LIC's New Children's Money Back Plan 732

LIC's New Children's Money Back Plan 732: A Comprehensive Guide

LIC's New Children's Money Back Plan 732 is a specialized traditional insurance plan designed to help parents and guardians secure their child's future through regular periodic payouts and a guaranteed maturity benefit. Tailored for children, it not only provides life insurance but also builds a corpus for important milestones such as higher education, marriage, or other major life goals. This article provides a complete overview of the plan, including its eligibility, features, benefits, tax advantages, and how it compares with similar products.

Introduction to LIC's New Children's Money Back Plan 732

LIC's New Children's Money Back Plan 732 is a participating, non-linked, money-back plan that offers both protection and savings. It is specifically designed to meet the long-term educational and financial needs of children. The plan operates by paying out a portion of the sum assured at defined intervals (known as survival benefits) and providing a lump sum at maturity. This structure ensures that the child can receive funds at crucial points in life, making it a valuable tool for parents seeking financial security for their children.​

LIC's reputation for reliability and trust makes this plan a popular choice for families seeking a secure, guaranteed investment with periodic liquidity. The plan is non-linked, meaning returns are not subject to market risks, and it participates in LIC's profits, which further enhances the potential for additional returns in the form of bonuses.

Why Choose LIC's New Children's Money Back Plan 732?

Parents and legal guardians opt for LIC's New Children's Money Back Plan 732 for several compelling reasons:

• Guaranteed Periodic Payouts: The plan ensures that the child receives a portion of the sum assured at ages 18, 20, and 22, which can be used for major life events such as admission to higher education, marriage, or starting a career.​

• Maturity Benefit: At the end of the policy term, the child receives the remaining sum assured along with any accrued bonuses, providing a significant lump sum for future needs.​

• Life Insurance Coverage: The plan offers life cover for the child during the policy term, adding a layer of financial security.​

• Tax Benefits: Premiums paid are eligible for tax deductions under Section 80C, and the maturity/survival benefits are tax-free under Section 10(10D), making it a tax-efficient investment option.​

• Flexibility: The policy allows for flexible premium payment options and the option to defer survival benefits if needed, providing adaptability to changing financial situations.youtube​​

Who is Eligible for LIC's New Children's Money Back Plan 732?

Understanding eligibility is crucial for selecting the right insurance plan. Here are the detailed eligibility criteria for LIC's New Children's Money Back Plan 732:

Entry Age

• Minimum age: 0 years (newborn baby)

• Maximum age: 12 years (at the time of policy purchase)​

Policy Term

• The policy term is determined by the entry age of the child.

• The maturity age is fixed at 25 years.

• For example, if the child is 5 years old at entry, the policy term will be 20 years (25 - 5 = 20 years).​

Policyholder

• The policy can be purchased by a parent or a legal guardian.

• Grandparents can also purchase the policy if they are the legal guardians.​

Premium Payment Options

• Premiums can be paid annually, half-yearly, quarterly, or monthly, depending on convenience.​

• Rebates are available for choosing annual or half-yearly payment modes.​

Sum Assured

• Minimum sum assured: ₹2,00,000 (subject to change by LIC)

• No upper limit; the sum assured can be chosen based on financial needs and proof of income.​

Medical Requirements

• For higher sum assured amounts, medical tests may be required as per LIC's underwriting guidelines.​

Key Features of LIC's New Children's Money Back Plan 732

1. Survival Benefits

• The child receives 20% of the basic sum assured at ages 18, 20, and 22, provided the policy is in force.​

• Example: If the basic sum assured is ₹10,00,000, the child will receive ₹2,00,000 at age 18, another ₹2,00,000 at age 20, and ₹2,00,000 at age 22.

2. Maturity Benefit

• At the end of the policy term (age 25), the child receives the remaining 40% of the basic sum assured plus any accrued bonuses.​

• Example: With a sum assured of ₹10,00,000, the maturity benefit will be ₹4,00,000 plus bonuses.

