (apparently the agent as well) on helping me out with that.

    I have this policy registered on but I am unable to get any bonus information on that portal. Could you also please guide me on how to check this?

    As far as other investments go, I have invested in ULIP (Birla Sun Life) – isnt really doing well after having paid the 5th installment just now…….
    and also invested in Mutual Funds: ICICI Prudential – going far better than the BirlaSunLife one.

    I might just look to close the ULIP plan next year after I finish the 5 year tenure on that policy.

    But could you please guide me on how to go about the LIC Jeevan Anand policy?

    Many thanks in advance,

    1. It would depend on your choice of tenure, for how long you have taken the policy for ? Also you are not seeing bonus info , because generally only after 5 yrs of existence the policy has some bonus. I suggest making it Paid up !

      1. RaviD says:

        The premium payment term for this policy is 16 years, and I bought it back in Aug 2008. I called up the customer support helpline and was told I have a bonus of around Rs 84000 on this policy till now.

        1. But that 84,000 is future value, I mean if you surrrender the policy , you wont get 84,000 , you will get a reduced version of value in today’s terms .

          1. RaviD says:

            So I ll go for the paid up option on this policy.

            Thanks for the comments, Manish.

      2. krishna says:

        will stopping premium will make the policy as paid up now ?
        I was tinking LIC may give some policy doc for stating it as paid up.
        Thanks for your help in ad.


        1. Stop premium = PAID UP

  174. Prashant says:

    Hi Manish,

    Which is good LIC policy for 63 years old person.


    1. Is your requirement of Pension ? getting a regular income ?

  175. Sri says:


    I have jeevan anand policy for sum assured of Rs. 10L for 20 Yrs. Till now paid 3 premiums. Is the Paid-up method applicable for me? If yes, could you please explain the pros and cons in detail.

    1. Yes , you can make it paid up now .. you can read the article to understand what it means

  176. Anand says:

    Informative article… Appreciate the explanations. For me, only term insurance makes sense. All other insurance policies are just marketing gimmicks if we think sensibly and mathematically too.

    1. True ! , we think alike !

  177. Rahul says:

    Hi Manish,

    Just a little query..

    suppose my monthly take home is 47k, Then what is the tax amount. Also as i read all our posts overnight 🙂 I thought that i will take up some things like:

    1) NSC
    2)Mutual Funds
    3)EPF account
    4)Term insurance

    Can you tell me if its right choice.. Also does term insurance covers tax benefits

    1. Rahul

      There are other elements to be considered while computing your tax. DO you know how to compute it or not ?

      Also term plans come under tax benefits in 80C !

  178. prashant says:

    Dear Sir,

    I like to the details of JEEVAN ANAND policy. i can pay annual premium approx. Rs.5000 for 15 years.

    please let me know the features and benifits of Jeevan anand

    1. Prashant

      The benefits are mentioned here at . If you are happy with the returns, you can go ahead . Just make sure you understand all the features and how it works . We generally suggest that one should not get into endowment plans for long term investing !


  179. Debopam says:

    Hi Manish Vaiya, I have taken Jeevan Anand Policy of SA 3,50,000 for 20 yrs term at yearly premium Rs. 19,086. The Date of commencement is 02.10.2012. Can I change its term to 21 yrs?

    1. No you cant change it like this

  180. Nayaz says:

    Dear Manish,

    Need some advice since i am not getting it from my LIC agent.
    i have a 40L jeevan anand policy maturing in 2020. I have paid 6 premiums so far of about 3.5L each and took a loan last year to pay the premium. i paid them interest this year too. Now i wish to stop paying completely and make it a premium paid policy.
    a) do i need to clear this loan?
    b) if i don’t clear this loan will i be charged interest each year until 2020 and will this be eventually deducted along with loan taken from maturity value +bonus?
    c) can i reduce term and policy value to have this policy mature in say 2013? is this possible?( my agent says both cant be done and one or the other only is possible). And if this is possible will i lose anything at the end of 2013?

    This is all so confusing and i asked LIC for a clear picture in writing and yet to receive a response after 10days!
    what is your advice? thanks

    1. a) The loan has to be cleared by you , otherwise it will be deducted from your policy worth itself . Assume when you get the policy proceeds and your worth is X in the policy, and your loan with interest has become Y , then you will get X-Y

      b) Dont you think this is obvious , if you take a loan , it charges your interest each year , nothing to tell in this

      c) Thats same as Surrender , the policy is maturing in 2020 , now you cant change it , you can just surrender it in 2013 if you want, I can only imagine your state of mind when you will come to know how much you will get from your policy if you wish to get all your money back in 2013 , I can pray for you .

      I can see that you have operated all these years without understanding the impact of your actions . Try to make sure you never do it in future .

      Ask your agent and LIC abotu the number which you will get in 2013 if you want !


  181. Rahul says:

    Hi Manish,

    I am planning to purchase a life insurance policy (preferably from some government companies like LIC, SBI etc.) and invest some money in mutual fund. Can you suggest me any good plans. I am looking for cover of 30 lakhs+ and yearly premium of around 20K.
    I am not a citizen of India. So what are the provisions in the law, and will that cause any hassles while claiming?


    1. I am not sure if you can buy it then ? Are you NRI ?

  182. Abhijit Dey says:

    Hi Manish,
    I am 23 years old…I am new to investment world…I want to invest 30000/year on LIC Jiban Saral policy for 15 years term…from your article I came to know that it’s better to invest in mutual fund….but as I want risk coverage so initially I want to invest on LIC Jiban saral policy…can you give me a approximate calculation that how much money I will be get after the maturity (including IRR)…and I am very much interested to invest in mutual fund…can you please suggest me any site or book from where I can get some knowledge .Please give me some advice if you find time.Thanks in advanced for your advice.

    1. Why dont you take a term plan seperately then and cover your self , and invest the rest of the money into mutual fund

  183. Abhijit Dey says:

    Hi Manish ,
    I am 23 years old…I am new to investment world…I want to invest 30000/year on LIC Jiban Saral policy for 15 years term…from your article I came to know that it’s better to invest in mutual fund….but as I want risk coverage so initially I want to invest on LIC Jiban saral policy…can you give me a approximate calculation that how much money I will be get after the maturity (including IRR)…and I am very much interested to invest in mutual fund…can you please suggest me any site or book from where I can get some knowledge .Please give me some advice if you find time.Thanks in advanced for your advice.

  184. MAGESH says:

    Hi Manish,

    Is FAB applicable for the Jeevan Anand policy? Also, the FAB listed above seems to be stale. The LIC has published the updated list in the LIC website. Can you please clarify me.

    Magesh S.

    1. Magesh

      I am not sure if JA has it . Some policies give you at the end

  185. MAGESH says:

    Hi Manish,

    Is FAB applicable for the Jeevan Anand policy? Can you please let me know how many years minimum required for the FAB to be applicable for Jeevan Anand?

    Also, the FAB listed above seems to be stale. The LIC has published the updated list in the LIC website. Can you please clarify me.

    One more question, if we apply for loan in Jeevan Anand after some years, how much is the interest rate the charge for the borrowed amount?

    Magesh S.

  186. Gaurav says:

    Hi Manish,

    Thanks for your valuable advises.

    I need some advise on my current financial situation.

    I am 27 years(1985) old man, earning 6 Lakhs PA, wish to have insurance (till now i have not taken any LIC etc.) I can put 50,000 per year insurance for myself.

    Now I have the following questions:

    where should I put my amount Rs 50,000

    1. Should I take Term Plan of Rs. 11000 per year (HDFC Life while LIC is charging RS 28000 ) for 30 + years of 1 crore ? if yes which insurance company LIC or HDFC Life or else?

    and where should I put my rest 40 K?

    My question to you is if you can suggest me something better. As I`m looking for Life cover(50 lacs at least) and good lump sum amount in next 15-20 years.


    1. Gaurav

      You should go for online term plan from HDFC or any company you are comfortable with , I would say invest rest through SIP in a equity fund .

  187. Gopi Krishna says:

    Iam paying for two policies.

    1. started in 2007 July – SBI horizon -II – premium 12000 INR / year(6k Paid halfyearly. This is doing very bad as per the Unit NAV statement.

    2. Started in April 2010 Jeevan Anand – 92000INR – yearly one time premuim payment – Term 15 Years. i might get around 15Lakhs on maturity. Paid three terms already 92000 x 3 = 2,76000 INR.

    Taking Jeevan Anand for such a huge premium is my bad decision. but when i enquired many LIC agents they told it is a very good plan and i will be pain in excess of the 15Lakhs at the maturity.

    3. Also i invested in Sundaram Tax saver in may 2010 which locked for three years.
    is it a good option to conitue after locking period?

    1. Once the lock in period is over,you need to then find out if it makes sense to continue or not . we cant comment at this moment on that

  188. Vibhor Gupta says:

    i took a policy jeevan saral for long term investmnt , bt later i got to knw that this policy is only beneficial in case of death only. i am 21 , premium yearly- rs.60000 and the term is 30 years. and already paid 3 installments. please help me out what is best form now.. what shall i do for my investments and not for death 🙁

    1. No its not true .. you will also get the sum assured, if you do not die !

      1. Vibhor Gupta says:

        But Sir, before buying the policy my agent and the clerk in local LIC office, they promised about a return of above 1Cr. is dat true? could u plz tell an approx amout how mch i get at maturity.. i really dont hav any idea . help me to sort it out plz.

        1. If it was not written ! , it was never made !

  189. Rajeev says:

    Hi Manish,

    I have taken 3Lac each LIC money back policy of 25 years. First policy i have taken in the year of 2005 and till the year 2010 i have taken total 5 policies [each year i have taken 1]. Currently i am paying a premium of 15000 each. Since it is money back policy, starting from 2010 every year i am getting Rs.45000 back since one another policy completes 5 year block. Do you fell i need to surrender these policies and instead i need to put this in stock market? My age is 29.


    1. Rajeev

      We dont say that close it put money in stock market . But this policy is not going to give you enough returns at the end . I would say if some policy is going to give you money back in next 1 yr, continue it and take the money and close , or just close it all together . What to do with the money recieved is dependent on many things like your risk appetite , your understanding about markets and mutual funds .

      1. Rajeev says:

        OK Thank you. Can you tell me where i can start learning some information about money management in markets and mutual funda? if you could provide some links that would be very helpful.

        Thanks a lot.


        1. Rajeev

          Just check all the articles written here . you can choose to read what you require

  190. Pushkar says:

    I had purchased a HDFC LIFE Sampoorna Samroodhi Plan in December 2011 with a yearly premium of Rs : 25000 and SA: 135000. for term of seven years.

    SO should I continue with this policy or , just consider those 25 k as lost.

    If the policy will provide me good returns , then I have no problem in paying 25k, but I have seen that 5% is max returns and ,

    this policy has 3% assured returns, so in worst case , at end of 7 years, I will not even recovere my paid premiums.

    So please suggest ASAP.

    1. Dont you think its such a unsuitable policy for you . Why do you want to get such a small return when banks can give you 9-10% on FD ?

  191. Dhanesh Kaattoopaadath says:

    I myself have two LIC Jeevan anand policies
    1.Sum assured-2,00,000- 1o years
    Premium paid Quarterly-6065
    Commencement of policy-07/07/2008
    Premium paid till-03/2012

    2.Sum assured-1,00,000- 20 years
    Premium paid quarterly-1401
    Commencement of policy-4/12/2006
    Premium paid till-04/2012

    I had an accident last year and Currently am unemployed.The premiums are in due and needs to be paid soon.I don’t want to continue the policy.Shall I make it a paid up policy or should I surrender the policy.I am not in an urgent need of money.Would like to have a long term deposit.So is it advisable to wait and get the paid up amount after the policy period?

    Dhanesh K A

    1. BEtter make it paid up in that case .

  192. ladiesman770 says:

    I need to buy a policy, I am looking for good return after 5-7 years, Which one should I get??? I mean should I get Jeevan Anand OR Jeevan Saral ??
    Guide me here please.

    1. None ! .. whats your requirement exactly !

  193. aarif says:

    hi Manish ,

    thanks for this nice article..

    i have Jeevan Saral two policy of 52,000 and 48,000.

    could you please tell me the Maturity amount i will recieved after 20 years.

    aarif mohammad

    1. Should be approx 15-20 lacs from each policy !

  194. subhash chandel says:

    hi Manish,

    i am holding a LIC money back policy with normal paying premium
    sum assured -500000
    annual installment-31292
    I am very much confused about the total amount that i will get at the maturity of the policy including my mid Money Back installment (as stated by agent 100000 lakh, 3 times)
    kindly help me in this that i can make my mind for the future investment in LIC.

    Subhash Chandel


    I have taken Jeevan Anurag T.No:168. Paid single one time premium on 30th May,2009. If i surrender, how much do i get ?.
    Is this better option to surrender it ?. Please reply Manish.


      Premium paid on 30th May, 2009 is Rs:32,000/-

    2. You will loose a lot of money , what is agent telling you about surrender option !

  196. Deepak Kumar says:

    I am planing to buy LIC policy for my brother. which one is better Jeevan anand or jeevan saral. I have already investing in PPF.

    1. I wont recommend any of those !

    2. Deepak Bawa says:

      lic jeevan Anand because lifetime risk cover after maturity.

  197. jagadish maruthi says:

    hi manish ,awesome article
    I’am having policy of lic jeevan saral and i’am paying primium of 36000/- per annum ,completed 4yrs,shall i continue or shal i drop .I’am planning to start trading of commodities can u guide whice company is better plz

    1. YOu can surrender the policy in 5th year

  198. Aditya says:

    Hi Manish,
    I am 36 years of age, my is wife 32 years and we have 2 year old kid, and look after our parents, both me and my wife are working. I want to take an insurance policy to secure my family future (not looking for any returns). Would it be possible for you to suggest some insurance plans, am of the idea to take two policies one from LIC purely based on its settlement ratio, and other from a pvt insurance company, can you suggest some for us? Many Thanks

    1. Go for LIC + Aviva or Kotak in that case

  199. Bimal Das says:

    Dear Manish,
    I have paid 3 yearly premium for Aviva Young Scholar @ Rs. 30,000/ which I no more want to continue. Please suggest how to progress with minimum loss.



    1. I think the only thing you can do is surrender it nw !

  200. Ganesh says:

    Dear Mr. Chauhan
    Thanks for the enlightenment. I have few queries. Please help. I have taken the following policies as per the details given below;
    01. Jeevan Surabhi – Policy term 15 years, payment term 12 yrs, started in Jan-2001, fully paid now. Rs.10,670/annum
    02. Asha Deep II – Policy term 15 yrs, payment term 15 yrs, started in Feb-2002, Rs.6,850/annum
    3. Jeevan Anuraag – Policy term 15 yrs, payment term 15 yrs, started in Dec-2004 Rs.9,089/annum
    Do you suggest that i hold these policies or close it as of now. I am 37 years old now & am into business with very less tax liability which i think can be easily managed with my PPF account. Looking forward to hear from you soon. Thanks in advance

    1. 1. U have already paid all the money ,there is no analysis needed here

      2. Make it paid up

      3. same here

      Better make them as paid up policies now .

      1. Ganesh says:

        Hi Manish
        So, you suggest that i can surrender all the 3 policies mentioned above & it will minimise the loss. Am i right?

  201. sumesh says:

    Dear Manish I need ur help
    I have enrolled for a jeevan anand with the following details

    Plan : Jeevan Anand (T No 149)
    Policy Term : 77 (Premiuim payment term 10)
    Commencement Date: 23/09/2010]
    Sum Assured : 1000000 after 10 years
    Premiuim : 29450 payable Quarterly

    I have paid all premium till date. After reading ur article, i feel like im wasting my all money. Can u please tell me what to do now
    Also please tell me when i will get bonus if i continue and approximatley how much?

