Confused! Jeeva Saral Policy Maturing - What Benefits will I Get?

Ans: And this policy was for what period. Best is you can put this query to your insurance agent or get it from your policy servicing branch

Ans: Surrendering an insurance policy is a major decision. You have consistently paid Rs 4083/- per month since 2012. This dedication shows your commitment to securing your future. Now, let's delve into the specifics of surrendering your policy and its implications.

Surrender Value and Its Components
The surrender value is the amount you get when you decide to discontinue your policy before its maturity. This amount includes two main components:

Guaranteed Surrender Value: This is a percentage of the premiums you have paid, minus the first year's premium and any bonuses you might have received.

Special Surrender Value: This is usually higher than the guaranteed surrender value. It takes into account factors like the duration of the policy and the total premiums paid.

Since you have been paying premiums for over a decade, you are likely to receive a special surrender value. This value reflects the time and money invested in the policy.

Evaluating Bonuses
Insurance policies often come with bonuses, which are additional amounts added to the sum assured. These bonuses can significantly impact the surrender value. However, understanding the exact bonus details can be challenging without specific policy documentation. Generally, bonuses accumulate annually and are declared by the insurance company based on their profits.

In your case, given the policy's tenure, there should be a notable bonus component. But, for precise information, it's essential to contact the insurance company directly or refer to your policy documents.

Analyzing Financial Goals
Surrendering a policy is not just about the immediate financial gain. It's crucial to align this decision with your long-term financial goals. Reflect on the reasons for surrendering the policy:

Immediate Financial Needs: If you have urgent financial requirements, surrendering the policy might provide quick funds.

Better Investment Opportunities: You might want to explore other investment avenues that offer higher returns.

Changing Financial Priorities: Your financial goals and priorities might have evolved over time.

Exploring Alternative Investments
Upon surrendering your policy, you might consider reinvesting the proceeds. Here are some options to consider:

Mutual Funds
Mutual funds offer a diverse range of investment opportunities. They are managed by professional fund managers who make investment decisions on your behalf. Here’s why mutual funds can be a good option:

Diversification: Mutual funds invest in a variety of assets, reducing risk.

Professional Management: Experienced fund managers handle your investments.

Liquidity: You can easily buy and sell mutual fund units, providing flexibility.

Potential for Higher Returns: Historically, mutual funds have offered higher returns compared to traditional savings instruments.

Systematic Investment Plans (SIPs)
SIPs are a disciplined way to invest in mutual funds. They allow you to invest a fixed amount regularly, ensuring you benefit from market fluctuations. This method can help you build a substantial corpus over time.

Debt Instruments
If you prefer lower risk, consider debt instruments like fixed deposits or government bonds. These options provide stability and predictable returns.

Equity Investments
For those comfortable with higher risk, equity investments can offer significant growth potential. Investing in stocks directly can be rewarding but requires careful analysis and monitoring.

Assessing Risks and Benefits
Every investment comes with its own set of risks and benefits. It’s important to evaluate these before making a decision:

Risk Tolerance: Understand your ability to withstand market fluctuations.

Time Horizon: Consider the duration you can keep your money invested.

Financial Goals: Align your investments with your long-term objectives.

Tax Implications: Different investments have varied tax treatments. Understand the tax benefits and liabilities associated with each option.

Consulting a Certified Financial Planner
To make an informed decision, it’s wise to consult a Certified Financial Planner (CFP). A CFP can provide personalized advice based on your financial situation and goals. They can help you:

Analyze Your Current Financial Position: Assess your income, expenses, and savings.

Set Realistic Goals: Define achievable financial objectives.

Create a Customized Investment Plan: Develop a strategy tailored to your needs.

Monitor and Adjust: Regularly review and adjust your plan to stay on track.


Your dedication to paying premiums for over a decade is commendable. This long-term commitment reflects your focus on financial security. When considering policy surrender, it's important to maintain this long-term perspective. Think about how your decisions today will impact your financial future.


We understand that navigating financial decisions can be challenging. It’s normal to feel uncertain about the best course of action. By gathering information and seeking professional advice, you’re taking the right steps toward making an informed decision.

Final Insights
Surrendering your insurance policy is a significant decision with various implications. It's essential to consider the surrender value, bonuses, and your long-term financial goals. Exploring alternative investments can provide opportunities for better returns and financial growth. Consulting a Certified Financial Planner can offer valuable guidance tailored to your needs. Remember to maintain a long-term perspective and make decisions that align with your financial objectives.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in

Ans: Policy Details Overview
Policy Name: Jeevan Asha - 2
Start Date: 28-09-2003
Half-Yearly Premium: Rs 11,992
Policy Term: 25 years
Plan Number: 131-25
You are paying Rs 11,992 as a half-yearly premium, which amounts to Rs 23,984 annually. This policy has a term of 25 years.

