KOMAL JEEVAN – (Table Nos.

159)
Benefit Illustration

Introduction

Insurance Regulatory & Development Authority (IRDA) requires all life insurance companies
operating in India to provide official illustrations to their customers. The illustrations are based
on the investment rates of return set by the Life Insurance Council (constituted under Section
64C(a) of the Insurance Act 1938) and is not intended to reflect the actual investment returns
achieved or may be achieved in future by Life Insurance Corporation of India (LICI).

For the year 2004-05 the two rates of investment return declared by the Life Insurance
Council are 6% and 10% per annum.

Product summary

This is a Children’s Money Back Plan that provides financial protection against death during
the term of plan with periodic payments on survival at specified durations. This plan can be
purchased by any of the parent or grand parent for a child aged 0 to 10 years.

Commencement of risk cover: The risk commences either after 2 years from the date of
commencement of policy or from the policy anniversary immediately following the completion
of 7 years of age of child, whichever is later.

Premiums:
Premiums are payable yearly, half-yearly, quarterly, monthly or through Salary Saving
Scheme, as opted by you up to the policy anniversary coinciding with or immediately following
the 18th birthday of the life assured or till the earlier death of the life assured. Alternatively, the
premium may be paid in one lump sum (Single premium).

Guaranteed Additions : The policy provides for the Guaranteed Additions at the rate of
Rs.75 per thousand Sum Assured for each completed year. The Guaranteed Additions are
payable at the end of the term of the policy or earlier death of the Life Assured.

Loyalty additions : This is a with-profit plan and participates in the profits of the
Corporation’s life insurance business. It gets a share of the profits in the form of loyalty
additions which are terminal bonuses payable along with death or maturity benefit. Loyalty
addition may be payable depending on the experience of the Corporation.

Survival Benefit: The percentage of sum assured as mentioned below will be paid on
survival to the end of specified durations:

On Survival till the policy % of Sum Assured

anniversary coinciding with or
immediately following the
completion of the age of
18 years 20%
20 years 20%
22 years 30%
24 years 30%
Death Benefit: In case of death of the life assured before the commencement of risk, the
policy shall stand cancelled and premiums paid (excluding the Premium for Premium waiver
Benefit ) under the policy will be refunded. However, if death occurs after the commencement
of risk but before the policy matures, the full Sum Assured plus Guaranteed Additions together
with Loyalty Additions, if any, is payable.

Maturity Benefit: The Guaranteed Additions together with Loyalty Additions, if any, is payable
in a lump sum on survival to the end of the policy term.

Premium Waiver Benefit: This is an optional benefit that can be added to your basic plan.
An additional premium is required to be paid for this benefit. By payment of this additional
premium, the proposer can secure the benefit of cessation of premiums from his/her death to
the end of the deferment period. The deferment period for this purpose is to be taken as 18
minus age at entry of child.

Surrender Value:
Buying a life insurance contract is a long-term commitment. However, surrender value is
available on the plan on earlier termination of the contract.

Guaranteed Surrender Value:

The policy may be surrendered after it has been in force for 3 years or more. The Guaranteed
Surrender Value before the date of commencement of risk is 90% of the premiums paid
excluding the premiums paid during the first year and any extra premium paid. After the date
of commencement of risk, the Guaranteed Surrender Value is 90% of the premiums paid
before the date of commencement of risk excluding the premiums paid during the first year
and any extra premium paid plus 30% of the premiums paid after the date of commencement
of risk.

Corporation’s policy on surrenders:

In practice, the company will pay a Special Surrender Value – which is either equal to or more
than the Guaranteed Surrender Value. The benefit payable on surrender reflects the
discounted value of the claim amount that would be payable on death or at maturity. This
value will depend on the duration for which premiums have been paid and the policy at the
date of surrender. In some circumstances, in case of early termination of the policy, the
surrender value payable may be less than the total premium paid.

The Corporation reviews the surrender value payable under its plans from time to time
depending on the economic environment, experience and other factors.