    1. As its just 2 yrs, you are in tough state . You will not get much money if you just surrender it right now .

  202. Ranjit Singh Shekhawat says:

    I took a LIC policy named Jeevan Surbhi of SA of 4 Lacs in Feb,2009. Total premium pay upto Feb,2013 will be Rs. 122592/- using premium of Rs 15324/- every six month.
    Total premium pay term is 18 Years. In year 2013 I’l get 20% of SA (4Lacs) = Rs. 80k. ( according to Table # 108).
    Should I surrender this policy after getting this Rs. 80,000 amount or before.
    What will be the surrender value in both cases.

    Pl Help ..

    1. Yes, that seems to be a good option . Just surrender after getting that money

  203. Sreedhar Janarthanan says:


    If you want Insurence take a TERM INSURENCE policy.
    (For Ex: There are policys which give 50 lacks life cover by paying a premium of 10000/year,but you wont get any money in return at the end of the policy.
    so if your plan is for 20 years you would have spend 200000 Rs on premium to safe guard your family.

    In worst case if the policy holder expires in 5 years then his family get the life cover.)

    If you wish investment go for Real estate,Shares ,Mutual funds (SIP),Gold ETF and safe investments like Fixed deposits,PPF,RD,NSC,SCSS.

    1. Thanks for your sharing !

  204. Deena says:

    I have Jeevan Tarang policy for which I have paid premiums for 4 years. Is it good idea to make it paid up[stop paying premiums] or should I pay one more year and then make it paid-up.

    1. You can make it paid up now

  205. Pradeep Singh Rawat says:

    Dear Manish Ji, Today, I read your article which is very very informative. A big thanks to you.
    I would be grateful if you could spare couple of minutes to answer my query.

    Presently I am saving 40,000/year in PPF and planning to buy term plan for insurance. Does LIC have a better plan where I could get more returns compared to PPF in the same duration and which also provides good insurance cover?

    Please reply back.. would be indebted.

    Best Regards

    1. No , I dont think any policy will give you more than PPF right now . Better go with PPF only

  206. Ramesh says:

    Hi Manish,
    First of all, I would like to tell that you’re doing a great (free!) service here in this forum to public. Appreciate your effort!

    One query: So far, I have paid 4 yearly installements of Rs.25000.00 towards Jeevan Mitra (Triple Cover Endowment Plan) of 20 yrs tenure. I am thinking to surrender and then invest in MF or invest thru SIP (btw, I am 38 yrs old). I guess that I would get only Rs.25,000 if I surrender. What you may advice me? Should I Surrender or paid-up?


    1. Why not make it a paid up plan now .

      1. Ravi Nagar says:


        First let me tell you, your articles on this website is really helping me a lot to understand the world of investment and insurance. In fact after going to through I have decided to discontinue my Jeevan Saral policy.
        I have certain doubts regarding that. I took the policy in 2010 for Rs 24000 annual premium(Got 40% of first premium back from agent). paid Rs 24000 in 2011 and Jan 2012. Total 62400 paid. What I understand from your forums is that I have following options now:

        1. Forget about the premium paid and move ahead.

        2. I suppose after paying 3 premiums I can surrender the policy. In that case I will get Rs 14400 back (30% of 2 years premium).

        3. Special surrender value: I don’t understand this and not able to calculate how much will I get in such case and whether it will be applied in my case.

        4. Keep on paying premium that I really don’t want to.

        5. Paid up: If I stop paying premium now, will it be eligible for being paid up policy. What will happen to my money then? Will it keep on reducing or atleast I can get the premium paid for lets say after 10 years? Will insurance cover will remain intact?

        Please help me find answers. Thanks

        1. Ravi

          With Jeevan Saral , seems like you can get a big amount back if you surrender in 4th and 5th year . So better surrender in 5th year

  207. vivek says:

    Dear manish,
    I would like to appreciate the article by you. Its quite educative and tells about issyes which no lic office , agent talks about. But it has put me to doubt about two plans which i hold ,Jeewan Anand and Jeewan Chaya, have paid two premiums and paying upto Rs 57000 per annum in total. Kindly advice should I close and go in for PPF, would PPF give a batter return?

    1. You are in tough situation right now , yes generally we suggest to get out of LIC if you are in initial years and use the future premiums in something better.

  208. Nitesh says:

    I have gone through all the comments on this article. I was planning to take some Financial decision for my future through insurance or PPF and a term insurance, so that i can secure my family.
    But going through you article, it’s clear that Insurance companies fetch less returns also in long term than the PPF and FD”s. Ok i want to go for term insurance instead of Money back policies. In this case my future is secure with some lumpsum amount in long term if i invest enough every year.
    For Term policy to secure my family if, incase something happens to me.
    I have only one doubt. Can i rely on term policy, as they are assuring for big amount if some thing happens to me unfortunetly, by taking some amount every year.
    Will they pay this amount to my family or will they try to avoid the claim.
    if the claim is denied then my purpose will be waste.
    All companies have different premium for term insurance and LIC as the highest premium.
    Which company i can rely for term insurance.
    Please give be the best few on which i can trust for next 30 years and my family will not have any problem in claming the insurance. LIC i trust, but still need few more and can i trust on term insurance is the big question here?????

    Please suggest me for term insurance. other investment i will take care of, as i am fine with 7%-10% profit on my investment. So will go ahead with ppf or fd or may be insurance too for tax saving.

    Waiting for suggestions on term insurance and can i rely on this with any insurance company.

    1. All insurance company will pay the claim if you were genuine in providing your information and have paid all the premiums

  209. Vasudev Tadepalli says:

    Dear Manish, I have a money back policy for 50000 and have been paid back twice, amount being 10000 each time. The vested bonus I gathered is 48500. Since I am paid back will that amount be deducted from my maturity amount?

    1. Mostly yes , look at the policy details on LIC website . generally its 20% , 20% , 20% and 40% payment

  210. Shiv Kumar says:

    Hi Manish,

    I really feel very Bad-the way you are misguiding the Peoples and making them Anti LIC.
    Do you really know the meaning of LIC and Power of LIC and what social Work LIC do for this society and what benefits LIC is giving to there customers.

    If you go for Life insurance-LIC is the only Insurance company you can trust in India and no one else-hope you dont have daring to oppose this.

    Guys If you realy want to know the benifits of LIC-its better to meet someone who can give you Geniuine and expert advise.

    90% of the people who invest in LIC are from middle class-they cannot take the risk of investing in Share-Market/Mutual funds also they want Security for there family the one and only option is LIC.

    LIC helps people when even a doctor cannot save the life of someone and Just Says simple words ‘I AM SORRY’ and walks away-its LIC who pays the Heavy amount to the survivers,dont want to say Much….But my dear freinds-you all belongs to Middle-class-dont risk your money and invest in LIC-where your money is Safe.

    1. Can you explain

      1. What is the average life insurance of LIC policy holders and is it enough for their family ?

      2. What is the return of the investment on LIC , is it enough to combat inflation ?

      3. What was wrong in the article ? Which you think is misguiding ?


  211. Arunima says:

    Now a days you may even mail to your lic servicing branch for knowing the surrender value of all your policies.

  212. avinash says:

    hi manish ,
    You are doing good(great) job….I would like to share my experience with you.
    My father does not believe in lic or any money back policies and he does not have any either.And mind you he is 75 yrs now,got retired at the age of 50.He has fulfilled all his duties (financial) for his family .He started investing in stock market way back in 1985 instead of taking lic policy ,which at that time was considered amust(lic).Now he is financialy free and thankfully he has given us better future to look after.The point is why give your hard earned money to somone who will use your money & get rich & in return promise a paltry amt in distant future which whoknows will only be used to pay your maids salary

    once again thank you & keep the good job

    1. thats an amazing thing to read.. Your dad went beyond conventional rules and did what he felt was right .. hats off

  213. Vimal Mathews says:

    Dear Manish,
    I have 1 policy plan 162 – 15, sum assured 5lakh, payable quarterly for 6 years and the commencement date was 4th July 2007. Please tell me the pros and cons of this since i am planning to take a similar one again.
    thanking you
    Vimal Mathews

    1. Better make it a paid up plan .

  214. Subhas says:

    Hello sir
    I have taken lic’s jeevan anand policy of 500000 sum assured on 2/2/2012 for 25 years. My present age is 36. Could u plz tell me the final maturity value for my money giving me the details about bonus and FAB.

    1. The bonus and FAB are future numbers, you can just take a guess of around 40-50 per year .

  215. Mustafa Ahmed says:

    Dear Manish,
    Can you please tell me in which policy to invest… After reading all your suggestions from the last 15 days I am now totally confused… My plan is to buy a surabhi plan, one endowment plan, one child plan and one pension plan. I can doll out INR 125,000 per annum. Plz suggest bcoz I have seen u suggesting not to invest in money back plans due to its high premium. Also if I buy all policies online how much I save in premiums.Thanks

    1. Its not about offline and online , its about Equity and Debt option . Moneyback and endowment plans will give you below inflation returns, do you want that ?

      Or you do want to invest for your long term goals in the best way . I suggest you grab my book from flipkart first –

  216. HT says:

    Hi Manish,

    I am willing to buy a policy for my wife (Age 27 years, premium will be paid by me as she is housewife). I can invest upto 25-30 k per year and i want a life insurance policy which have good return value. Could you please suggest me the our guide me for better policy.

    1. Is it for insurance or investments ?

  217. k.srinivas says:

    your article is simply superb and it reveals that you are master in LIC issues. my LIC policy JEVANMITRA (20 years sum assured 50,000) is near maturity and the loan which i had taken is still due. what can i do? can i repay the loan amount by taking another loan by some where else? or simply forget the LIC loan and wait for the maturity of policy. which is the best way. would you guide me? i am eagerly waiting for your suggesition.

    1. I think if you do not repay your LIC loan , then it will be deducted out of maturity and rest will be paid to you


    i m ravi prakash I have almost finished reading your book. It is a wonderful wonderful book. The ideas are so easily explained with simple mathematics and logic. I think it is a must read for everyone. I totally recommend this book to everyone, and have already influenced 2 new buyers in my circle.

  219. Vivek K M says:

    Hi Manish,
    Can you plz advise:
    Planning to take LIC Jeevan Saral for 30 years with 120000INR premium yearly. In case if I want to withdraw money after 10 years, will I get all the benefits, and in case if I withdraw after 15 years will I get FAB also.
    Also appreciate if you can tell how much will I get after 10 years and how much will be the bonus per year 🙂
    Vivek K M

    1. The bonus cant be predicted like that, but you can see today’s numbers . I suggest you read these threads before applying .

  220. Mukesh says:

    mr. manish u r certainly misguiding and trying to fool each and every person. i dont know your motto and the exact reason behind the same.
    for your kind information and to others if anyone has any issues regarding the lic policies and its payment of business. kindly go to the web page
    and can see the entire bonus and final additional bonus declared by the LIC.
    for endowment policy like plan 14 and 149 are the best insurance plan.
    either manish has some vested interest or has little knowledge about the bonus and final additional bonus paid by the LIC that’s why he has mislead and misguided.
    eg. for the plan 14 having sum assured 10 lacs term 30 years then lic will pay around 35 lac rupees.
    if anyone has any confusion then he can calculate the same through the above stated link.

    1. Mukesh

      Can you share with us how you reached that number 35 lacs ? Also what is the IRR in this policy ? How do you get maturity amount if you do not have future bonus values ?

      1. Mukesh says:

        hi manish,
        here is the calculation
        suppose a policy holder has taken plan no. 14, having sum assured 10 lacs, for 30 years.
        according to the LIC the interim bonus and final additional bonus is declared each year and so i am calculating on the value of the last year

        interim bonus 48 for each 1000 each year, then
        for s.a. 10 lacs 30 years = 48*1000*30= 1440000.00
        final additional bonus for 30 years is 1100 per thousand
        so total final additional bonus (FAB) = 1100*1000=1100000

        total amount payable on 30th year = S.A. + Interim bonus + FAB
        = 1000000+1440000+1100000
        =3540000 rupees

        1. Deepak Jain says:

          Hi Manish,

          I Appreciate myself in going thru all the comments of my friends, found your responses for almost all and I appreciate you for that.

          Can you please let us know whether the calculation given above by Mukesh is the way which LIC applies??

          Waiting for your reply on Mukesh comment with a better clarification.

          Deepak Jain

          1. No I dont think that teh way its calculated . FAB is just once at the end and that also is only for few policies .

  221. Gajjan says:

    Hi Manish,
    LIC has declared loyalti addition for jeevan Saral as 250 Rs , can you help to get %of return ,I am not sure for how many years this amount is.

    Thanks & Regards

    1. Its just a one time addition in the start and might be for the policies which are maturing in current year

  222. K Prashant says:

    Hi Manish,

    I have been investing in two(2) LIC Policies since last 4 yrs which are :
    Jana Raksha having premium 59000/Yr
    Jeevan Saral having premium 24000/yr

    Now , as I am learning about other investment opportunities, I am not sure whether i should continue with them or not . please Suggest.


    1. We dont recommend continuing .. Better make it paid up or surrender them

      1. ashok says:

        your are misgiding

        1. Ohh .. we are sorry for that .. can you please guide him in that case, can you suggest him what is a better alternative and why ? Can you please also put the facts and number to support your argument .

          We would love to learn from you Ashok .

  223. Faiz Ahmed says:

    Hii Manish Ji..

    I have taken a Money back policy of 10,00,000 on Dec 2011 for 20 yrs period with a return of 20% on every 5 years i.e. for 5th, 10th and 15th year.
    Currently I am 27 years old, and I thought that insuring my life and some returns on every 5 years will give a boost to my life.
    But there is always a question whether I am paying more to get this benefit.
    I am paying of RS 5405 as an premium per month.
    So at the end of policy on 20th year LIC will give 40% of assured amount with bonus.
    Can you please tell me what will be the final amount which I will receive by the end of the policy.

    1. This whole thing translates into how much of yearly return ? I dont think its crossing inflation ! .. Thats how money back policies work , better dont continue this.

  224. diptanjan says:

    Hi Manish,

    I have a Jivan Anand Policy (Started Jan 2011). I am paying a premium of Rs. 6302/- month.

    In my policy the Policy term says the following : 65 (premium payment term 16).
    Sum Assured is 10,00,000.00/-

    While taking the policy my agent mentioned I will receive the Sum assured + Bonus on 17th year of this policy (Year 2028).

    I have asked my agent why term is showing as 65, and he mentioned my life is insured 65 years from the day of taking the insurance (I took it when I was at age 35) so this policy will be affective till my 100 yrs of age.

    Do you have any idea when (which year) I can get this Sum Assured+Bonus.


    1. Did you see the policy document , what does it say ?

  225. Santhosh says:

    Hi Manish,

    I read your article…I just got Jeevan Anand for 10 lakh coverage and paying a hefty premium…..I didnt analyse much when i bought the policy….Now let me know what would be the best option……Surrender after 3 years or let it paid up……I am thinking of using the money to get Term Insurance + PPF

    1. Just stop the premium payment right now .

      1. Santhosh says:

        Stop in the sense…..let it get paid up?

  226. Vishesh Girdhar says:

    Hi Manish,

    I am 29 years old and i have bought Jeevan Anand policy for 25years.
    i am paying a premium of around Rs. 24000/annum. i have paid 4 premiums.

    Should i withdraw from the policy and invest in a plan which gives better returns according to you or should i hold onto the existing policy.


    1. I would recommend getting out of it and investing in mutual funds

      1. Vishesh Girdhar says:

        Which mutual fund would you suggest? How do i decide which fund will give better returns as compared to the other? Where should i buy mutual funds from?

