LIC's Bima Ratna (Plan No. 764) is a non-participating, non-linked, individual savings life insurance plan designed to offer both financial protection and guaranteed savings. It is a money-back plan that provides periodic survival benefits during the policy term, along with a lump sum maturity benefit and a robust death benefit. This plan is ideal for individuals seeking a disciplined savings approach with life cover, periodic liquidity, and guaranteed returns. Below is a comprehensive, detailed article covering all aspects of LIC's Bima Ratna 764, including its features, eligibility, benefits, premium structure, riders, and practical considerations.
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Overview of LIC's Bima Ratna 764
LIC's Bima Ratna is a non-linked, non-participating, individual savings plan that combines insurance protection with guaranteed savings. Unlike traditional endowment plans, Bima Ratna offers periodic survival benefits (money-back) during the policy term, making it suitable for those who want liquidity at specific intervals. The plan is available in three policy terms: 15, 20, and 25 years. The premium payment term is shorter than the policy term, allowing policyholders to pay premiums for a limited period while enjoying coverage for the entire policy duration.
The plan is non-participating, meaning it does not offer bonuses or share in LIC's surplus. All benefits are guaranteed and fixed, providing certainty and predictability. This makes Bima Ratna an attractive option for risk-averse individuals who prefer guaranteed returns over market-linked products.
Key Features of Bima Ratna 764
1. Protection and Savings Combination
Bima Ratna offers a dual benefit: life insurance coverage and savings. In case of the policyholder's unfortunate demise during the policy term, the nominee receives a substantial death benefit. If the policyholder survives, they receive periodic survival benefits and a lump sum maturity benefit. This combination ensures financial security for the family and disciplined savings for the policyholder.
2. Limited Premium Payment Term
The premium payment term is shorter than the policy term. For a 15-year policy, premiums are paid for 11 years; for a 20-year policy, premiums are paid for 16 years; and for a 25-year policy, premiums are paid for 21 years. This feature allows policyholders to pay premiums for a limited period while enjoying coverage for the entire policy duration.
3. Guaranteed Additions
The plan offers guaranteed additions throughout the policy term. These additions are paid per ₹1,000 of basic sum assured and increase over time:
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₹50 per ₹1,000 for the first 5 years
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₹55 per ₹1,000 for years 6 to 10
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₹60 per ₹1,000 for years 11 to 25
Guaranteed additions are paid on death, maturity, or surrender, providing an additional return on the policy.
4. Survival Benefits (Money-Back)
Bima Ratna provides periodic survival benefits during the policy term. The percentage of the basic sum assured paid as survival benefit is 25% at specific intervals:
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For a 15-year policy: 25% at the end of the 13th and 14th policy years
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For a 20-year policy: 25% at the end of the 18th and 19th policy years
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For a 25-year policy: 25% at the end of the 23rd and 24th policy years
These survival benefits provide liquidity at crucial intervals, helping policyholders meet financial needs such as education, marriage, or other milestones.
5. Maturity Benefit
On survival to the policy maturity date, the policyholder receives 50% of the basic sum assured along with accrued guaranteed additions. This lump sum maturity benefit serves as a financial cushion for future needs.
6. Death Benefit
In case of the policyholder's demise during the policy term, the nominee receives the higher of:
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125% of the basic sum assured
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7 times the annualized premium
The death benefit is not less than 105% of the total premiums paid. This ensures that the nominee receives a substantial amount, providing financial security.
7. Flexibility in Premium Payment
Premiums can be paid yearly, half-yearly, quarterly, or monthly (monthly premiums through NACH only). This flexibility allows policyholders to choose a payment mode that suits their cash flow.
8. Rider Benefits
Bima Ratna offers optional rider benefits for enhanced coverage:
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Accidental Death and Disability Benefit Rider
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Accident Benefit Rider
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New Term Assurance Rider
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Premium Waiver Benefit Rider
These riders provide additional protection against accidental death, disability, or premium payment difficulties. The premiums for riders are additional and subject to eligibility.
9. Settlement Option
Policyholders can opt to receive maturity or death benefits in instalments over 5, 10, or 15 years instead of a lump sum. This option provides regular income and helps manage large payouts.
10. Loan Facility
After paying one full year's premium, policyholders can avail a loan against the policy. The maximum loan amount is up to 75% of the surrender value for in-force policies. This feature provides liquidity in case of emergencies.
Eligibility and Restrictions
1. Minimum and Maximum Sum Assured
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Minimum basic sum assured: ₹5,00,000
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Maximum basic sum assured: No limit
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Sum assured multiples: ₹25,000
2. Policy Term
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15 years
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20 years
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25 years
3. Premium Payment Term
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11 years for 15-year policy
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16 years for 20-year policy
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21 years for 25-year policy
4. Age at Entry
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5 years (completed) for 15-year policy
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30 days (completed) for 20-year and 25-year policies
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Maximum age at entry: 55 years for 15-year policy, 50 years for 20-year policy, 45 years for 25-year policy
5. Minimum Age at Maturity
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20 years (completed) for 15-year and 20-year policies
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25 years (completed) for 25-year policy
6. Maximum Age at Maturity
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70 years (age nearer birthday)
7. Risk Commencement
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For policyholders below 8 years at entry, risk commences either 2 years from policy commencement or from the policy anniversary coinciding with or immediately following the attainment of 8 years, whichever is earlier. For those aged 8 years or more, risk commences immediately.