Note : The above is the product summary giving the key features of the plan. This is for
illustrative purpose only. This does not represent a contract and for details please refer to
your policy document.
Benefit Illustration:
Statutory warning:
“Some benefits are guaranteed and some benefits are variable with returns based on the
future performance of your insurer carrying on life insurance business. If your policy offers
guaranteed returns then these will be clearly marked “guaranteed” in the illustration table on
this page. If your policy offers variable returns then the illustrations on this page will show two
different rates of assumed future investment returns. These assumed rates of return are not
guaranteed and they are not the upper or lower limits of what you might get back as the value
of your policy is dependent on a number of factors including future investment performance.”

Illustration 1:
Age at entry: 0 years
Premium Paying Term: 1 Year Single Premium: Rs.73,980/-
Policy Term: 26 years
Sum Assured: Rs.1,00,000/-

Year Total Benefit on Death during the year (Rs.)

Premium Guaranteed Variable Total
paid till
end of Scenario 1 Scenario 2 Scenario 1 Scenario 2
year
1 73980 73980 0 0 73980 73980
2 73980 73980 0 0 73980 73980
3 73980 73980 0 0 73980 73980
4 73980 73980 0 0 73980 73980
5 73980 73980 0 0 73980 73980
6 73980 73980 0 0 73980 73980
7 73980 145000 0 12000 145000 157000
8 73980 152500 0 16000 152500 168500
9 73980 160000 0 21000 160000 181000
10 73980 167500 0 26000 167500 193500
15 73980 205000 0 67000 205000 272000
20 73980 242500 0 128000 242500 370500
26 73980 287500 0 277000 287500 564500
End of year Benefit on Survival / Maturity at the end of Year
Guaranteed Variable Total
Scenario 1 Scenario 2 Scenario 1 Scenario 2
18 20000 0 0 20000 20000
20 20000 0 0 20000 20000
22 30000 0 0 30000 30000
24 30000 0 0 30000 30000
26 195000 0 277000 195000 472000
Illustration 2:
Age at entry: 0 years
Premium Paying Term: 18 years Annual Premium: Rs.7,281/-
Policy Term: 26 years
Sum Assured: Rs.1,00,000/-

Year Total Benefit on Death during the year (Rs.)

Premium Guaranteed Variable Total
paid till
end of Scenario 1 Scenario 2 Scenario 1 Scenario 2
year
1 7281 7281 0 0 7281 7281
2 14562 14562 0 0 14562 14562
3 21843 21843 0 0 21843 21843
4 29124 29124 0 0 29124 29124
5 36405 36405 0 0 36405 36405
6 43686 43686 0 0 43686 43686
7 50967 145000 0 3000 145000 148000
8 58248 152500 0 5000 152500 157500
9 65529 160000 0 8000 160000 168000
10 72810 167500 0 11000 167500 178500
15 109215 205000 0 43000 205000 248000
20 131058 227500 0 71000 227500 298500
26 131058 242500 0 91000 242500 333500
End of year Benefit on Survival / Maturity at the end of Year
Guaranteed Variable Total
Scenario 1 Scenario 2 Scenario 1 Scenario 2
18 20000 0 0 20000 20000
20 20000 0 0 20000 20000
22 30000 0 0 30000 30000
24 30000 0 0 30000 30000
26 195000 0 176000 195000 371000

i) This illustration is applicable to a non-smoker male/female standard (from medical, life

style and occupation point of view) life.

ii) The non-guaranteed benefits (1) and (2) in above illustration are calculated so that
they are consistent with the Projected Investment Rate of Return assumption of 6%
p.a.(Scenario 1) and 10% p.a. (Scenario 2) respectively. In other words, in preparing
this benefit illustration, it is assumed that the Projected Investment Rate of Return that
LICI will be able to earn throughout the term of the policy will be 6% p.a. or 10% p.a.,
as the case may be. The Projected Investment Rate of Return is not guaranteed.

iii) The main objective of the illustration is that the client is able to appreciate the
features of the product and the flow of benefits in different circumstances with some
level of quantification.