        1. What is your goal and risk appetite ?

  227. Dj says:

    Dear Manish,
    I was searching the net regarding the info and I came across your web-site. A very nice write up you have provided for all the users. I am however a little confused mainly because I don’t have any idea regarding the insurance policies, I am looking for a health cover for my self and for my parents the age of both the parents have crossed 60+ yrs. and also they both have High BP & Sugar. Which I don’t think is covered ( What I came across ) Kindly do let me know what policy should I take my income is 1.8 Lac. PA.

    1. You can look at some options like Oriental Family Floater and Max Bupa policies.

      1. Dj says:

        Thanks for your advice. I will look into it and revert you back in case I have any more questions.
        Thanks again and all the best at what you are doing. Getting people educated about insurance is in my mind one of the toughest thing to do in India.

      2. Dj says:

        Dear Manish,

        I went on to inquire about the policies as told by you Family floater plan and in between I was approached by LIC’s agent. He told me about Jeevan Arogya plan. Will that be sufficient for the cover the medical treatments or should I go to another policy?


        1. No , its not the best thing you can buy , better go for standard plans .

          1. Dj says:

            Thanks for your reply. What exactly you meant with standard plans? Kindly explain as I clearly don’t have an idea about it.


            1. I was talking about mutual funds . Dont go for “policies”

            2. Dj says:

              Thanks a lot for your advice.. I will be taking the info regarding MF’s. May be I should enroll myself into your site cause I might make a hasty decision as I don’t have any much idea.
              Thanks again!!

            3. Yes, first learn about things

  228. javed says:

    Hi, Manish
    I’m 25 years old i want to Know Start some Money back policy which Policy annual Primium 12000/- So Pls Suggest policy name & with compelite Datial Bigning to maturity period ????

    Thanks & Regard

    1. What is your risk appetite ?

  229. Kunal Sanwal says:

    Dear Manish read your article about keeping investments and insurance separately
    i do understand the mathematics and the logic behind the concept but in my view Insurance as a subject is too individually need based to suggest the same solution for each and every case as far as my experience which is a healthy 8 yrs goes each and every customer has to be individually passed through a process of need analysis and only therafter any product should be suggested the fact is that insurance is not an investment but more of a complete solution

    1. Kunal

      Not sure on that. Can you give an example where INsurance has to be seen as complete solution ? In my opinion , Life Insurance policy is a life insurance policy and should be seen as that only . Can you give me some scenario

  230. rashid says:

    respected sir
    i want to know regarding HDFC SL CREST investment plan for 5 years in which i need to buy at nav of rs.10 and which gives a gurantee that maturity of your contract will be higher of rs.15 or highest nav recorded during the last 7 years.since i dont know much regardind this please guide sir or should i opt for FD

  231. kawal says:

    Hi Manish what Maheshwar jha is saying is half truth also. For policy like jeevan shree(original , not JS1 or JS 2 ) which was hihest sold policy of LIC till date has a Guaranted bonus of Rs.75 it was later that it got reduced in its subsequent avatar. In india why at present the terms plans are not popular one of the reason is people don’t digest the idea that after paying premiums they don’t get anything if they survive policy term no ody wishes to be told that you get money when you die. overall your site is quite educative keep it up. kawal

    1. Ok , for that one policy, I agree its a great one , But what about majority of plans ? Also I am not able to understand which part of the article is not right . I am open to correct that ? Regarding term policy thing , read this –

  232. PRADEEP says:

    Dear Hemant ,
    Myself taken HDFClife jeevan samruddhi plan .Presently I am paying Rs.2062 pm. which takes total of about 25000 per year. Initially they told me that I would get187000. But later I found that I am not even getting my principal amount after maturity . I paid premium for 5 months. Please tell me that should I continue or not?


    1. Why do you think oyu will not get your principle after maturity ?

      1. pradeep says:


          1. pradeep says:

            Dear Manish
            I calculated IRR based on your format it is coming 14%. . I will be paying 24744 per year for 5 years and i was told that i will be getting 187000 after 5 years. So IRR comes to 14% . Please give me your advice. Whether i should continue or not?

          2. pradeep says:

            Dear Manish
            Based on your calculater If iam investing 24744 per year for 5 years. After 5 years based on their claim i will be getting 187000.
            SO IRR stands at 14%. So guide me whether i should continue or not. How can i recover my amount of 5 months?

  233. pradeep says:

    Hai Manish
    I am Pradeep fromGULBARGA . I presently took HDFC LIFE JEEVAN SAMRUDDHI PLAN . Monthly premium is Rs.2062 which accounts Rs 25000 annually. I took it for 5 years . Agents told me that after 5 years I will be getting Rs.187000 but later I found that it was wrong ,I suspect that even I cannot get my principal amount which is equal to 125000 approx. Please tell me that whether i should continue or not. I paid premium for 5 months?

    1. Why do you think you will get 1,25,000 ?

      1. pradeep says:

        Based on your calculater If iam investing 24744 per year for 5 years. After 5 years based on their claim i will be getting 187000.
        SO IRR stands at 14%. So guide me whether i should continue or not. How can i recover my amount of 5 months?

        1. But did you check if their claim 187000 is right or not , Is it promised in writing ? Agents use any number to pursude people to buy !

          1. pradeep says:

            How can i check . They did not gave me in writing.


            1. Then you cant prove it actually .. Its as good as it never happened !

            2. pradeep says:

              should i surrender policy ? how can i recover my amount

            3. pradeep says:

              should i surrender policy? how can i recover my amount

            4. pradeep says:

              should i surrender policy? how can i recover my amount


            5. You can not recover the amount like this, if you surrender , the policy terms and conditions will apply

  234. Ravi says:

    Hi Manish,
    I have wealth plus policy started in May 2010 and as per policy only you have to pay 3 premiums annualy and i have paid 3 premiums annualy which is 60,000 but now i got a letter from LIC saying that next premium due date is May 2013, but as per policy its only 3 years premium so why i got that letter and i will not pay next premium, so should i surrender the policy or no need to pay premiums and wait till maturity date i.e 2018 and if i wll wait till maturity date then should i get Sum Assured+Bonus.. plz suggest


    1. WHere is it written that there are only 3 premiums in the policy, can you look at the policy document ?

      1. Ravi says:

        my agent told me that and now i have checked the documents and its not saying pay only 3 premiums, now i want to close it, can u tell me how much money i will get.. and if i will make it paidup then how much money i will get ?

        1. It can be defined by the policy only , talk to customer care !

  235. pradeep says:

    Hai Manish
    I took HDFC LIFE JEEVAN SAMRUDDHI PLAN . I have to pay 2062/ monthly premium for 5 years so after 5 years it will be around 125000. Initially I was told that I will get around 187000/ after 5 years but later I found that I would not get even my principal amount. Please tell me whether i should opt out of this policy , I paid 5 premiums.

    1. Better get out of it !

  236. Dinesh says:

    Hi Manish,

    I am 22 years old salaried employee.Planning to open Money back policy f0r 20 years with a annual premium of 50000..How much i will get back after 20 years?is it worth taking this policy?

    1. Its not worth taking , It would give you below inflation return !

  237. Raj says:

    Hi Manish
    very good article. I have 1 question about the agent commissions. I have couple of policies and not getting any service from the LIC agent. do they get any commission from my yearly premium payment ? if yes, I would like to complain it to LIC mgmt or officer.

    1. Yes they get 5% of premium . But they are not liable for any service anyways .. What will you complain ?

      What service are you talking about ?


  238. Bhavesh says:

    Hi Manish,

    Will help if you can share similar arithmatic for LIC Pension Plan and what benefits it give, in case any? Also, options in case Pension Plan is not carrying any meaning after the benefit got clubbed under one tax saving bracket….

    Thanks in advance!


  239. pallavi sharma says:

    presently my salary is 14k/m
    2 child 4 & 5 yrs
    how much I should
    invest /m & where for
    1. Child Education
    2. marriage
    3. My pension

    1. Your Risk Appetite ?

  240. pradeep says:

    Hi Manish

    Great info. I had a jeevan shree-112 policy from 2002. I don’t find any information about this policy or its returns on LIC website. I lost the contact of the agent from whom I have taken this policy.

    1. Pradeep says:

      Some how figured out the returns on maturity. Posting my findings, so that the people invested in this PARTICULAR policy wont get disappointed.
      This is the old jeevan shree (table no. 112-16-25)
      premium paying 24,000 pa
      sum assured 5,00,000
      premium paying term 16Yrs, maturity at 25yrs
      total returns on maturity
      sum assured =5,00,000
      guaranteed additions @ Rs 75 per 1000 sum assured pa = 75*500*25=937500
      loyalty additions @Rs 105 per 1000 sum assured = 52,500
      total = 14,90,000
      You can compare it with traditional investment @8%pa
      For 16Yrs it is RD at 8% and rest 9Yrs FD at 8%(compounded)
      RD returns
      775654-39000(10% tax on interest component)=736654
      FD returns on 736654
      15,02,355-76000(10% tax on interest component)=14,26,355

    2. Pradeep

      There has been tons of discussion on these plans at our forum – , Look at them

  241. Sanghmitra says:

    Hi Manish !

    Let me know tell you a recent incident. One of my relative aged 24 yrs was suggested by his father’s ‘friend cum LIC agent’ to take LIC policy. The guy came with 3-4 quotations with no plan name mention…just some magic calculator stuff….I was being asked to look into them and finalise for my relative…As i was aware of plan structure, those sheets more confused me as to what he is trying to sell…
    Anyways i wasn’t able to explain my relative in simple terms that why not to go for it…
    Since they trust LIC and the friend..and wanted something for Tax purpose…relative took Jeevan Saral ( which i mentioned agent to give to him) with 2 policies of 18 k yearly each…
    I still feel uncomfortable (or confused ) as if could have managed to avoid this transaction 🙁


    1. Hmm.. you could have asked for things like

      1. What will he get back if due to some emergency he needs to surrender it in next 2-5 yrs, please show us LIC wordings on that.

      2. What is the real return of the policy above inflation ?


  242. Sid says:

    And now please tell me, where do i invest this 36000 per annum? That is 3000 per month? I have 3 SIP’s.
    1) Tata Retirement Fund: 2000/month.
    2) SBI tax saver fund: 2000/month.
    3) Reliance equity opportunity fund: 2000/month.

    Are these okay, performance wise?
    And which do you suggest i take now???

    Awaiting your response.

    1. What is the final equity allocation of your portfolio , if its 80%+ , then its fine .

  243. chandan says:

    Dear Manish!
    Just have read your article about LIC policy ..You may call it coincidence but i am glad that i have read your article and can guide someone for the same….Manish even i look in to the JEVAN SARAL plan of one of my neighbour i was all shoked after doing some sort of simple mathematics over his policy…see he started his policy 3 months back with 1531 quarterly with DAB..AS policy says he will get 106452 INR as maturity AMOUNT,this figure is an eye opener for me.. even if he saves his money in any saving account which give him 8% interest rate he will get even much better than this as i calculate 500*120 (months) amount which he will save doing nothing is 60000 …after giving away 60,000 currency to lic and as LIC promises with 10% which i dont think so..he will accumulate only 40,000 rs only after 10 years… I SAY BIG NO TO THIS POLICY…. your take?

    1. Yes .. agree with you !

  244. rashid says:

    im buying lic jeevan anand policy for a premium of 1lakh rupees per year for a period of 25 year how much return will i get please guide

    1. You will get around 40-45 lacs back

  245. rashid says:

    respected manish sir
    im thinking or buying lic jeevand anand policy for a premium of rs.1lakh per year for a perio of 25 years how much return i will get approximately please guide.Also should i opt for fd rather than lic

    1. chandan says:

      Manish says 40 to 45 lakhs….which is correctly said…. But rashid when you say 1 LAKH consistent in a raw for 25 years… ask yourself can you for 25 BIG YEARS?one thing i cant understand even after reading this article you still planning to go for it?… why dont you make yourself a good protfolio where this 1 lakh of your money diversified between different instruments,,(I:E recurring,ppf,good mutual fund schemes etc..) rest on you…

  246. Sri says:


    I am using Bima gold (Money Back Policy). I discontinued in the middle for the total tenure. Now i want to continue can i do this.what is th eprocedure please let me know in detail.Now my age is 29 years.i started this policy in 2006 .

    With regards,


    1. You can revive the policy, but only in next few years of closing it . how much time has passed since you closed it ?

  247. Sid says:

    Hi Manish,

    Can you please reply to me as well. I posted a query on 6th September. Thrice actually by mistake.

  248. Atul Agarwal says:

    Dear Manish jee,

    Thanks for this wonderful article. I landed up here with lots of doubts in my mind regarding my LIC policy. I plan to surrender my LIC policy which is a profit plus policy having current NAV :10.78 and No. of units being: 6500.
    Will i be getting the amount as follows if i surrended my policy?
    Amount = NAV * No. of Units
    Amount= 10.78 * 6500 = Rs 70070/-

    I have paid a total of 5 premiums (Yearly 15000 * 5 = 75000)

    I plan to invest this money in SIP after withdraw. I have a risk taking capability and kindly suggest some aggressive SIP for my investments.

    Many Thanks,

    1. Yes , you should get the full amount

  249. ganapathy says:

    hello sir
    i’m having one doubt. right now i’m paying lic wealth plus this month all the premium i have to pay going to end(for three years i paid) , so what shall i do that is “if i wait for four year it is possible for me to get good return” or else i shall take the money

    1. I think you dont understand the policy, it might not be a 3 yr policy, better you sell it now

  250. Sid says:

    Hi Manish,
    I have taken LIC Jeevan Surabhi policy with 5 lakhs sum assured for a period of 18 years. According to that, i’ll receive 1 lakh at regular intervals i.e. 20% of sum assured, 5 times. And also i am told that i’ll receive an accrued bonus at the end of 25th year which may be close to 10 lakhs. Please tell me how much money approximately will i receive at the end of 25th year. I have paid just one quarterly premium of 9981/-. Should i continue with the policy or just stop it?
    Please advice.

  251. Inderpreet Kaur says:

    hi manish

    i have a policy LIC Jeeven Anand with sum assured of Rs. 1000000/- and the policy term is 21 years. Can u be able to calculate the final sum assured at the time of maturity that i will be paid by LIC. As i have very less knowledge about these insurance and investment. If i surrender my policy after 5 yrs then what will be the amount i will receive back. I have read ur article abt policy surrender but i specifically want to know about the jeewan anand .

    1. Inderpreet Kaur says:

      its jeewan Saral not jeewan anand

    2. it will be same for Jeevan Anand. Incase you surrender within 5 yrs, the amount you will get will be very less like 50% of your money paid

      1. Inderpreet Kaur says:

        thnxxx a lot Manish,

        But if i need my money thn can i take loan on my amount paid after five years ??? Is there a option of making this Jeewan saral a paid up plan

        1. Yes you can make it a paid option

  252. Saravanan says:

    Hi Manish,

    Great Job by You!
    I have a 25 yrs money Back policy which was started in 2003 for about 5 Lakhs SA.
    Now I paid (38,154 annually) 10 terms. I need to pay 8 more terms and wait for 15 more years to get my returns.
    Is it good to conitnue at this stage ? What is your suggestions on investment point?


    1. Better make it a paid up plan !

  253. Sharath says:


    I am planning to invest Jeevan Saral based on reveiws and suggestions from LIC agents and few of my friends. I am 36 and planning for 15 years tenure for this policy.

    Can you plese suggest & advise it is good to invest this Jeevan Saral.


    1. I dont think its a prudent decision. You are asking people who are either biased (agent) or they themselves dont understand it (friends) . Do some maths and find out the returns .

  254. Mayank Jain says:

    Hi Manish Sir, I have taken LIC Jeevan Anand in 2006 and annual premium is ~25,000 while sum assured is 5,00,000. Till date I have paid 6 premiums i.e. 1,50,000 in all and next premium is due today. I don’t want to continue with this policy (please note that I have taken a term-policy last year and I am not in need of money). Please advice what should I do now – surrender, make it paid up or anything else? Thanks in advance!!

