LIC Micro Bachat Plan is another budget-friendly plan launched by LIC of India in the category of micro insurance plan. Being one of the most trusted life insurance companies in India, Life Insurance Corporation continues to bring various types of life insurance plans throughout the year to help individuals plan their financial stages cost-effectively.
The Micro Bachat LIC plan provides a bunch of benefits to the policyholders that we will discuss further in detail.
What is LIC Micro Bachat Plan?
LIC Micro Bachat plan is a regular premium paying, non-linked, participating, individual life insurance plan offering the dual benefit of life risk cover and savings in a single plan purchase. LIC Micro Bachat Plan provides financial protection to the family members in case of the uncertain demise of life assured during the policy term. Additionally, if the life assured survives the policy term, they receive a guaranteed lump sum amount with the loyalty additions.
Highlights of LIC Micro Bachat Plan
Below are the key highlights of the LIC Micro Bachat Plan.
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Plan Type
Micro Insurance Plan
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Policy Term
10 to 15 years
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Grace Period
30 days
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Free Look Period
15 days
Eligibility Criteria of LIC Micro Bachat Plan
The LIC Micro Bachat Plan is available for all healthy individuals without any medical examination. To buy the LIC Micro Bachat Plan, the policyholder must meet the following eligibility criteria and restrictions.
| Particular | Specification |
|---|---|
| Entry Age | 18 - 55 years |
| Basic Sum Assured | Rs. 50,000 to Rs. 2 Lakhs |
| Policy Paying Term | Same as policy term |
| Max Maturity Age | 70 Years |
LIC Micro Bachat Plan Benefits
Individuals who purchase the LIC Micro Bachat Plan can get the following benefits.
Death Benefit
In case of the death of the life assured during the policy term, the family members receive the death benefits. The death benefits are not less than 105% of all premiums and are payable as:
When the life assured dies during the first five policy years: The nominee receives the Sum Assured on Death.
When the life assured dies after the completion of the first five policy years but before the date of maturity: The nominee receives the death benefits with the loyalty additions as mentioned.
Sum Assured on Death is higher of the following
- 7 times of annualised premium
- Basic Sum Assured
Maturity Benefit
If the life assured survives the entire policy term, they receive the maturity benefits with the loyalty additions. The Sum Assured on Maturity equals the Basic Sum Assured under the LIC Micro Bachat plan.
Loyalty Additions
The LIC Micro Bachat Plan is eligible to get guaranteed loyalty additions depending on the market experience and performance of the LIC of India. The loyalty additions are payable with the maturity and death benefits claimed, provided at least five years of premiums are duly paid.
LIC Micro Bachat Plan Premium Chart
Below are the annual premium rates of the LIC Micro Bachat Plan that will be applicable for Rs. 1,000 Basic Sum Assured.
| Age | Policy Term | ||
|---|---|---|---|
| 9 Years | 12 Years | 15 Years | |
| 18 | Rs. 85.45 | Rs. 68.25 | Rs. 51.50 |
| 25 | Rs. 85.55 | Rs. 68.35 | Rs. 51.60 |
| 35 | Rs. 85.90 | Rs. 68.80 | Rs. 52.20 |
| 45 | Rs. 87.60 | Rs. 70.75 | Rs. 54.50 |
| 55 | Rs. 91.90 | Rs. 75.40 | Rs. 59.80 |
* All the premium rates are reflected from the sources available on the LIC of India official website.
Additional Features of LIC Micro Bachat Plan 951
Except for the benefits mentioned, the LIC Micro Bachat Plan offers additional benefits that make the plan more attractive and enhance flexibility for the policyholder.
Premium Payment
The policyholder can pay the LIC premium regularly in monthly, quarterly, half-yearly, or annual modes per their financial suitability.
Grace Period
LIC Micro Bachat Policy offers a grace period of 30 days to make the due LIC premium payments. During this period, all the policy benefits are active. The policy lapses if the LIC premium payments are not made within the grace period.
Policy Revival
The revival of the lapsed LIC policy Micro Bachat is possible within a period of 5 consecutive years from the date of the first unpaid premium but before the date of maturity. For policy revival, the policyholder must pay all the outstanding premiums along with the interest, where the LIC of India decides the rate.
Paid Up Value
Suppose the policyholder makes the premium payment for less than one year, and any payment thereafter is not made even after the expiry of the grace period. In that case, the policy shall cease, and nothing is payable to the beneficiaries.
