Is LIC policy a good investment for future?
Is LIC policy a good investment for future?
LIC has been in the insurance industry from the past 1956. It has more than 250+ million policyholders.

LIC Policies have been handling the insurance needs of people for many years. Its longstanding commitment to a customer-centric approach has helped it become the largest insurance provider in India. LIC policies have been stable in their returns over the years. This article covers details on how LIC policy is good for future investment.


Know more about LIC

LIC has been in the insurance industry from the past 1956. It has more than 250+ million policyholders. The company currently occupies more than 60% market share in the insurance sector.

LIC's distribution network includes over 1.5 lakh LIC agents, partnerships, and online sales channels. Its product offerings include endowment-based policies, ULIPs, term insurance, money-back, and pension plans.


Why should one buy LIC policies?

LIC policies have long been a safe insurance scheme backed by the Indian Government. The company has consistently reported a high claim settlement ratio over the years.

The claim settlement ratio defines the total number of claims settled by the LIC as the number of allegations collected by the beneficiaries. In FY 2021-22, it reported a CSR of 98.62%. This number indicates the insurer's reliability in settling death and other claims. With LIC, you can be sure that your family will get the benefits they are entitled to after your death.


Is LIC policy a promising investment option?

If you are planning to save prudently and get high ROI, LIC policies may not meet your requirements. This is because the internal rate of return offered in traditional endowment policies is only 4% to 5%, which does not include inflation.


You can get better returns through traditional investment avenues like stocks, bonds, and mutual funds. You should only consider them if you have a high to moderate risk appetite.

However, you can invest in insurance for direct policy benefits or invest in debt funds for lower-market risks but decent returns.

Life insurance in any form ensures that your dependents and their future financial needs are taken care of in case of your unfortunate demise. You can add LIC policies to your financial portfolio as effective risk management.


List of LIC Plans:

·      LIC's Bima Jyoti

·      LIC's Bima Ratna

·      LIC's Dhan Sanchay

·      LIC's Dhan Varsha

·      LIC's New Endowment Plan

·      LIC's New Jeevan Anand

·      LIC's Single Premium Endowment Plan

·      LIC's Jeevan Lakshya

·      LIC's Jeevan Labh

·      LIC's Aadhaar Stambh

·      LIC's Aadhaar Shila

·      LICs Jeevan Umang

·      LIC's Dhan Rekha

·      LIC's New Bima Bachat

And many more...

Benefits of buying a LIC policy

LIC policies provide many multiple benefits as mentioned below:

Owned by the Government of India - LIC comes with the sovereign guarantee of the Government of India, making its offerings a safe and reliable investment.

Many Tax Benefits - Policyholders can enjoy tax exemptions on the premium amount under Section 80C of the Income Tax Act, 1961. All profit income is subject to tax exemptions under Section 10(10D). However, these tax benefits are applicable to insurance plans purchased from any insurance provider and savings plans like PPF and FD.


Additional returns - LIC collects premiums collected from policyholders, invests mostly in government securities, and earns profits. A percentage of the additional earnings is given to its customers in the form of bonuses.

Financial Security - The only reason people should invest in life insurance plans from LIC is to protect their dependents financially and secure their future in case any misfortune happens to the policyholder.


Final words!

Insurance and investment should not be mixed. Both should be given equal importance while financial planning. Although LIC policies offer enough benefits to secure your family finances after your death, they do not provide enough returns for wealth creation. Therefore, you should look to invest in various financial instruments for personal purposes. So, if you are planning to buy LIC Policy then contact our Best LIC Agent in Bangalore only through our official website. We will explain to you the details about the policies which are suitable for your needs and deliver them to your doorsteps.