    1. Better make it paid up , when you dont make the premium payment, it means it becomes paid up automatically !

  255. jeevan anand insurer says:

    Manish – i am in the tail end of my Jeevan Anand (last year premium is pending). I started a yearly premium paying in 2004 and my last payment insurance for 10 years in May 2013. Insured amount was 10,000,00 with an annual premium of 1,21,029. Roughly how much will i paid after the policy matures… I don’t see any amount or bonus addition on the website online
    Jeevan Anand Insurer

    1. That should be as per the policy document , you should get Bonus + SA

  256. pawan k baidya says:

    Dear Manish,

    Ur articles are really giving deep insight to insurance policies. I was planning to buy Jeevan sathi of LIC for investment as well as life coverage of my & my wife(She has no insurance policy till date). Need to know your specific analysis on that policy, it will be of great help for me.

    Thanks & regards…pawan

    1. We dont suggest any endowment policy , from LIC or any private insurer. You need to take a term plan if you need life cover. Else not

  257. sona says:

    policy commencement date 2.3.09.Whole life limited cover. Premium 11225 payable 1/2 yearly. next due in sept ’12. Cover 5,00,000/-Age now 46 yrs. premium paying period is 20 yrs. All premiums paid till now.

    pl advise should i surrender policy or make it paid up

      1. sona says:

        thanks for your response. Pl note I had made wrong mention of year. Commencement date is 2.3.07 and not 2.3.09 as mentioned. Would your advise still be to surrender or paid up?

        LIC informs that approx surrender value will be about 65000/-.

        thanks and regards


        1. In that case , you can make it paid up if you dont need money right now, else if you need, then surrender !

  258. Chethan kumar says:

    Hello Sir,

    I have one doubt regarding LIC policy maturity For Example if i take jeevan anand policy with Sum assured one lakh paying 1388 quarterly for 20 years, wat will be the amount i get after maturity, my agent said its maturity amount=Amount paid+sum assured+accrued bonus+loyalty bonus. is that true……. than as per his projection maturity amount land up somewhere b/w 3.5-4 lakhs please clarify

    1. Yes your agent it true .. but the bonus amount is different for all the years and it will depend on future bonus amounts !

      1. Chethankumar says:

        Thanks Sir for your kind advice

  259. Mohan says:

    Hi Manish,

    I have applied for LIC Amulya Jeevan-1 for 25 lakhs /35 years; for my age of 28, the premium is 8600 per annum. I had gone through required medical tests and every thing is fine. However, i was operated for tonsillectomy 7-8 years back which i mentioned in the application.
    I was told that, i need to pay an extra of 1625Rs/annum for the same (i.e, 20% extra) – to me, it looked like a very high price for some simple thing that is not even considered as an operation (as there are no stitches). Please advise.

    This is my first insurance policy, I wanted to be 100% sure and hence went ahead with LIC; I planned to take a second term policy from a private player with higher sum assured.


    1. Understand that companies dont look at things they way you are , when you went ahead with some medical operation or some issue ,it means you are unhealtheir than others by some margin . This is how they look at it

      So better go ahead with it , if you still dont want to , go to some private insurer , but you will have to mention this LIC incident there as they ask for any rejections or you rejecting some insurer !

  260. Reena Singh says:


    Your Article is help me One Fren (LIC Agent) of my husband suggested
    him plan “Magic Plan Retire & Enjoy”
    how this plan is should we take it or not.
    we already have very Good term plan of other company so do not require sum assured more.
    I am not intersted in this plan i am more intersted to clear my home loan at earliest.
    please suggest?
    I understand Retirement Plan are nothing diffrent from other common insurance plan.
    kindly revert with your valuable comments.

    1. Yes better dont take it , its just a marketting gimmick .. just ask him to show you the comparision with a mutual fund on long term basis , ask him how much is the liquidity of policy, if you want to close after 2 yrs , can you do that ?

  261. Santosh Kumar Sharma says:

    Hi manish,
    I have taken LIC money back return policy of Sum Assured 4 lakhs (20 years plan). Its 6th year now. I have taken one benefit of 80k also last year.Since I am pursuing my executive MBA , so unable to pay premiums now. when i went to close the policy( 5 months before) they gave me loan of 30k . now i am confused what to do??
    I have taken educational loan of 10 lakhs @ 14% also which i will have to pay from next year onwards.
    I have one term insurance policy also for 40 lakhs.( its premium is only 8500)
    kindly suggest me what to do now??
    should I close the policy or continue??
    Waiting for ur reply.

    1. BEtter make it paid up . You will save your self from paying the premiums, if you need money urgently , better surrender it so that you get some money !

      1. Santosh Kumar Sharma says:


  262. Mrinal Basak says:

    Dear Manish,

    Jeevan Saral: World’s best innovative life insurance product Mon, 25 Jun 2012 01:55:32 -0600 This traditional endowment policy has become very popular because of exclusive features like – high liquidity, fixed risk cover
    LIC’s Jeevan Saral is a traditional endowment policy. Due to the apparently simple outline of the policy, it has become quite popular in the recent years. The policy also got accolade of Golden Peacock for best innovative life insurance product among all the insurance companies of the world.

    Some exclusive features like – high liquidity, fixed risk cover up to 250 times of monthly premium irrespective of age are the factors that adds to its popularity. In recent times the suitability of the policy as a saving cum insurance instrument is highly talked about. In this short write -up an effort is made to clear out some conflicting points of this plan.

    The entry age for the policy can be from 12 to 60 years, while the maturity age is 70 years maximum. The term of the policy can be from 10 years to 35 years. The minimum premium can be Rs 250 per month for age up to 49 and Rs 400 per month for age 50 & above. There is no maximum limit.

    Death Benefit: In case of death of the insured during the term the beneficiary will receive 250 times the monthly basic premium ( which is referred to as the death benefit sum assured) plus return of premiums paid (excluding the first year premium and premiums) plus loyalty additions.

    Maturity Benefit: If the policy matures, the policyholder gets maturity sum assured (MSA) plus loyalty additions.

    Partial Surrenders: Partial surrender is allowed any time after the completion of three years, provided premiums have been paid in full. If policyholder opts for it, the basic premium under the policy is reduced and the policyholder gets the surrender value corresponding to the amount by which the basic premium is reduced. For this special option this plan is also named as ATM plan. But note that like ATM, you are not allowed unlimited withdrawal from the policy.

    A minimum waiting period of one year is required between two successive surrenders and reduced basic annual premium after the partial surrenders cannot fall below the stipulated minimum level.

    Auto cover: If a policy under this plan is in force for full benefits for 3 years, the risk cover under the main plan continues for 12 months , even if subsequent premiums are not paid in due time. This cover, however, does not continue under rider benefits.

    Optional benefits: The plan also offers the two optional riders by payment of additional premium. Those are accidental death and disability benefit rider and term assurance benefit rider. The term assurance and accident benefit sums assured under the riders will not exceed the death benefit sum assured under the basic plan. Also, the maximum cover for the above riders will be Rs 25 lakh under all policies of the corporation taken together.

    Complexities made simple: In all life insurance policies premium goes on increasing with age. But in Jeevan Saral, premium has no direct connection with age at entry. A number of marketing leaflets are floating in the market, wherein maturity values
    are projected in direct relation to the premium paid by the policyholder. These projections don’t keep any link between age, premium and maturity sum assured (MSA).The reality is, this policy provides risk cover of 250 times of the monthly premium.

    So proportionate risk premium as per your age is deducted from the total amount paid by you. This is the reason, why the MSA goes on diminishing as age increases. On maturity of the policy the MSA along with loyalty additions (which is declared on per thousand MSA basis) will be payable to the policyholder.

    The drawbacks: There is always a tendency to compare the returns of insurance policies with PPF or bank RD. Please note that an insurance policy is not at all comparable to these saving instruments. When you invest in PPF, you earn interest on interest (since the interest gets attached to your account every year) and you benefit from the power of compounding. But, there is no compounding effect in an insurance policy. The loyalty additions will be calculated on the maturity sum assured (MSA) on per
    thousand basis.

    Return and advantages: This plan is quite flexible and liquidity feature are good in comparison to other life insurance policies. Being a conventional type policy return is risk free, and it varies only as per your age at entry and the term taken by you. Mind it, in direct contrast to PPF or bank RD, the loyalty additions are calculated on the Maturity Sum Assured (MSA) and not on the premium paid by you. So, when your MSA is higher than the premium paid by you, your return gets bigger although you don’t enjoy any compounding interest effect on your funds. Second advantage of this plan is that unlike PPF the term is adjustable as per your need and convenience. Thirdly, in addition to generating a kind of forced savings (because premium payable under the policy is always compulsory and not optional) it also provides a good risk cover. Last but not the least, the premium amount paid to LIC is exempted under section 80c of income Tax act and the amount policyholder receives at the end of the term after payment of all premiums is tax Free under section 10-10D of income Tax act.

    My verdict:A sufficient term life insurance cover along with regular investment habit through PPF and mutual fund is a must, if you ultimately want to cover up all your future and contingent future needs. In addition to that a good endowment insurance policy like Jeevan Saral will multiply your advantages in respect of liquidity, diversification of your portfolio and additional risk cover.

    give your comment on this article.

    1. For discussion ,you can open a thread at our forum –

  263. vageesh says:

    Chauhan sahab,

    I am 26 yrs of age, earning 31000 per month. I have 50,000 cash for emergency in my savings account which i wont touch unless an urgency comes out.I own no mediclaim policy.
    I am confused how to invest and where to invest. I am investing in PPF account 2000 per month.
    I can invest 3000 per month as premium in any best suited plan. Kindly suggest me the best investment plan for 5 & 10 years. Are the pvt companies such as Bharti axa, tata AIG, Reliance reliable to invest ? kahin aisa na ho k ye bhaag jayen paise le kar kuch saal baad ! plz help me sir. I shall be highly obliged if you can also tell me how to invest in mutual funds .

    1. Dont go for regular policies, you can start with HDFC Prudence mutual funds for now

      1. vageesh says:

        Chauhan saab,
        Kindly suggest me a mediclaim policy ( max.8000 ) which has maximum cashless benefits on hospitalization and covers critical diseases like cancer also.

        1. Do mean the policies which gives you a lumpsum irrespective of the expenses incurred ?

          1. vageesh says:

            no no ….a policy which has fastest cashless claim settlement on hospitalisation and covers my family members.

            1. This is not the criteria to choose ! . And there is nothing like that . I mean to say , a policy with mediocre features will not help you even if it has fast cashless claim settlement . All the best companies have pretty great response time and you should choose on the basis of features!

  264. pradeep says:

    Hai Manish
    I am A.Pradeep presently invested in HDFC JEEVAN SAMRUDDHI PLAN . Tell me is it good or not?


  265. s. mahajan says:

    Hi Manish, we have taken the foll. LIC policies, which I think we should now would like to get out of. Could you please advise whether we should continue, surrender policy, or make it paid up.

    From SA Premium Maturity Prem Till
    jeevan anand 2006 1,00,000 5967 2024 2024
    jeevan anand 2006 1,00,000 5738 2025 2025
    jeevan anand 2006 1,00,000 6916 2022 2022
    jeevan anand 2006 1,00,000 5422 2026 2026
    jeevan anand 2006 1,00,000 7406 2021 2021
    jeevan anand 2006 1,00,000 6480 2023 2023
    jeevan anand 2009 5,00,000 32642 2026 2026
    jeevan anand 2009 5,00,000 34849 2025 2025
    new jeevan shree 2003 5,00,000 31885 2028 2018
    jeevan tarang 2006 5,00,000 34361 2020 2020
    jeevan suraksha 2001 3,80,000 10058 2032 2032

    1. s. mahajan says:

      Hi Manish, Am rephrasing me earlier post. Please advise whether to surrender, continue or go in for a paid up option. The total annual premium paid is Rs180,000. Would like to put at least a large sum of that amount to better use.
      1. Six jeevan anand policies taken in 2003 for a Sum assured of Rs 1 lac each maturing in around 20yrs
      2. Two jeevan anand policies taken in 2009 with a sum assured of 5 lacs each maturing in 16 yrs
      3. Jeevan tarang taken in 2006 for a sum assured of Rs5lacs maturing in 2020
      4. Jeevan suraksha taken in 2001 for a sum assured of Rs380000 maturing in 2032
      5. New jeevan shree taken in 2003 for a sum assured of 5 lacs maturing in 2028, premium payable till 2018

      1. In case any of these are money back plans , and you are suppose to get back some money in few years , then you can continue it , else the suggestion is to just surrender them !

  266. Selvaraj says:

    so will you REAP for all your SOWINGS (Advises, good or bad)

  267. RAJ RANDHAWA says:

    hello manish…
    i want one LIC policy and this is my first time,i don’t know much about all the policies..
    i only know that i can pay a premium of Rs. 90000 to 1 lakh per annum,so can u please suggest me for which policy i should go for and for how many yrs like 10 ,15 or 20yrs?
    please advice me,so that i can directly ask about that policy terms and conditions to customer care

    1. Better not go for any policy . Just take a term plan and invest in mutual funds.

  268. Nikhil says:


    With your help and some extensive reserch on IRDA, Jago investor and Policy Bazaar I finally I arrived at a conclusion. I know there`ll be room for improvement and am open to suggestions.

    Out of the 1.5 lacs of surplus money yearly I have chalked out the following plan.

    1. 25k yearly for LIC Jeevan Amulya SA 1 cr, Tenure 20 years
    2. 50k in PPF
    3. 25K in HDFC top 200
    4. 25K in HDFC Prudence
    5. 25K in DSPBR top 100

    my 3 goals:
    Family security-LIC ,
    Financial Stability – PPF, HDFC Prudenc
    Current money making Future money- HDFC Prudence & top 200, DSP top 100

    Would love to hear your thoughts around the same.

    Thanks Again Manish !!

    1. I think its a very simple and clean plan .. JUst add some money for liquidity purpose too and you are set to go .. I guess its not the best plan, but you should not look for it too ! … just stay in action !

  269. Nikhil says:

    Hi Manish,

    Thanks for the revert.
    I like what you said but just out of curiosity. Is it a bad idea to put 1.5 lacs yearly in PPF. Also I`m 29 so it think by the time it matures I`ll be 44 and will have a fat ppf check waiting for me.
    Please throw some light on why you suggest SIP or MF over PPF.

    Thanks Again!!

    1. Nikhil

      PPF is safe product, thats why .. Confused yet ! .. PPF is safe and thats why the returns are not at more than inflation .. You are young and have a lot of time in hand to grow your money , assuming you are investing 2 lacs per year .. 1.5 lacs in PPF is too much in low return , if you are investing 5 lacs a year .. then 1.5 lacs is fine in PPF

      At the end its your call if you want to earn 8-9% only on your investments for 15 yrs ! .. if yes, thats ok , go ahead !

      1. Sanghmitra says:

        In PPF, max we can put is 1lac…correct me if i am wrong

  270. Dhivya says:

    Hi Manish,

    1. Whats your query !

  271. dr darvesh says:

    Hi Manish,

    I m 29 yr old in govt job with 6-8 lacs salary p.a. with one kid (expecting after 5 mths). Currently, I have following insurance policies :

    1) Jeevan anand (myself): Aug. 2008, 20yrs, 100000(SA), 54576 yrly.
    2) Market plus -1 (myself): Nov. 2009, 15yrs, 200000(SA), 40000yrly.h
    3) Jeevan anand (myself): Apr. 2012, 20yrs, 2000000(SA), 105000yrly.
    4) Mediclaim policy (me and my wife): 500000(SA), 8736 yrly.