3. Death Benefit

• If the child passes away during the policy term, the nominee receives the sum assured on death, which is the higher of:

  • Basic sum assured

  • 7 times the annual premium

• Additionally, any accrued bonuses are also paid.​

4. Bonus Participation

• The plan participates in LIC's profits, which results in the addition of bonuses to the policy.​

• Bonuses are declared annually and are paid at maturity or on death.

5. Premium Waiver Benefit Rider

• An optional rider is available for an additional premium, which waives future premiums if the policyholder (parent/guardian) passes away during the policy term.​

• This ensures the policy continues to provide benefits for the child.

6. Surrender Value

• The policy acquires a surrender value after 1 year.

• Partial or full surrender can be done if needed, subject to LIC's terms.​

7. Option to Defer Survival Benefits

• The policyholder can choose to defer survival benefits for higher returns, if required.youtube​​

8. Settlement Option

• The policyholder can opt to receive maturity or death benefits in instalments, providing flexibility in accessing funds.​

How LIC's New Children's Money Back Plan 732 Works: An Example

Let’s consider a scenario to illustrate the plan’s workings:

• Child’s Age at Entry: 5 years

• Sum Assured: ₹10,00,000

• Policy Term: 20 years (maturity at age 25)

• Survival Benefits: 20% of sum assured at ages 18, 20, and 22

  • ₹2,00,000 at age 18

  • ₹2,00,000 at age 20

  • ₹2,00,000 at age 22

• Maturity Benefit at Age 25: ₹4,00,000 plus bonuses

• Total Payout to Child: ₹8,00,000 (survival benefits) + ₹4,00,000 (maturity) + bonuses

This structure ensures that the child has access to funds at key life stages, with the potential for additional returns through bonuses.

Documentation Required

• Birth certificate of the child

• Identity and address proof of the parent/guardian

• PAN card (for tax purposes)

• Completed application form

• Medical reports (if required for higher sum assured)

Comparison with Other Child Plans

Feature	LIC's New Children's Money Back Plan 732	Other Child Plans (Market)
Guaranteed Returns	Yes (fixed + bonuses)	Varies (market-linked or fixed)
Survival Benefits	Yes (at ages 18, 20, 22)	Varies (some offer periodic payouts)
Maturity Benefit	Yes (fixed + bonuses)	Varies
Death Benefit	Yes (sum assured + bonuses)	Yes
Bonus Participation	Yes (LIC profits)	Varies (profit-sharing)
Tax Benefits	Yes (80C, 10(10D))	Yes (plan-dependent)
Flexibility in Premium Payment	Yes (annual, half-yearly, etc.)	Varies
Surrender Value	Yes (after 1 year)	Yes (varies)
Risk Factor	Low (non-linked, guaranteed)	Varies (market-linked or fixed)

Frequently Asked Questions

Q1. What is the minimum and maximum age for entry?

• The child must be between 0 and 12 years old at entry.​

Q2. Can I pay premiums monthly?

• Yes, premiums can be paid monthly, quarterly, half-yearly, or annually.​

Q3. What happens if the child dies before maturity?

• The nominee receives the sum assured on death plus any accrued bonuses.​

Q4. Are there any riders available?

• Yes, the Premium Waiver Benefit Rider is available for an additional premium.​

Q5. Is the plan eligible for tax benefits?

• Yes, premiums are eligible for tax deduction under Section 80C, and the maturity/survival benefits are tax-free under Section 10(10D).​

Q6. Can I surrender the policy?

• Yes, the policy can be surrendered after 1 year, subject to LIC's terms.​

Conclusion

LIC's New Children's Money Back Plan 732 is a robust, secure, and flexible investment option designed to meet the financial needs of children. Its unique combination of guaranteed periodic payouts, lump sum maturity benefit, life insurance coverage, and tax advantages makes it a top choice for parents and guardians seeking financial security for their children. The plan's flexibility, transparency, and participation in LIC's profits ensure that families can build a strong financial foundation for their children's future, with the peace of mind that comes from a trusted, government-backed insurer.