5 changes in LIC insurance plans from 2020.
Note:
This article is a must-read if you are a Life Insurance Planner or LIC. Some of the terms of a life insurance policy will change from next year. It's good to know many things, including whether or not this change will affect your life insurance plan.
Many life insurance products will witness several changes next year, from the opportunity for a partial withdrawal to a period of increasing revival. The new regulations will come into effect from February 1, 2020.
The Insurance Regulatory Development Authority (IRDAI) has relaxed the rules for pension rules, ULIPS (Unit Linked Insurance Plan), and traditional life insurance plans to benefit consumers.
Notice what changes will happen.
Changes in the lapse rules
Changes in the lapse rules
If the unit-linked products are laps, the revival period is increased to three years. Non-Linked - The regeneration period for lapsed products is 5 years. Before this, the revival period was limited to just two years. So what is the Renaissance Period? The policy laps in such a period from the day the premium is not paid. That way, there is a chance to revive the lapsed policy. The time limit has been expanded before.
One-third is tax-free
One-third is tax-free
Withdrawal of the pension plan increases with effect from 1st February. A maximum of 60% is allowed in the closing period instead of the current one-third of the corpus with a draw. But one-third of this pension plan is tax-free. But the maximum limit is 60% tax-free. "With this new amendment, NPS has made pension plans in line with the products, which will benefit both the consumer and the insurance industry," said Sanjay Tiwari, director of Exide Life Insurance.
Instead of the policy of getting partial insurance money back
nstead of the policy of getting partial insurance money back
IRDAI has also changed the rules for withdrawing partial insurance money prematurely. Once the lock-in period is over 5 years, customers are entitled to a partial withdrawal of up to 25%. But there must be important reasons for that. Partial revocation is allowed to buy or build higher education, child marriage, or a severe health problem or housing property. Previously regulators were not allowed to draw with. But now the rulemaking has been approved by IRDAI.
Seven times less than 10 times
Seven times less than 10 times
For those under the age of 45, the minimum life expectancy at ULIP is reduced to seven instead of 10 currently available. For those under the age of 45, the current 10 times will be reduced to seven times. "Sum Assured" means the sum assured, which is the sum assured upon the death of the policyholder.
Mandatory Guarantee of Pension ULIP Segment Optional
Necessary Guarantee of Pension ULIP Segment Optional
The mandatory guarantee of the Pension ULIP segment will be optional from February 1. This was previously mandated by the IRDAI. Pension ULIP plans are compulsory for insurers. Policyholders now have more comfortable options. They have a chance to decide on whether or not they need a guarantee.