    Q. 1) Can you please look at my insurance policies and suggest which option is the best for each policy considering that I m paying considerable premium?
    Continue the policy or surrender or paid-up?
    Q. 2) I m thinking of stopping the 3rd policy (apr. 2012) and buying two online term plans of 50 lacs each from two different companies. What are the best options for this?
    Q. 3) What other options of investment can I look into like PPF/FD/equity?

    plz advice, m very confused.

    1. dr darvesh says:

      manish m still eagerly waiting for the reply..?

    2. You should better stop all of these and take term plan and start a SIP now in mutual funds.

      1. dr darvesh says:

        manish thanks for the reply..but actually, the problem is that i don’t know the fundamentals of equity/mf’s and my father is very conservative regarding putting money into, what should i do in this case ?

        1. You will have to seperate your investments first from your father and learn about money for some time , grab my book and read it, you will get a good start !

  272. anand says:

    hi manish
    i m intersted in jeevan saathi polcy in table no.89
    plz give me details

  273. shanmugam says:

    Hi Manish,
    i am seeing this article very late!
    i have one question! i took a policy from LIC Jeevan Saral and i am paying monthly 2042/-. from nov 2011. The LIC agent came with a calculation and showed me that 16 lakhs will be the sum assured i shall be getting after 20 yrs whereas in the policy document it shows that Maturity sum assuered is 5 lakhs. i am really bit confused!
    whether i hve to continue this policy (i took this policy for my daughter study, etc., after 20 yrs. she is now 4 yeras old) or
    else can i paid up this policy?.
    should i try for term insurance?
    My total salary per month is 35000/-
    idont have other insurance policies.
    Waiting for your guidance/advice Positively

    1. You will get maturity sum assured + Bonus at the end of 20 yrs, I dont think you will get more than 10 lacs approx . Better get rid of it and start a SIP in mutual funds with long term view !

  274. Vijay says:

    Hi Manish,
    i have one question recently i took one policy from development officer of LIC and policy is bulk of three 1. Jeevan Anand (10,486) 2. Jeevan Saral (9608) 3. Amulya Jeevan (1486) Total Premium Rs. 21510.
    he came with one big representation about this project and finally calculation was something 12lacs. This was my 1st premium if it wont work i dont care i will surrender now. Waiting for Ur guidance/advice Positively.

    1. Vijay

      We really recommend that one should not take these policies, have you already paid first premium and the look up period of 15 days are over ? In that case you stand to loose every thing if you surrender now , but thats the best choice ironically !

  275. Madhurie says:

    Finally closed all of the ULIPS and LIC policies. 🙂 Thanks Jagoinvestor.

    1. Good to hear that Madhurie ! ..

  276. Satish Rajan says:


    One of the best articles I have seen on LIC policies, bonus and surrender.

    I would like to know if you get accrued bonuses (today’s value) on surrender of 1) Jeevan Kishore and 2) Childrens Deferred Endowment Plan…both plans with Profits.

    1. You get bonus , but only after 5 yr . I mean if you surrender before 5 yrs, then you dont get bonus part . Also the bonus part which you will get will be reduced sum, because the bonus accrued value is only for future, if you take it in today terms , then its reduced as per today value

  277. aleti says:

    Hi Manish,

    I am 31 with 1 kid, currently i have below insurace policies,
    1. Jeevan Anand (myself) : June 2005, 21 yr, 300000 (SA), 15494 yearly.
    2. Jeevan Mitra (myself) :jun 2005, 21 yr, 250000 (SA), 12838 yearly.
    3. Endowment assurance plan (myself) : apr 2006, 16 yr, 200000 (SA), 12488 yearly.
    4. Endowment assurance plan (mywife) :Mar2008, 16 yr, 400000 (SA), 25368 yearly.
    5. Amulya jeevan (myself) : Feb 2011, 30 yr, 2500000 (SA), 8400 yearly.

    i think 5th policy ( term policy ) is good one after i read your article.
    From above endowment policies, i took loan and still need to pay.
    so could you please suggest what should i do with endowment policies ? should i continue or paid up ?


    1. Make them paid up , or best surrender all of them

      1. aleti says:

        Thanks Manish , i have decided to surrender all of them , but few questio n here. In this article i saw that ” one can eligible to get reduced Accrued Bonus only if your policy has completed 5 premium paying terms” .

        My plan : Endowment assurance plan (mywife) :Mar2008, 16 yr, 400000 (SA), 25368 yearly” ( premium payment mode is haf yearly in March & Sep 12684 each).

        first of all 5 premium paying terms = 5 years ?

        1) For my above policy am I elgible to get reduced accured bonus as this policy is started in March2008? ( march 2012 amount paid but september is pending , if you consider 1 term = 2 half yearly payment in this case ).

        2) if not elgible, should i pay september premium and then surrender it to get reduced accured bonus ?
        3) which one is greter amount my premium ( Rs.12684 ) or reduced accured bonus , can you just calculate and let me know ?

        I would appreciate your suggestions, Thanks in advance,


        1. 5 premium = 5 yrs .

          You first need to compare both the scenario , what if you surrender now and what if you surrender after paying sept premium . take a pen and paper and do the math .

  278. Balaji says:

    hi Manish,

    I’m 38 with 2 kids. Currently I have these insurance policies :

    1. Jeevan Anand (myself) : Nov 2004, 16 yr, 515000 (SA), 37531 yearly.
    2. Jeevan Anand (wife) : Jul 2010, 16 yr, 500000 (SA), 9181 quarterly.
    3. LIC- Money plus (myself): Apr 2007, 20 yr, 100000 (SA), 10000 yearly.
    4. ICICI Pru Life Time Pension II (myself) : Dec 2004, 15 yr, 0 (SA), 10000 yearly.

    I have started investing in below MF’s and PPF from 2012 with Kids education, marriage and my retirement as goals.

    1. Franklin India Bluechip.
    2. HDFC Equity
    3. ICICI Pru dynamic.
    4. UTI Opportunities.
    5. IDFC Premier Equity.

    1. Can you please look at my current insurance policies and suggest which option is the best for each policy considering that I have paid considerable premiums,
    Continue the policy OR Surrender OR Paid up ?

    2. If paid-up, would we still get the insurance cover for the reducted SA + bonus OR insurance cover is terminated by the company.

    Would greatly appreciate your suggestions. Thank you.


    1. Balaji

      This is a big issue people face with their current existing policies – But you need to look at it from next 5-10-15 yrs point of view .The best thing you should do is make it paid up or surrender , anything is fine . Surrender can be done if you need some immediate money

      Your mutual funds are good , continue them and take a term plan !

      1. Balaji says:

        Manish, Thanks for your suggestion.


  279. chris says:

    do we also have a free look period , i have taken a Jeevan Anand policy and i want to cancel it its just been 7 days, can i cancel it now ????????

    1. Yes you can cancel it , hurry !

  280. Hitesh Daka says:

    Dear Sir,
    Can I buy Jeevan anand LIC Policy online ? told me that it is possible so, thats y I m asking u ?
    and what is muturity different between Policy Takem from LIC Agents And This online ?
    I wants to invest Rs. 20009/yr….. for 21 years so Rs. : 4,00,000
    what is Muturity at the end of 21 year …. by Agents and by Online ?

    1. Hitesh

      In this case your agents are that website only , so its the same thing , someone will come to your home to collect premium and give the documents

      1. Hitesh Daka says:

        okay .. thanks

  281. N.ANJANEYA RAJU says:


    10TH YEARS RECEIVED RS.12,500/-


    1. You should get the maturity amount also , ask on forum :

      1. N.ANJANEYA RAJU says:

        thank u for GIVEN valuable information…

        approx. how much that maturity amount getting…..

        i am receiving this amounts:
        5th year…..12,500/-
        10th year….12,500/-
        again this time: 25000+28800+1600 = RS:54800/-

        1. I suggest you ask these question here :

  282. Sagar says:

    Dear Sir/Madam,
    If I have complete 1 year of my policy of Jeevan Saral by filling every premium, in that case can I liable to apply for loan and on what basis or conditions, and if yes then how much amount shall i get if my premimum is per month 500 rupees.

    1. so you just paid 6,000 ,. How much loan do you expect then ? Also loan is generally available only after 3 yrs !

  283. Babbu Pawar says:

    Hi Manish,
    Just now had the calculations for LIC & PPF
    1) For LIC, if u go for 20yr with jeevan saral plan with annual premium of 35000 then, lic will give u near about 15L after 20 yrs (near @8% consideration/yr),
    2) For PPF, if u go for 20 yr ppf with annual fix premiun 30000 again u will be getting near about same (15L) what we are getting in LIC (near @8% consideration/yr),

    Q So insteed of going two diff way (term policy & PPF) directelly we can go for jeevan saral single policy…..?
    Not that much diff in the final numbers…

    ur comments please…????

    1. How did you get this 8% figure from LIC ? Where did you learn this ? DO you understand the liquidity part ? Do you understnad what will happen if some emergency comes and you want to withdraw from LIC ?

  284. Babbu Pawar says:

    Hi Manish,
    Thanks for this thread, Its very good for new comers…..

    I have some questions…
    1) I am planning for jeevan saral plan for yr 36000 premium, but while reading this article it seems is not worth. Q Whether i enroll or not?
    2) If not what would be the investment options without any risk as lic is having & also what about the life insurance again ?
    3) Which investment option will give near about 10% yrly guaranteed ?

    1. 1. No

      2. Take a term plan and invest in FD or PPF

      1. Babbu Pawar says:

        Thanks for prompt response….

      2. Alok says:

        Hi Manish,

        1. I have jeevan saral (tn 165) policy and already paid 5 premiums of 36030/yr. should i continue this policy or close this policy and take term insurance and invest money somewhere else.
        2. How much will i get if i close this policy?

        1. Close it in 5th year !

  285. Manoj says:

    Hi Manish, your article is very informative. I like to invest 60 to 70 thousand per annum. I am 24 and have neither a Life insurance policy nor invested anything in Mutual funds or ppf. Please guide me in taking proper LIC policy and choosing good Mutual fund investment (together 60 to 70 thousand). Thanks in advance.

    1. Just go for term plan (pure insurance , not return of money later) and mutual funds . Go for a term plan from LIC or any private company and start with HDFC balanced or HDFC Prudence fund for 6 months to 1 yrs

      1. Manoj says:

        Thank you Manish for ur reply. Please tell me which term insurance is best. And I also like to take PPF also. I am in confusion on how to divide the amount of 70 thousand among these (LIC, Mutual fund, PPF). Is taking ppf is better or investing complete amount in Mutual funds is good. Please help me in this.

        1. Manoj

          All of them will give different returns and lock in , what exactly are your goals ?

          1. Manoj says:

            My gioals are as follows:

            1.After 3 years need to do sister’s Marriage for that I need around 6 lack (approx.) .

            2. After 6 years from now need to do another sisters Marriage for that I need around 20 lack (approx .)

            3.In between if possible would like to buy a house in Bangalore.

            Please guide me how to invest systematically so that I can achieve my above goals.
            I am able to invest around 60 thousand this year and atleast 1.8 lac per year from 2013.

            Than you in advance.

            1. I think given 60k per year kind of possibility , the goals are not possible to achieve

            2. Manoj says:

              Please guide me sir as I have mentioned from next year I would like to invest at least 1.8 lac per annum.

            3. In that case also given the time period is small (3-6 yrs) , you can not get more than 10-12% return . In that case also your goals are unrealistic , I would suggest to get some solution from our forum :

  286. Rahul says:

    Hi Manish, greetings, i want to buy a investment cum insurance plan, i am able to invest rs 50000 per year. i have some plans in my mind like Jeevan Anand from LIC, Smart kid from ICICI. i am confused for which i prefer please help me to find a better produc. my age is 26 years and i have a daughter of 2 years please suggest to find a good option so that i get benefited.

    1. Rahul

      Why do you want to go for Investment + Insurance in One product ? What is the rational behind it ?

      1. Rahul says:


        Please suggest, my ultimate goal is for investing some money for my daughter’s future (Education/Marriage) and also for me in old age,

        is it good for me to buy some child plans.

        1. Just go for mutual funds in that case

  287. Godfrey says:

    Hi Manish,
    I am in a predicament and need your help sorting this out.
    I was sold ” the endowment assurance policy t no. 14 ” LIC policy in 2006.
    my yearly premium is 27,390
    sum assured : 14,00,000
    policy period : 50 yrs. ( this is ridiculous I know ) I was aged 21 then.
    I may not make it to age : 71 yrs ( in all probability)

    I have made payments regularly upto year 2012.
    i.e. 7 yrs x 27,390 = 1,91,730

    After reading your article I have realized I have been fooled into this plan.
    Please guide me so as to stop this policy .
    Paid up – (certainly not an option due to maturity period of 50 yrs)
    surrender – ( return of a meager 49,302 )

    What do you suggest is the best way out of this mess .
    Please help !!!

    1. Truely speaking, you have no option . There is only one option to SURRENDER , do it 🙁

  288. Navish Jain says:

    If I have an eligible policy of SA=5L, with a premium paying term of 20 years, in that case, would FAB be paid (accumulated to the policy) every year starting from year 16 (Rs 60) and then again at year 17 (Rs 100)so on; or just one time at the end of 20 years (Rs 200)?

    1. FAB is always a One time bonus

  289. pradip says:

    Pl explain that does the return varries in lic jeevan saral in term 15 or 16 & 20 or 21
    unlike other traditional policies of lic like jeevan anand the bonus rate tend to increase in slabs from 11-15 then 16-20,21— it applicable in jeevan saral ?

    1. Yes , its applicable to all the LIC policies which are with profit plan

  290. Ramesh says:

    Hi Manish, I took Jeevan anand policy for 20 yrs in 2008 Oct. every month i am paying Rs.2718. So far i finished 3 1/2 years of premium paying term. i want to surrender the policy now but i came to know that i will get only meager amount if i surrender now. i am little confused whether to surrender it or make it paid-up or simply continue the policy because if i surrender, i will be loosing lot of money. i need your suggestion please.

    1. Ramesh

      You are in same boat as millions of people . Sadly you are into a wrong product (i should say unsuitable), and getting out of it later means more loss , loss right now is also a big amount , but you will have to bite the bullet .

  291. Rupen Kohli says:

    Hi manish, i have a very simple question for you. Plz advise. Basically i want a stamp on my decision from you since u are give such a sound advise!! (i will take the step in a few months).

    I am planning to take LIC solely from a return point of view, and on paper, the Jeevan Saral has attracted me. I am talking of a minimum of 20 years here, most preferably around 30 yrs. I am just 27, so I am viewing this from a retirement perspective. I went to my bank (HDFC) to see what they had on offer and they were pushing me to take their most hyped product, Crest. I listened to them and was drawn to their argument for a moment that LIC policies block my money, i.e. i cannot recover that amount back in a few years or get out of that policy. This point you also have made very clear which i understand. However what I am thinking is that for saving tax i anyways would plan for that roundabout Rs 1 lakh investment every year in multiple places. So i am inclining to take Saral with 60 k annual premium. In this way i am guaranteeing that i would be saving at least 60% of the maximum tax savings that i can every year of my life, and if by god’s grace i see the face of the earth after 30 years, I am getting 11 % IRR (yes, i am good with numbers and through a lot of reverse calculations i made that out from the matrix my LIC agent gave to me) after 25 years in the form of Rs 68,255,06 and 10.65% IRR after 30 yrs in the form of Rs 1,12,82,555. My intention is that i would only keep putting money into this fund and not even take any partial withdrawals so that the final amount is handsome and undisturbed. So in a nutshell, i plan to block 60 k for all my life every year and since that is roughly my one month’s salary right now, i hope taking that much out should not be too much of a worry even once i add more responsibilities on my shoulders in a few years (right now im unmarried). Plz take some time to elaborate on the pros and cons of my decisions because right now i can only imagine the handsome final return (plus any loyalty bonus which you have mentioned) so may be i am not able to view the full picture which you can. Thanx a ton for viewing my long question but it was necessary to fully comprehend what i had in mind.