Total Premium Paid
Total Premiums Paid Over 25 Years:
Annual Premium: Rs 23,984
Total Years: 25
Total Premium Paid: Rs 23,984 * 25 = Rs 5,99,600
Maturity Amount Estimation
The maturity amount for a Jeevan Asha - 2 policy can depend on various factors, including the sum assured, bonuses, and final additional bonuses (FAB). Since the specific sum assured and bonuses are not provided, we will give a general idea.

Sum Assured:

The sum assured is the guaranteed amount paid on maturity. Check your policy document for the exact sum assured amount.
Bonuses:

LIC policies often include reversionary bonuses declared annually. The bonus rate varies yearly. Historically, it has been around Rs 40 to Rs 50 per Rs 1,000 of the sum assured.
Final Additional Bonus (FAB):

An additional bonus may be declared at the end of the policy term. This depends on LIC's performance and policy duration.
Example Calculation
For an illustrative example, let's assume:

Sum Assured: Rs 3,00,000 (You need to check your policy for the exact sum assured)
Annual Bonus: Rs 45 per Rs 1,000 sum assured
FAB: Rs 25 per Rs 1,000 sum assured (if applicable)
Annual Bonus Calculation:

Sum Assured: Rs 3,00,000
Annual Bonus: Rs 45 per Rs 1,000 = Rs 13,500 per year
Total Bonuses Over 25 Years: Rs 13,500 * 25 = Rs 3,37,500
Final Additional Bonus (FAB):

Sum Assured: Rs 3,00,000
FAB: Rs 25 per Rs 1,000 = Rs 7,500
Total Maturity Amount:

Sum Assured: Rs 3,00,000

Total Bonuses: Rs 3,37,500

FAB: Rs 7,500

Total Maturity Amount: Rs 3,00,000 + Rs 3,37,500 + Rs 7,500 = Rs 6,45,000

Final Insights
The exact maturity amount can vary based on the sum assured and actual bonuses declared by LIC. It is advisable to consult your policy document or contact LIC for precise details.

By estimating the bonuses and sum assured, you can get an idea of the maturity amount.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: You hold a participating insurance policy with dual benefits: life cover and maturity payout.

The policy term is until age 100, ensuring lifelong coverage.

Your premium-paying term is 20 years, ending in 2025.

You will receive a maturity payout in 2025 if you choose.

Alternatively, you may keep the maturity amount invested in the policy.

If kept invested, benefits accumulate until policy maturity or claim.

Key Aspects to Evaluate
Life Coverage Beyond 2025
Post-2025, the policy continues to provide life cover until age 100.

The sum assured ensures financial security for your dependents.

Maturity Amount Usage
The payout in 2025 can address your financial goals.

Retaining the maturity amount earns additional bonuses over time.

Cost-Effectiveness of Continuing
Premium payments cease after 2025, reducing financial outflow.

Assess the policy's bonus and return rates for future benefits.

Assessing Financial Goals
Immediate Needs
Review current financial priorities like retirement planning or liabilities.

The maturity amount can supplement other investments.

Long-Term Growth Opportunities
Retaining the policy boosts long-term returns due to ongoing bonuses.

Consider the tax efficiency of keeping the maturity amount invested.

Alternative Investment Avenues
Evaluate reinvestment in mutual funds for potentially higher returns.

Active funds with a Certified Financial Planner's guidance can outperform.

Regular funds through an advisor ensure tailored advice and discipline.

Insurance Versus Investment
Dual-purpose policies often underperform as pure investments.

Standalone insurance offers better coverage at a lower premium.

Mutual funds provide transparency, liquidity, and targeted growth.

Tax Implications
The maturity payout is tax-free if premiums are below 10% of the sum assured.

Keeping the policy active beyond 2025 avoids tax on continued bonuses.

Evaluate the tax efficiency against returns from other instruments.

Recommendations
For Policyholders Like You
Continue with the policy until 2025 for the full maturity benefit.

Post-2025, decide based on returns and financial needs.

Consult a Certified Financial Planner for optimizing maturity usage.

If Considering Policy Surrender
Reinvest surrendered funds in diversified mutual funds.

Seek active management for consistent, tax-efficient growth.

Final Insights
Your policy secures lifelong coverage and a guaranteed payout in 2025.

Retaining the policy beyond 2025 can maximize accumulated benefits.

Reinvesting in well-managed mutual funds may deliver superior growth.

Ensure alignment with your long-term financial goals and family security.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment