New LIC Plans Policies

Commission Derive the Sales - How Agents push you the insurance plans?

Agents push endowment and money back plans, which fetch them higher commissions even though the returns are very low.

See the below list to be prepare while taking any life insurance plans:

Pure term Plans: Best form of insurance but projected as a waste of money.
Ulip: No longer favorite because of the low commissions.
Money Back Policy: Very costly plan. People may not even need the periodic payments.
Endowment Plan: Most popular plan because of the high commission.

What will change for Life Insurance Policies from 1 January in LIC

Agents are spreading the rumors to generate more sales before 1 January 2013. but in actually Insurance Policies will become more customer Friendly after 31 December. Below are some changes:

High Surrender Value: Till now if you cancelled a policy prematurely, the surrender value was calculated without taking into account the first years premium. the new rules says that the surrender value must be at least 30% of the total premium paid.
Shorter Minimum Period: Currently, you have to pay at-least 3 annual premiums to eligible for surrender value. after the IRDAs new rule, those policies who are having premium paying term less than 10 years can surrender after 2 years and more than 10 years premium paying term policy will have same 3 minimum years.
Higher Insurance Cover: If the Policyholder is upto 45 years old, the insurance cover must be atleast 10 times the annual premium. for those above 45, the cover can be up to 7 times the annual premium.
Lower Commission for Agents: Now it will depend upon the premium paying term.
8 Years PPT – 24% Commission for 1st year.
10 Years PPT – 30% Commission for 1st year.
12 Years and More PPT – 35% Commission for 1st year.
Lower Premium for LIC: Now Term insurance premium will be cheaper than earlier it was.

List of LIC plans closing in 2013 before december

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Since last 3 to 4 months, we came to know that IRDA says LIC to take service tax on all LIC plans. previously LIC itself was paying the service tax but now policy holder will pay service tax. This will increase the premium of LIC plans. But whoever have taken the plan and will take the LIC plans before 31 December will pay the less premium.

LIC of India has decided they will close almost 47 plans and bring new one with included service tax.

Below are the list of LIC plans which are closing in November and December.

ALL LIC PLANS WILL BECOME EXPENSIVE AFTER 31st December 2013

Plan no.58/52/43/811/41/50/8 closing on 15/11/2013
Plan no:806/2/88/805/167 closing on 23/11/2013
Plan no.812/164 closing on 30/11/2013

Below are the list of LIC Plans closing before Jan 2014

List of LIC plans closing in 2013