    1. Rupen

      I dont think you have taken the numbers correctly . The IRR of 11% is not possible , do not trust on the LIC guy numbers which was on template , Its just a estimation with some assumptions , go to LIC website and see the mumbers

  292. RAJENDRAN says:


    1. Your agent will be able to answer that with numbers

  293. Dinoop says:

    Hi Manish,
    Hw r u?ur artical is very informative.need to ask u 1 thing.i hv jeevan saral policy,tenure is 20 years and i m paying premium of 18000 it possible to change the premium amount?as its not worth to close the same before 3 years.kindly advise or if u can spare sum time please let me know the procedure if required so.thanks

    1. No i dont think it is possible .

  294. Rafiq says:

    Hi manish,

    I have taken Jeevan saral poilcy. I want to know if I continue the policy till its maturity. then will I get the all that money which they display in one table format or not. Forget about closing policy…i will continue….so they will give me the money which they assure or not.

    Pls reply

    1. You will get what is mentioned in your policy document .. Sum Assured is assured + Bonus

  295. sadiq says:

    i would like to know total remaining money i get from my this month matured moneyback 75-20 plan.sum assured was rs 50000(premium 842 paid quaterly for 2o years) and i had taken all 3 bonus)

    1. Sadiq

      Please ask this on forum with more details :

  296. Nitin Saluja says:

    Hi Manish,

    I have query. Please advice

    I have Bima gold LIC policy and let say it’s payback was dude on 1 Jan 2011 but I change my house so i didn’t received my payback letter. So I went to collect my amount say around may 2012 (after 15 months).
    There I notice on my money which was unclaimed for more than years LIC earned some interest.

    Please advice who would be beneficiary of the interest amount. Please help with proper policy clause.

    Nitin Saluja
    HP: +65-91067375

    1. Did LIC intimate you about the policy when it matured ? If not , then they are liable to give you interest, else not

      1. Nitin Saluja says:

        Hi Manish,

        Thanks for reply.

        LIC sent letter but my address was changed, so I didn’t recieved it.

        Moreover I am trying to know what policy says, even if they sent letter but i didn’t collected it for 15 months. So is liable for interest money. Is there any minimum amount or lowest interest on which I will get my money.


        1. Nitin

          I dont think you stand a chance here .. LIC has sent the letter of intimation to your address which was given by you . It changed in between , but you never informed them , Now they have done their bit , if you do not take your money from them, they will consider it as “idle money” , you are not suppose to get any interest on it , why should you ?

          Its little bit like a FD which has matured, which does not earn anything if you do not renew the FD .. you can never tell banks that just because i didnt come to taking back the money give me the interest on that .. Does not make any business sense to me atleast . what do you think .. How about this situation , you took some money to your friend like 10,000 and told him that you will give 11,000 to him after 1 yr, now you tell him and call him that he should collect it from you , you also go to his home to hand over to him , he says he will come and collect it .. now he does not come for 4 yrs .. and when he comes after 4 yrs , he says that please give me 15k . Is it right ?

          1. Nitin Saluja says:

            Hi Manish,

            Thanks for reply.
            Got your point. Nice example.


  297. Mujeeb says:

    Hello Manish,

    Very Nice Article. And I am also happy to see your replies to comments..

    Hope you can help me with my problem.

    I had taken a policy 5 years back in 2007 (LIC “New Money Back Policy” T. No. 93)

    I only paid 6 premiums which were to be paid quarterly. i.e. only 1 and half years premium.

    Amount 6537 * 6 = 39222
    Now when I woke up and thought of renewing this policy the revival quote is 108569 (Late Fee or interest is 17051)

    I will be getting 75K as money back frm it as its 5 years completed. I would like to ask if its viable to renew this policy or just forget it and close it.’

    Also let me know if I renew and take 75000 and close it ? Will I be able to recover some amount of it ?

    Thanks in advance..

    1. Are you sure you will get back 75k ? Why do you say so , your policy was lapsed , i dont think you will get that at all !

  298. Gomathy says:

    Manish, u recommend to go for Mutual Fund.Can u suggest some good companies …

    1. HDFC Top 200 , DSPBR top 100

  299. Chandra Bhushan says:

    Hi Manish,
    Very nice article. I have a question or suggestion on below —
    I had taken a policy from TATA AIG and paid the premium for 2 years but after that I didn’t pay the premium for three years.
    So, is there any way I can start paying the premium again with some fines and by paying three years unpaid premiums or its all gone?


    1. YEs ,there will be something called as “revival of policy” .. see that

  300. 100rabh says:

    Hi Manish,
    I have taken Jeevan Tarang policy in June 2010 for 20 years. My annual premium is 76000 rs. After reading your article i feel myself cheated.
    Kindly suggest if i paid up policy after 3 years rather than surrendering it immidiately.

    1. You are in bad shape right now . Surrendering it now or after 3 yrs will not make much difference, you have already lost a good amount here and wont be able to recover it .

  301. Narendra says:

    Hi Manish,

    I’ve just woken up to the world of personal finance management. Like 90% of LIC policy holders, I too bought (rather forced upon) a policy from an uncle of mine. I have the dreaded Jeevan Shree for which I have been paying up around 25K per year for the last 10 years 🙁

    After reading several articles about this product, I am now really confused – should I continue? Should I surrender? I will get only about 70K back. Or should I make it paid up? I really don’t know how the ‘paid-up’ process works. I gather that I’ll get my money back only after maturity sans any interest henceforth.

    I really wish I had woken up earlier 🙁 🙁 🙁

    1. Narendra

      You dont need anyone else to tell you what you should do , a little math and 15 min will give the answer , or i would say a sad answer . Just see case 1 where yo u continue and case 2 when you do not continue , which one makes more sense from money point of view .what if you invest the surrendered money + future money in something else ? I think you should get more than 70k in case of surrender , why are you saying just 70k ? I assume you are saying this assuming 30% of paid premiums , but thats only after 3 yrs , if you have complteled 10 yrs , then i think you will get around 60% of the premiums paid excluding first year premium . So I assume it would be close to 1.6 lacs + . Did you get this 70k figure from LIC ? Enquire about it !

  302. Basanagowda says:

    Hi Manish,
    I have a LIC Jeevan Anand Policy. I took it in Sep, 2010. I have been paying 38123INR yearly and the Sum Assured is 5,00,000INR. Maturity period is of 15 years. I feel I took a wrong decision by taking this policy. What would be your suggestion for me? Should I surrender this?

    Thank you,

  303. rose mal says:

    in august 2013 my money back policy of 1 lakh will be due for maturity i received 20000 at the 5th / 10 /15th year what is the amount i will be receiving in august 2013

    1. Please enquire at company , they will give you the right numbers

  304. Rakesh says:

    Hi Manish,

    I have bought – 25 Yrs. Money Back Policy ….. and per yr. premium is INR 10140 ,

    I wanted to know what would be the returing at the end , is it

    40 % of total sum assured , + bonus at rate of 53 i.e 53*200 * 25 =INR 265000.00
    Total would 345,000 including 40 % of sum assured at the end — is my understaing correct … if not please advice me in details also is it posible to get loan on this policy ?

    1. It would be very clearly mentioned in the policy document or on LIC website , why are you not looking at it ?


  305. Timsy says:

    Dear Manish,

    As i am planning to invest Rs 2500 pm in Jeevan Saral Policy for my son future for 20 years. Please let me know is this a good policy to invest. Also i have one query regarding the same, if i pay lump sum Ist year premium of Rs 30K together n later on converted into ECS , is that possible in this policy.. do let me know.

    1. I would not recommend that policy , Just invest in a mutual fund through SIP

  306. Shrikant says:


    I am 25 yrs old. If I invest Rs. 2000 per month for 10 years in Jeevan Saral policy, what amount will i get after maturity?

  307. Romit says:

    Hello everyone,
    I dont know whether it is the right platform to ask this question. But i heard something very strange from my LIC agent.
    He said, “LIC will give you return even if bank stop paying interest after 10-15 yrs.”

    Is it really possible that banks may stop paying interest? Can we have a scenario where there are no debt instruments like FD,RD etc in future? Or if there are these instruments then with very less rate of interest??
    And do you think these interest rates will decrease in future??

    1. Romit

      I dont think bank will stop paying interest, why will they do so ? There is no reason and the statement your agent made I think was mostly to make LIC policies look great .. however there are chances that bank interest may go down if our economy progress a lot after years ..

  308. Iqbal says:

    Dear Mr Manish.

    Can i ask you 1 Questions ??

    Why People Need to Take insurance Policy ?
    If you did not find the answer. Please go to any Widow and Ask. How Her life is going on. Is Insurance policy is important to buy for a family or not ??. I am sure She will Give you a definite answer to you and that will be proper answer.

    2nd thing Remeber ” juth ki buniyad ke sath itni bari corporation banna impossible hain” trust and truth is definitely under LIC

    LIC does not mean any High Return

    How many people you know who can make a Big retirement amount through a saving bank account or Bank Fixed Deposit or Share market or any other Leading Instrument

    saving account : after getting salary within next 20 days it will O

    Fixed Deposit : 10 Yrs , Customer will wait to take the cheque before 2 months of maturity to Cover loan, child Education, child marriage Etc

    share market ; when it will UP. withdraw and make shopping and dinner Etc

    that is happening with 94 % indians.

    Only LIC policy Holder , Even Getting 3% return , will be a Big amount when you will Retire. So if any body dont want to beg at older age to his son or dependent . (99% happening )you can go for a long time LIC policy. For Long Term commitment , your saving will be definite

    Hope you can understand the concept.

    Rember : Unsuccessful Peoples Mind Always negative. So Be Positive dear.
    I given claim to a Lot of client. and I can fell when I go to the client house with a Cheque. whatever client didnt paid. and that will survivor for His Family.

    I request to you all the policyHolder. Please Dont Cancel your Policy with getting the knowledge of a Negative Minded People. Think About Your family. If you love your wife, Children , your parents . Take policy for a long Term.

    Death is Certain but Time is uncertain. If uncertainity comes to your life any time. if you dont have the insurance plan with proper Cover. even your wife will say. My husband was really illiterate. backward minded. your child will not get any guardian. a lot of ………………………..
    Iqbal hussain

    1. Thanks for your views Iqbal , I hope there are some learnings out of your comment and people can take the right decision

      1. Tushar says:

        Hi Manish,

        I have taken LIC’s Jeeven Anand Policy for 20 years in 2008. I am paying 27K from last 4 years and I have taken this policy when I was not aware about life insurance and investments. But now I as I better understand that clubbing Insurance with Investment is NOT good idea (as it is unnecessary expensive) hence I am thinking why I am paying 27K/Year for only 5 Lakhs of Insurance.

        Additionally I have taken 1 CR of Term insurance (LIC+Kotak) recently hence my Insurance liability is sufficiently completed.

        So now I am felling that paying 27K/Year for just 5 Lakhs of insurance is not logical and additionally even if I think of return I am sure that after paying 5.4 Lakhs (20 years*27K) in 20 years I won’t get more than 12 Lakhs Rs in Future.
        So should I stop this policy & start investing these 2700 Rs in MF SIP better? Will I be in loss if I stop this policy?

        1. Yes.. in my opinion you should stop this now .. just surrender it

          1. Tushar says:

            Hi Manish

            I have enquired about surrendering my Jeeven Anand policy and I came to know that as on date I have paid 91000 in last 4 years and I will get only 46000 back if I surrender this policy. So 46000 Rs of net loss is there.
            So is there any other way you know to minimize this loss?

            1. No . This is exactly what will happen and this is clearly written in policy document .

          2. Tushar Gawande says:

            HI Manish,
            As I told you in my last comment I had applied for LIC Term plan (to be on safer side) where I was suppose to pay 30K/Year for 30 years against 75 Lakhs of SA. But now I got call from them saying as my Weight is 84 KGs (As per LIC as per my height is should be 76 Kgs) they can’t provide me same cover in 30K and I need to pay 16K extra per year. So it will be 46K/Year which I guess is very huge amount for expenses point of view on insurance.
            Can you please suggest me what I should do in this case. My age is 30 Years.

            1. If you are hell bent in case of LIC , hten you cant do much .. else you can get a cover in less than 10k from other insurers !

            2. Tushar says:

              Yes I have decided to cancel the policy but the LIC person told me even if I cancel this proposal and the go to private insurance companies they will also charge me for my extra 8 KG wt. hence frankly I am really scared now and not able to decide should I cancel it or should I pay extra premium to LIC?

            3. Even if you pay extra to private companies, how much will it be ?

    2. Kush Kapoor says:

      I am 100% satisfy with Mr Iqbal View. Thank you Mr Iqbal

    3. Romit says:

      I dont think Manish in any way is saying here that one should not have an insurance cover. It is must for everyone.
      But the point here is that, everyone knows, return from stock market over a long period of time like 20-25 yrs will be much higher than any other thing. And as far as giving a cover to ones family is concerned, one can for a term plan with much higher cover at very less cost.
      So if one is giving 30000/yr in endowment plan(not necesarily lic but any other company also). And the same person buy a term plan for 7000/yr and invest remaining 23000 in Mutual funds, then his return and life cover both will be much higher than any endowment plan.

      1. iqbal says:

        Dear Mr Romit

        You have a good Views. But 97% of Indian Cannot Save money through Stock Market. Because whey they need the money , they sale stock and fill the requirement. in LIC Policy Saving is with Force. there is no option to cancel. only surrender option for which they will get loss. so saving will ultimately continue for future or retirement.
        Yesterday i was talking with one of my friends for saving in LIC. his age is 43 yrs. (career started from 22 yrs)I described the plan and he want to save for his retirement but he was telling to me , right now i dont have any money , i can do after 2 months. see what he is doing from last 20 yrs of his career now even today he dont have money around 50 k to invest. this is going on with indian 97% people. he was invested in FD/Share Market/Mutual Fund many more script. but when he was some requirement faced. he withdrawn.

        Hope you can got my point. That only Life Insurance product is the best saving for Retirement or Long Term Goal


      2. Romit says:

        All these thing said, yes it is correct that endowment plans(specially provided by LIC) has a place in Indian heart and market. And i think it is here to stay for those who dont have the risk apetite to put their money in market.

  309. Rocky says:

    Dear Manish,
    I have 2 LIC policies – Jeevan Surabhi and Komal Jeevan.
    Jeevan Surabhi
    Sum assured: 5,00,000
    start date: 25/04/2005
    Yearly Premium: 43126
    The surrender value of this is 98903 and the paid up value is 2,00,000

    Komal Jeevan
    Sum assured: 3,00,000
    start date: 10-May-05
    Yearly Premium: 22566
    The surrender value of this is 121856

    Pls let me know if I should surrender/make it paid up or keep these policies.

    Thanks for your help.

    1. We suggest surrender always !

  310. Navin says:

    Hi Manish

    Great article, i was about to invest in LIC policies, however after reading your article i have changed my mind and rather go for investing in MFs.



    1. Navin .. thats a wise choice !

      1. Babbu Pawar says:

        again MFs are also depends on the equities, how can we expect better income from them ?
        Can u answer manish pls….

        1. You should first understand that Mutual funds is mainly for growth point of view and over the years you can expect capital appreciation , better you grab my book and read 3rd chapter on equity and debt

  311. Shreela Sen says:

    Dear Mr Manish
    This is a such a useful article, & the “how LIC policy works” graphic is just fab!
    What’s even more fabulous is that you’re still answering comments.
    When I decided to save Rs 12K per month, my Dad (being Dad) din’t allow me to invest completely in mutual funds. I put equal amounts in ICICI Prudential Focused Bluechip Equity Fund Retail Growth SIP, Jeevan Surabhi of 4,50,000 SI, & Post Office 5 yrs recurring deposit. DO you think these LIC policies are totally dud?
    Thanks for your help!