Say the policyholder pays the LIC premium payment for at least one year, and any further premiums are not paid. In such case, the policy shall not stand void but continue as a paid-up policy till the end of the policy term.
Auto Cover Period
The auto cover period is activated if the policyholder makes LIC premium payments for at least three years in the following manner:
- If only at least 3 years but less than 5 years premiums have been paid, and no subsequent premiums are paid, then an Auto Cover Period of 6 months is available.
- If only at least 5 years of premiums have been paid, and no subsequent premiums are paid, then an Auto Cover Period of 2 years is available.
Policy Surrender
The policyholder can surrender the policy anytime, provided at least one year of premiums have been duly paid. Upon surrender, the corporation pays the Surrender Value higher of; the Guaranteed Surrender Value and Special Surrender Value.
Policy Loan
The policyholder can avail of the loan under the LIC Micro Bachat Policy if at least 3 years of premiums have been duly paid. The maximum loan can be availed as
- For in-force policies: Upto 70% of the Surrender Value
- For paid-up policies: Upto 60% of the Surrender Value
The interest rates are declared by the LIC of India and approved by IRDAI.
Tax Benefits
Section 80C of the Income Tax Act, 1961 allows the policyholder to avail of tax benefits on the LIC Micro Bachat Plan premium. Also, the benefits received are tax exempted under Section 10 (10D) of ITA.
Free Look Period
A free look period of 15 days is offered under the LIC Micro Bachat Plan. During this period, the policyholder can review the terms and conditions after the policy purchase. In case they are not satisfied, they can return the policy after stating the reason for the objection. Upon receiving the receipt for the same, the LIC of India cancels the policy and returns the premium deposited after deducting any applicable charges.
Rebates
The LIC Micro Bachat Policy offers rebates/ discounts on the premium payment mode and a high basic sum assured in the following manner:
Modal Rebate:
| Mode of Payment | Rebate |
|---|---|
| Yearly | 2% of the tabular premium |
| Half-Yearly | 1% of the tabular premium |
| Quarterly | NIL |
High Basic Sum Assured Rebate:
| Mode of Payment | Rebate |
|---|---|
| Rs. 50,000 to Rs. 1,45,000 | NIL |
| Rs. 1,50,000 to Rs. 1,95,000 | Rs. 1.50% of the Basic Sum Assured |
| Rs. 2,00,000 | Rs. 2.00% of the Basic Sum Assured |
Riders Available Under LIC Micro Bachat Policy
The LIC Micro Bachat Plan offers two optional add-on riders that can be opted for by the policyholder anytime within the policy term, provided at least 5 years remain for the maturity of the base policy. The policyholder can pay the additional premium for any of the two riders.
LIC Accidental Death and Disability Benefit Rider
Suppose the policyholder opts for the LIC Accidental Death and Disability Benefit Rider, in case of accidental death, the nominee receives the Accident Benefit Sum Assured in a lump sum with the death benefit under the plan.
In case an accidental disability arises due to an accident (within 180 days of the date of the accident), the assured receives the Accident Benefit Sum Assured in monthly instalments for 10 years.
LIC Accident Benefit Rider
If the policyholder opts for this rider, in case of accidental death, the nominee receives the Accident Death Benefit Sum Assured in a lump sum with the death benefit under the base plan.
Exclusions Under LIC Micro Bachat Plan
Suicide committed under a certain period prevents the nominee from receiving predefined benefits under the LIC Micro Bachat Plan. The Micro Bachat 951 policy shall be considered void in the following circumstances
- If the life assured commits suicide at any time within 12 months from the date of commencement of risk, the LIC of India only pays 80% of the total premium paid upon claim.
- If the life assured commits suicide at any time within 12 months from the date of revival, the LIC of India only pays the higher of 80% of the total premium paid till the date of death or the surrender value upon claim.
Final Words
LIC Micro Bachat Plan is one of the cost-effective plans by LIC of India that offers a combination of life risk cover and savings benefits. You can contact the LIC branch or LIC agent to buy the Micro Bachat LIC plan. Find a LIC agent or life insurance agent nearby with the help of RenewBuy Advisor Connect.
With expert assistance, you can compare and buy suitable life insurance plans from LIC endowment, LIC child, LIC pension, LIC micro insurance, LIC whole plan, and others per your financial goals.
Once you purchase the plan, you can manage the LIC policy online using the LIC e-services platform. You need to log in to the LIC customer portal with valid credentials, and there you are, ready to use all the features like LIC policy tracking, LIC premium payment, LIC policy revival, LIC claim status, checking the LIC policy list, and update the LIC policy details.