Benefits in Detail
1. Death Benefit
The death benefit is the higher of:
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125% of the basic sum assured
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7 times the annualized premium
It is not less than 105% of the total premiums paid. For minor lives below 8 years at entry, if death occurs before risk commencement, the nominee receives a refund of premiums paid (excluding taxes and rider premiums) without interest.
2. Survival Benefit
Survival benefits are paid at specific intervals during the policy term:
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15-year policy: 25% at the end of 13th and 14th policy years
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20-year policy: 25% at the end of 18th and 19th policy years
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25-year policy: 25% at the end of 23rd and 24th policy years
These benefits provide periodic liquidity and help meet financial needs at crucial intervals.
3. Maturity Benefit
On survival to maturity, the policyholder receives 50% of the basic sum assured along with accrued guaranteed additions. This lump sum serves as a financial cushion for future needs.
4. Guaranteed Additions
Guaranteed additions are paid per ₹1,000 of basic sum assured:
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₹50 for years 1 to 5
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₹55 for years 6 to 10
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₹60 for years 11 to 25
These additions are paid on death, maturity, or surrender, providing an additional return on the policy.
Premium Structure and Rebates
1. Premium Payment Modes
Premiums can be paid yearly, half-yearly, quarterly, or monthly (monthly premiums through NACH only). This flexibility allows policyholders to choose a payment mode that suits their cash flow.
2. Mode Rebates
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Yearly mode: 2% of tabular premium
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Half-yearly mode: 1% of tabular premium
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Quarterly and monthly modes: No rebate
3. High Sum Assured Rebate
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₹5,00,000 to ₹9,75,000: No rebate
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₹10,00,000 to ₹14,75,000: ₹0.70 per ₹1,000 basic sum assured
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₹15,00,000 to ₹19,75,000: ₹1.00 per ₹1,000 basic sum assured
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₹20,00,000 and above: ₹1.25 per ₹1,000 basic sum assured
4. Online Sale Rebate
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11-year premium paying term: 7.5% rebate
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16-year and 21-year premium paying terms: 10% rebate
These rebates reduce the effective premium payable, making the plan more affordable.
Riders and Additional Benefits
1. Accidental Death and Disability Benefit Rider
Provides additional coverage in case of accidental death or disability. The accident benefit sum assured is paid in lump sum on accidental death or in monthly instalments over 10 years on accidental disability. Future premiums for the accident benefit sum assured and a portion of the basic sum assured are waived on accidental disability.
2. Accident Benefit Rider
Provides a lump sum payment on accidental death during the premium paying term. This rider is available for an additional premium.
3. New Term Assurance Rider
Provides additional term insurance coverage during the policy term. The term rider sum assured is paid on death of the life assured.
4. Premium Waiver Benefit Rider
Waives future premiums on death of the proposer during the premium paying term. This rider is available for an additional premium.
Practical Considerations
1. Revival of Lapsed Policy
A lapsed policy can be revived within 5 consecutive years from the date of first unpaid premium but before the date of maturity. Revival requires payment of all arrears of premiums with interest and satisfaction of continued insurability.
2. Paid-Up Value
If less than one full year's premium is paid and subsequent premiums are not paid, all benefits cease after the grace period. If at least one full year's premium is paid and subsequent premiums are not paid, the policy becomes paid-up. The paid-up sum assured is calculated based on the ratio of premiums paid to premiums payable.
3. Surrender Value
The policy can be surrendered after completion of the first policy year. The surrender value is the higher of guaranteed surrender value and special surrender value. Guaranteed surrender value is calculated based on premiums paid and accrued guaranteed additions.
4. Policy Loan
A loan can be availed after payment of one full year's premium. The maximum loan amount is up to 75% of the surrender value for in-force policies. The loan interest rate is competitive and subject to change.
5. Free Look Period
Policyholders have a 30-day free look period to review the policy terms. If dissatisfied, the policy can be returned for a refund of premiums paid, less proportionate risk premium and expenses.
6. Tax Benefits
Premiums paid under Bima Ratna are eligible for tax deduction under Section 80C of the Income Tax Act. Maturity and death benefits are exempt from tax under Section 10(10D).
Who Should Consider Bima Ratna 764?
LIC's Bima Ratna is suitable for individuals seeking:
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Guaranteed returns with periodic liquidity
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Life insurance coverage with savings
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Limited premium payment term
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Flexibility in premium payment modes
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Additional coverage through riders
It is ideal for those who want a disciplined savings approach with financial security for their family. The plan is particularly beneficial for individuals with specific financial goals, such as children's education, marriage, or retirement planning.
Conclusion
LIC's Bima Ratna 764 is a comprehensive money-back plan that combines insurance protection with guaranteed savings. Its key features include periodic survival benefits, guaranteed additions, limited premium payment term, and flexibility in premium payment modes. The plan offers substantial death and maturity benefits, making it a reliable choice for individuals seeking financial security and disciplined savings. With optional riders and a loan facility, Bima Ratna provides additional protection and liquidity. The plan is suitable for those who prefer guaranteed returns over market-linked products and want to meet specific financial goals with periodic liquidity
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