    1. Shreela

      LIC policies will give you 4-5% return , now you need to tell me if they are dud or not 🙂

      1. Shreela Sen says:

        Thanks for replying.
        But I must mention that you make “Mutual Funds” sound too simple. (On this page) you talk of MFs as if they are standardized, homogenous products. While it’s not z case. It’s as easy to lose money on MFs, as on endowment plans & ULIPs, only, sans z illusion of comfort

        1. They are simple product i would again say that . here I am talking about a category of mutual funds and its equity mutual funds . Its like LIFE . Its complicated dependening on how deep you want to explore it . thats the reason there are happy and sad people . Life is same .

  312. Jose says:

    I have an double cover endowment plan…which i took in Kuwait.
    Sum assured: 10000$
    start date: 01/03/2009
    date of last payment:01/12/2023
    QUARTERLY Premium: 194.42$
    Paid till 03/2012.
    Options that this policy comes with…
    sum assured can be reduced after one year.
    ssurrender or paid up option after 3 years for full terms & 2 years incase of limited term.
    Pls let me know the available options to minimize the lost amount.

    Thanking you for your kind colloboration.


    1. Its just like other LIC policies .. just get rid of it

      Better ask it at

  313. bibekananda sarangi says:

    Hi manish what a great article.
    i am in very much confusion for my financial planning.I my annual salary is 480000.
    and take home is 35000.I have a jeevan tarang poicy witha annula premium of rs.15200 for 17 year.Now the situation is one of my relative is lic agent and he wants me to by a policy.He already convinced me for buying jeevan anand-but after reading your article i am in no mood to invest much into jeevan anand.i’ll definitely do a lic with him but with smaller amount.Is jeevan tarang ad jeevan anand is same kind if policy with life time cover.For investment purpose what i really need to do where i have to invest.Please suggest me .I’m in intial stage of my carrer .My age is 27 .S/W engineer by profession.Please keep in mind i’ll definitely buy one more policy .Suggest me how much i have to invest in LIC as i have already invest in it and other area where i can invest my money.
    Thanks in advance

    1. there is no sense in investing in LIC , you can do it if you want 4-6% returns , but other wise there is no reason . Stop investing with your agent who is a relative also .. You should invest in Mutual funds through SIP’s


  314. Romit says:

    I have a question about LIC maturity amount calcualtion.
    The following is my estimate of the sum i can expect to receive on maturity of my policy(LIC Jeevan Mitra) based on the information given in the article. Please verify it is correct or not.

    1. Sum assured = 5 lacs

    2. Simple Reversionay Bonus = For last few years it is 50rs/1000 SA. If we take an average of 45rs/1000 SA for 21 yrs, then it will be 21*45*500 = 472500

    3. FAB = For 21 yrs, it is given in the table 250rs/1000 SA. So it will be 125000.

    4. Loyality Addition – Not taking into account as no idea of the rate

    So total amount receivable on maturity = 472500 + 125000 + 5 lacs = 1097500

    The premium for this is around 26000 + taxes(yearly) with accident benefit.

    1. Yes that is correct . But remember that this is estimate and depends on actual bonus figures . Also FAB is not always sure .. Its at discretion of LIC

  315. subhash says:


    1. Your money will be doubled , what else … The IRR wont be more than 4-5% … is it written in the policy that you will get 3 lacs + 70,000 ? Who told you that

  316. Romit says:

    I have just started my career and financial planning. I want to start with taking an insurance. I dont have any financial dependencies as of now and i am thinking of taking 15 lacs cover using LIC jeevan mitra(triple cover, SA=5 lacs).
    I also thought of taking a term plan but now i have decided to take it after getting married(after 4-5 yrs).
    The logic behind going for one LIC policy is that after getting married, i will have 2 life covers, one from LIC(very reliable) and a term cover as well(from pvt company, not as reliable as LIC).
    Please tell me if i am right in doing this?
    And are there any implications of having 2 policies from 2 different companies? Can one company reject the claim if other has rejected?

    1. Romit

      What you should see is your sum assured and not the number of policies, is your cover enough ?

      1. Romit says:

        Right now i dont think i need any cover what so ever as no one is dependent on me for a single penny. I am taking it for future, as most probably i will be getting married after 4-5 yrs. And just to make sure that in case my parents need some money and i am not there, there should be something on which they can rely. So right now i think 15 lacs cover is more than enough and i will be increasing it with my income and age(as i told you that i will take a term plan after marriage).
        And the reason i asked about the number of policies is that i have heard that one should divide the sum assured in 2 policies so in case 1 company rejects the claims then there is other to fall on.
        And the reason for choosing LIC is that their claim ratio is best in the industry.

        1. Romit

          Ok in that case you can go with a lesser cover , but for checking just check the premium of 15 lacs in LIC and 50 lacs in other companies and then go ahead

  317. Veer says:

    I want to surrender my lic jeevan anand, after reading blog. I’ve paid 4 premiums, 5th one i have to pay this april. When i called lic customer care they are saying that, if i surrender right now, i’ll get 50k (50k loss). But my lic agent saying that, dont’t surrender rightnow, pay 5th premium & if u surender next year, u will get 80% back (1lack). I would like to know that… it true (my lic agent thought)? Please reply me asap, bcz i’ve to decide by this month? Any quick response?

    1. Veer

      I dont think you will get 80% at all .. you will get around 40% of your 4 premiums .. thats all

  318. A PAL says:

    I have 2 LIC Jevan Mitra Tripple Cover & 1 PLI endowment assurance Santosh policy as listed.My age 34.A Central Govt Employee
    1. LIC 133-26-26. SA 1.1 Lac Premium 5540/ pa
    2. LIC 133-27-27. SA 1.1 Lac Premium 6630/ pa (Having critical illness & premium wave off rider benefit)
    3. PLI EA/45 santosh of 1 Lac, Premium 5576 pa. PPT-17 years.
    What will be its Appx maturity value.
    Now I would like to take 1lac LIC Jevan Tarang 10 year PPT, 2 Nos 50th each LIC jevan mangal What will its premium.

    1. A Pal

      Just add all your sum assured and multiply it with 1.5 to get a rough estimate

  319. Bimal says:

    Thanks Manish for your suggestion and concern! I approached to LIC only after taking your views through this blog which I found matching with them. Regarding HDFC ULIP schemes, although, they had suggested for continuation for another few years, I had opted to surrender immediately. I have started a few SIPs and opened a PPF account which, I should have done much earlier. Unfortunately, my contact with you was late. Neverthless, I am happy that whatever financila decision now I’m taking, I’m doing with much certainity and consciously. Thanks again for your support!

    1. Good to hear that Bimal .. keep going like this !

  320. Sourabh says:

    Hi Manish,

    A very eye opening post. However I find it hard to understand your recommendation of surrendering the endowment plan despite the premium paid. Consider for example, I have a Jeevan saral policy for which I have paid a premium of Rs. 60, 000 over 1 year. If I were to surrender it now, I would actually loose all that money. Are you saying that I can recover that lost amount of Rs. 60, 000 by investing into equity linked MF etc.? Given the current market situation and underperforming MF’s, do you think that is a good idea?

    Best Regards

    1. Sourabh

      Yes .. i mean that only .. it goes like this ..

      You can invest 60,000 per year for next 20 yrs and generate amount X by getting 5% return . Now instead of that forget that first year and now invest that 60,000 per year for 19 yrs to generate Rs X + Y by getting 5% + Z% return , all you need is 6% return . Is it hard to get it ? FD’s , PPF and equities, all will give way better return .


      1. Sourabh says:

        Thanks Manish. This is really food for thought.

  321. Bimal says:

    Hi Manish & other Esteemed reders,
    Suresh might have written this out of frustation. My experience was totally different. I had a Jeevan Saral policy for last 2 yrs and when I approached to my local LIC office, the officer concerned had suggested me to pay for another one year and go for paid up option to minimise the loss. Similarly, I had a few HDFC ULIP schemes and they had also shown concerned and suggested how to go for minimum losses. My opinion is choice is ours whether to go with LIC or not. But for someone’s inappropriate behaviour, let us not blame the whole organisation.


    1. Yes Bimal .. agree .. regarding the suggestion made by LIC to you , just make sure you are convinced and have a proper understanding of both the scenarios !

    2. Suresh says:

      HI Bimal,

      I have not written out of frustration. I have paid just 2 premiums which is worth 5.5k; so no big deal. The LIC told me too to pay upto 3 years and get back some percentage of money at the end of 3 years.

      If i were you I would pay upto 3 years and take whatever I can from LIC since I have been paying for 2 years, but mine is just 2 premiums old. I just tried if i can get my money back if not full at-least half, but the LIC office denied since they have rules. I wrote my experience to educate others who may think of approaching LIC to take back the money which they won’t get if they try too soon like me.

      I am just supporting this article. 🙂

      1. Suresh

        Do you know how much you will get back after you want your money back after paying for 3 yrs ? Its generally 30% of your 2 premiums . Which means that just 0.6 times of your 1 premium . thats all … So if you pay 10,000 per year , and you have made 2 payments , then you have two choices .

        1. Do not pay third premium and save that 10,000
        2. Pay 10,000 more as 3rd premium and then get 6,000 back at the end of 3rd year (30% of 2 premium)


  322. Suresh says:

    Hi Manish and Readers,

    After going through this article few days ago, I decided to cancel my LIC Surabhi (15 Years Plan). I paid 2 Premiums so far. I went to LIC office to request to cancel my plan and refund me, but they did not refund, and instead said to stop paying the premiums.

    I have not got my refund, but I am deciding to stop paying premiums and stop getting cheated by LIC.

  323. dev says:

    jindagi ka saath bhi jindagi ke baad v lic bima karao jiban ujjwal banap

  324. samir says:

    It insurance policy. You should not expect interest on it.

  325. S.Murugesan, Tirunelveli, TN says:

    Hi Manish Sir,

    Your articles on insurance are elaborate and great. Thanks for your contributions.. I have an issue. My friend cum LIC Agent desires me to open a Jeevan Anand Policy in the name of my son (23yrs now) for a tenure of 20yrs with SA Rs 15,00,000 and the annual premiun works out to be Rs 52,374/=. He assured that by the end of 20 yrs, the LIC would pay Rs 40,00,000/. It looks attractive and i am still doubtful after reading many of your articles above. Please clarify whether i should go ahead or stop it. In case, I accept the policy, how much my son would get at the age of 43.. please update me ..

    1. No , you should not take, there is no guarantee of 40 lacs like this, ask him to provide this guaranteed sum (40 lacs) written on LIC bond . he wont be able to .

      Ask him what is the final return at the end of 20 yrs (in %) and proof of it!

      1. S.Murugesan says:

        Thanks Mr. Manish for your timely and valuable guidelines.

      2. Curious says:

        What is the GUARANTEED return in mutual funds or equities then? What’s wrong with you? The only thing you seem to be good at is bashing LIC…lol. God Bless. May mutual funds protect your family and make you a LOT of money.

  326. someshwar says:

    hello sir i want invest money yearly rs 100000 which is best plz advise me some other mode of saving and security plan so as to grow my money…….

    1. What are your goals and risk appetite ?

  327. Nilufer says:

    Thank you so much Manish, for your always so prompt reply…

    yes, you are right… i am getting an IRR of just 4%!!! really amazing, how we give so much of our hard earned monies to LIC and all we get in return in pennies… i will right away stop payments of premiums to all my policies…

    For my last two Money backs which have only completed 3 years (stated in 2009 and 2010), what do you suggest i do… surrender them..or let them be for 20 years? As you say if made paid up only after 3 years, we would not get any bonus… pls suggest… I have paid nearly 14000 x 3 = 42000/- towards each of the two policies…On surrendering i may hardly get 9000/- towards each policy..

    Thank you for all your help, Manish.. God bless you for saving me from such a blunder.. till date i was putting monies in these policies, trying to save for my retirement!!!! now have started SIPs from next month, for a period of 10 years.. hope to get better returns than 4% 🙂


    1. Surrendering is a tough option in short term , but good in long term . I suggest better surrender it


  328. suriyen says:

    Hi Manish Chauhan ji,

    I am getting 27 yrs. I want to open a premium around 20000 p.a.

    Which one is the best?

    1. What do you mean by “open a premium” ?

      1. suriyen says:

        Taking a new policy.

        1. LIC policies are not recommended at all .. you can invest in Mutual funds

  329. Abhishek says:

    I am having LIC jiban saral started 10 months back..49000 per yr.What should I do?

    1. Abhishek

      It will give you 4-5% return over long term, its highly illiquid also , what do you think you should do in this case ?

  330. Sapan says:


    Can you guide me to start my Investment. As if now, I have only few FD’s and want to started with right bases. ll be very thankful to you. Becoz guidance is the first step to any Investment. Married, wid no kids yet. Earning ard 50k per month.


    1. Sapan

      I think you should get started with Mutual funds, open an account with FundsIndia as they support NRI’s mutual funds investments , they will take care of rest , just contact them . if you are very new, I would say dont hurry and worry , Learn about things in next 3-6 months and then take actions


    2. Sapana says:


      Can you tell me how to contact them.


      1. ..

  331. Sapan says:

    Hey Mainshji,

    Pls help me to create username and password for the following email Id. As it is showing error when I m trying to do so…


  332. chandra says:

    I am a little confused. Is there any difference in final returns in making a policy paid up after 3 years or 5 years of premium paymen? In the chart at the top of your article you mention 5 years to get accrued bonus and later in the text you mention 3 years.

    1. Chandra

      yes .. if you make it paid up after 5 yrs, then you also get the bonus accrued till date , if you make it paid up before 5 yrs, you dont get bonus


  333. saurabh says:

    my second question is that .. does lic term plan amulya jeevan covers for accidental death only or does it covers for natural death ..death by illness like cancer ..heart attack etc….

    1. Saurabh

      It covers all kind of deaths . All the term plans does

  334. saurabh says:

    thanx manish for ur quick response….i want to buy a term plan from lic …should i wait for few more months bcoz it says that lic is working out on its term plan to lower its premium..and second what should b the sum assured for me annual income 6 lakhs….. plz guide me………

    1. Saurabh

      You can wait , but the thing is you will be uncovered for that much time . Its your call .

      For how much cover you need , better you use our insurance calculator :

  335. saurabh says:

    dear manish…
    i am a lecturer age 34 years ..i was planning for a jeevan anad policy for 8 lakhs sum assured for 28 years ..but with your article and nice calcuation..i m hesitant now…? shold i take term plan instead of jeevan anand? if yes which one would u suggest for 30 lakhs sum assured and period of 25 years? plz suggest me some other mode of saving and security plan so as to grow my money…….
    saurabh shukla

    1. Saurabh

      Dont take any endowment plan. Better take a term plan and just put your money in balanced funds each month for long term .. You can take a term plan from the company you trust like LIC , KOtak , ICICI , HDFC etc


    2. PRAKASHKUMAR .P says:

      If you take a Term Insurance Plan of Rs. 30 lakhs for 25 years, So in this mean time i.e. for the time of 25 years (or Premium Paying Term for 25 years) only you will be having Insurance protection after 25 years if you died means your family will not even get One Rupee from any Insurance Company. So if you die then only your family will be survived otherwise the money what you had paid will not be come back. So as per my plan first if you are having enough savings for your family’s future then you can go to any Term Insurance Plans.

      1. Prakash – I am surprised you say Term Insurance is for big business people alone and that you are a Insurance advisor? My Gosh.

        Do you know to calculate the IRR on the plans that you sell? I bet not.

        If you take a term plan for the same coverage as a LIC policy and invest the rest (premium paid for LIC policy minus premium paid for Term insurance) in PPF alone the returns will be astounding. Split this amount between a Mutual fund portfolio and PPF and chances are you come out extremely successful.

  336. Gajjan says:

    i have jeevan saral policies ( Paid 4*60,000 =2,40000)premium.What should i do ?
    What amount i will get after 5 years paying premium ?
    It will be advisible to pay 10 year premium , as it will add the loyalti addition ?


    1. Gajjan

      You are now very clear what happens in case of surrender / paid up / continuing the policy . So decision is all yours

  337. Sunil says:


    Can you please let me know from where can I get the terms and conditions of any LIC policy? It’s not there on LIC’s website.


    1. Sunil

      Its all there in the website . which policy are you looking for . Also if you have bough the policy then it will all be there in the policy document

  338. Manish says:

    Hi manish,

    Great article. I have so many policies from Lic, i dont have any issues with lic. But i joined a policy from reliance through a friend. Its 5000 yearly, when i noted the sum assured its only 57400 only as i am paying around(85000) for 16 years only. Its moneyback in every 4 years. They only giving the sum assured as money back.

    1. Manish

      Money back plans from reliance or any other company (even LIC) will be giving you very small returns (in percentage) , they are not the best choice .

  339. Amit says:

    Hi Manish,
    Thanks its very useful, as all your posts are!
    I m looking for a LIC plan specially for pension plan, got to know abt Jeevan Tarang. Can you suggest how it works and it be fruitfully in long run for 15 yrs. I am of 30 yrs.


  340. Rashmi says:

    Hi Mr. Manish,

    gud article..

    I m looking for a LIC plans which pays me back at intervals , got to know abt Jeevan Rekha. Can you suggest how it works and ll it be fruitfully in long run for 10 yrs. Also looking for some plan for my husband too which give us good saving and health cover. we both r 28 yrs.


    1. Rashmi

      Thanks for asking the question. We use our forum to answer personal questions , so that more people can have a look at it and give their comments too . Please ask your question on the forum where I personally and others reply very fast . It takes 1 min to create a login and start asking question .. Incase you want me to create a login/pass – let me know

      1. Rashmi says:


        pls help us in creating the login / password. When trying to do , it is showing Email Id already exists.


  341. Bharath Kondam says:

    Hi Manish,

    Great Job in articulating the summary of Insurance products. I agree with you in essence that India progressing with high rate of inflation. By which you can have a strong argument, but we can’t conclude because of same reason. Look at America, Inflation of the country is flat for last 25 years, now all old people who invested in AIG are the wealthiest people. So your argument has weight-age when inflation is high. So culprit is Inflation which makes you feel all insurance products not a good option to invest. Govt. of India need to stop the high inflation regime.

    1. Yes agree .. but my comments are on assumption that for some more decades the inflation in india will remain good enough .

  342. Bimal says:

    Manish, my issue on Jeevan Saral requires some more clarification. If I continue till 4th or 5th year and then surrender as you have suggested, how it will be gainful for me? Also, there is a provision for partial surrender of the policy – what exactly it is?


  343. Bimal says:

    Thank you Manish for your quick response. Please suggest a few short term and long term investment options for making wealth.

    Wish you better and better!


    1. Bimal

      Long term options , I only suggest Equity products like mutual funds . for short term , you cant make wealth , it can only grow marginally ! .. FD’s are the options !


  344. Deepak says:

    Hello Manishsir,
    If I deposit rs. 100000/- each in same bank but in two different branches(i.e. one lakh in each branch) then how much money is insured is it rs. 100000/- total or both Rs. 200000/- because they are deposited at two different branches of same bank.
    In addition sir plz let me know how good is the Tamilnad Mercentil bank if I deposit my money in its two different branches . safest or not?
    Are there any sort of bonds or FD which are completely tax free just like the earlier RBI tax free 6.5% bonds.
    Thanking u. Plz reply.

    1. The total insured in each BANK is upto 100,000.

      TMB is a stable bank – you can deposit money there.

      Tax free bonds may be bought in the secondary market but the yields are low – there are no fresh issues open now.

  345. Bimal says:

    My question is to Monish to suggest on the following:
    I invested in LIC Jeevan Saral in 2010 through monthly deduction of Rs. 9000/per month which is more than one lakh in a year. I have not completed three years yet. What to do now? Should I surrender now or complete 3rd year and go for paid up option? Same problem is with HDFC Endowment Supreme where I had paid for last 2 years one lakh per annum but dnot want to continue more. How to get rid of it with minimum losses? And what are other best investment options for less than 5 years and more than 10 years?


    1. Bimal

      You can surrender your LIC policy after 4th or 5th year and better stop paying premium for your HDFC plan


  346. Ganesh Sinha says:


    As many commented, I definitely think you are associated with some private insurance company. If you want to say endowment policies are not good, please be generic and don’t be particular with LIC. Your entire website talks ill about LIC. I don’t know if this is because of your personal or professional conflicts of interest.


    1. Ganesh

      LIC has 95% of endowment market , so I think putting the LIC name is very appropriate and almost 19 out of 20 people have LIC product only , so it connects with readers better .

  347. Lehman created several of these products – true. It is like playing with fire. Let me summarize this for everyone’s benefit.

    Bank A gives a loan to Person A to buy house. Lehman then bought this loan from Bank A and securitized it – means they sold bonds based on expected future income stream from person A. Now one person’s loan will be a small amount. Say – USD 300,000. So I-Banks bought these loan assets from banks for several thousand persons, securitized them and sold them. Infact even within this asset sale they grouped it – saying Tranche 1 payments will be received by Group 1 of investors. It will be the first set of payments received. Some of them were even AAA rated. Lower tranches had more % yield and were rated lower. I-Banks estimated that even if 40% people default this can continue. If people like person A paid back the loan installments on time there would have been no financial crisis – literally. Unfortunately that was not to be.

    Though Lehman created these products if the distributors sold them to pensioners and families the fault – to some extent lies with the buyer as well. Misselling cannot happen without misbuying. Like we cannot blame only LIC and agents for selling poor performance products – buyer is at blame too for not asking the right clarifications.

    There is no scam here in Lehman. Ofcourse commissions were taken for the product as with ANY FINANCIAL PRODUCT. But as I said if everyone paid their dues there would not have been any trouble, really. Lehman was a USD 42 Billion capitalization firm and was thought of as a small fish (though extremely infuential in the market). Perhaps if they had been bailed out the financial crisis would not have attained such major proportions – their fall was like a breaking of a dam. But that is my personal opinion.

    The products sold obviosuly came with disclosures – as transparent as it can be – that investing in them included risks of substantial losses including loss of capital. Who cared? INvestors – no!

    You need to understand and agree that Mutual Funds in India are not even allowed to hedge their positions by buying/selling derivatives. They purely buy and sell securities and bonds/CDs/CPs. Granted they can buy junk bonds as well but the overall benefits far outweigh the risks and losses.

  348. I ofcourse know the Lehman story first hand even as it was unfolding in Jun/Jul 2008 as I also shorted the stock at $29 some 25 days before the bankruptcy and was literally outside Lehman on Sep 15, 2008 Monday as I worked 1 block away in NYC.

    The point is – where do you see the scam and why do you think LIC policies are better?

  349. Gnanesh V says:


    READ ON FURTHER… source:

    Financial fallout

    Lehman’s bankruptcy was the largest failure of an investment bank since Drexel Burnham Lambert collapsed amid fraud allegations 18 years prior. Immediately following the bankruptcy filing, an already distressed financial market began a period of extreme volatility, during which the Dow experienced its largest one day point loss, largest intra-day range (more than 1,000 points) and largest daily point gain.

    What followed was what many have called the “perfect storm” of economic distress factors and eventually a $700bn bailout package (Troubled Asset Relief Program) prepared by Henry Paulson, Secretary of the Treasury, and approved by Congress.

    The Dow eventually closed at a new six-year low of 7,552.29 on November 20, followed by a further drop to 6626 by March of the next year.”


    “The fall of Lehman also had a strong effect on small private investors such as bond holders and holders of so-called Minibonds. ”

    In Germany structured products,
    often based on an index,
    were sold mostly to
    private investors,
    elderly, retired persons,
    students and families.

    Most of those now worthless derivatives were sold by the German arm of Citigroup, the German Citibank now owned by Crédit Mutuel.

  350. Gnanesh V says: article on BBC detailing about collapse of Lehman…..

    “Last Days of Lehman Brothers

    The Last Days of Lehman Brothers summarizes the events that occurred over the weekend preceding Monday 15 September, 2008, when Lehman declared bankruptcy.

    Investment bank Lehman Brothers is in trouble after a turbulent six months in which their real estate investments have lost billions of dollars, causing steep drops in Lehman’s stock. Lehman’s boss, Dick Fuld (Corey Johnson), who brought the firm through other crises, is himself growing desperate.

    Fuld’s plan to spinoff the company’s bad assets into a separate company does not satisfy investors, and Lehman stock drops by 75% in one week. Fuld’s only remaining solution is to have Lehman acquired. Both Bank of America and Barclay Bank are interested in purchasing the firm but are dissuaded because so much of Lehman’s assets are “toxic”, worthless.

    Lehman’s problems have put the US government in a delicate position. The collapse of a firm of Lehman’s size would have catastrophic economic repercussions well beyond the firm itself. Because there is no political support for a government bailout of the firm, the government turns to Lehman’s competitors for help. Late on the afternoon of 12 September, Friday, the leaders of the top investment banks on Wall Street, Lehman’s competitors, are summoned to the Federal Reserve Bank of New York. American Treasury Secretary Hank Paulson warns the incredulous group that Lehman is not too big to fail and that there will be no bailout using public money. Instead, Paulsen cajoles the bank heads to work out some joint plan among themselves to relieve Lehman of its toxic assets, warning them that the steep price they would pay to save Lehman would be easily outweighed by the cost of its failure. He also intimidates the bank heads by reminding them that they too will soon need help. A solution must be found before trading opens in Japan on Monday morning.

    By Friday evening, Bank of America begins stalling the deal, noting that Lehman’s valuation puts them “underwater” by billions of dollars. Fuld must now depend on Barclays, and he is clearly growing more desperate. Retaining hopes that Bank of America will change its mind, Fuld has the firm’s attorney Harvey R. Miller (Richard Durden)begin drafting a bankruptcy petition.

    As Paulsen’s group searches for alternatives, Lehman’s assets are subject to “valuation” by analysts from other firms. The analysts spend the night pouring over boxes of paperwork. Calculation is made extremely difficult because much of the assets are based on CDO instruments whose value is difficult to assess.

    Discussion continue at the Fed throughout Saturday with little result. John Thain of Merrill Lynch (Ben Daniels) pulls out of Paulsen’s bailout group, telling Paulsen that his company is in discussions with Bank of America. As they are no longer committed to Lehman, Bank of America is free to consider acquiring Merrill Lynch, which desperately needs the deal. Since the prospect of acquisition makes it less likely that Merrill will need help from the Fed., Thain has little incentive to continue participating in Paulsen’s discussions. As Thain leaves, he learns from Paulsen of the Fed’s plans to bailout AIG, whose Credit default swaps insure half of the western world’s banking system.

    By Sunday morning, Fuld receives word that Barclays has agreed to acquire Lehman Brothers, saving it. Jubilation is short-lived. Under British law, Barclays cannot guarantee Lehman’s debts until its own shareholders vote on the matter, and that will not happen until Tuesday – beyond the Monday morning deadline. Paulsen reiterates that the Fed will not “back stop” Lehman, not even for the 2 days it will take for Barclays’s shareholders to vote. With no chance of a buyout,

    Lehman has no choice but to file for bankruptcy. Lehman’s CFO signs the petition just minutes before the midnight deadline. A devastated Fuld leaves his office as Lehman’s now unemployed staff cleans out their desks.”

  351. Lakshmi says:

    Hi Manish

    I have taken Jeevan surabhi policy for 15 years and my premium is 132000/- per year. I have completed 1 yr and I saw your article. Yesterday I took my bond and saw my Sum assured is just 1200000Rs. Am paying 1584000Rs for 12 yrs for which am getting just 1200000Rs. I saw these people talking about 6-7% interest. Thats nothing. I want to stop paying my premium as early as possible. If I stop paying my premium after 2 more years, I would have completed 3 years of premium paying terms. Am not planning to surrender. So after 15 years what would be my returns. Am I going to get all my 3 premium paid + bonus or just 2 yrs premium + bonus? Please advice as am paying 132000Rs which is a huge amount.

    1. Laksmhi

      You are talking about “Paid up” option, inwhich case you will get all 3 premiums only (No bonus) . So it will turn out to be slightly better than 0% return !


  352. Gnanesh V says:

    Dear JustGrownMoney,

    Lehman Brothers scam what you have stated is not true. I happened to see 2 reports in BBC.

    The first one was on South Korea. People have invested in Lehman Bros, and other mutual funds their entire Pension Corpus. The worst tragedy that happened in 2007 was people getting pension from these Mutual Funds, Lehman Bros. in the age group of 65-75, became penniless in 2007. They had to restart to go for some petty job to see that they get food. Infact I remember seeing an erstwhile Admin Manager started to work at age 68 as a TAXI DRIVER because his entire pension corpus was swept away overnight.

    The second report I saw was also in BBC some six months ago. Financial Market scam has put a dignified pensioner in Malaysia to become a SERVER at age 70.

    I think we are missing one major point. Getting money out of Mutual Fund at a specific period say 10 years from now, this much amount… is never a reality. Suppose if one had invested at age 45 in year 1998 with a view to take money out after 10 years. Stock markets crashed in 2008 and Mutual Fund values were down 70-75% down. If this person has an obligation to educate his son, he would never be able to do so. All Mutual fund Pundits will say wait 2-3 years, and realise your money later at higher NAVs.

    How will the pathetic investor feel when his objective of educating his son could have to wait for 2/3 years.

    So, my inference stays. I will continue with LIC and all my other investments in all avenues. It will be stupid for me to surrender any plan. I will not expose my self to mutual fund beyond one-tenth of my investible surplus.

    In my analysis out of 1500 odd mutual fund schemes which have been floated in the last 15 years, only 75-80 schemes have really given a yield of 12-15% compounded yearly. 0ther 250 companies have given a yield of 8-12 %. Further 600 odd schemes have given below 8% yield. Rest schemes have given negative yield.

    From my analysis, salaries paid to Mutual Fund managers are mind boggling… 10 times that of a manager in a Bank or LIC noway comparable. Why I should pay such exorbitant sum for maintaining sub-optimal investment with no guaranteed exit point

    1. There is a world of difference between the word SCAM and an investment losing value. SCAM is simply swindling money. In case of Lehman Brothers – I repeat – there was NO SCAM. They sold loans as assets with expected future payments – when those payments stopped/slowed the entire CDO market came down and it is a separate discussion in itself.

      As part of sound financial planning one is supposed to move to Debt 2-3 years before the stipulated date of use of funds. If someone has moved to Debt in 2005 their corpus would have survived. For people who wanted money in 2011 the crash of 2008 put them behind but has not the markets come back as much as in 2008. Except for the great depression of 1929 no market downturn has been longer than 3-4 years.

      A LIC Agent gets about 40% of the initial investment as commission. Then about 1-2% on an ongoing basis.

      Return on Endowment plans: 7%
      Commissions and costs: 2%
      Net return: 5%
      Commission as % of return = 28%

      Return on MFs: 10% -12% at the average end – 18% long term average
      Commissions and costs: 2.25%
      Net return: 10% to 16%
      Commission as % of return = 14% to 22.5%

      Now you see who takes more cut of money -as a percentage of returns! For LIC the money is split among 1000’s of agents while it is concentrated for MF managers – thats all.

      Low exposure to equities is a guaranteed way to mishandle future planning I can be as blunt as that. As said before – to each his own!!