LIC’s Jeevan Utsav Investment Scheme in India

Let us see about LIC’s Jeevan Utsav Investment Scheme in India.

LIC’s Jeevan Utsav (Plan No. 871, latest version) is a whole life, guaranteed income plan from LIC that gives lifelong cashflow after a limited premium-paying term, along with life cover up to age 100 and tax benefits under Sections 80C and 10(10D) if conditions are met. It is meant for people who want pension‑like guaranteed income from LIC rather than market‑linked returns, and who are comfortable locking in money long term for safety and predictability.​

Where Should I Apply for Jeevan Utsav?

You can buy Jeevan Utsav almost exactly like Jeevan Umang – through standard LIC channels with simple KYC and, if needed, medical checks.​

LIC Branches

• Visit any LIC branch to discuss Sum Assured, premium, and income option.
• Submit proposal form, KYC, and first premium by cash, cheque, or accepted digital modes; policy bond is issued after acceptance.​

LIC Agents

• Agents help you choose:
  • Basic Sum Assured (BSA)
  • Premium Paying Term (PPT – e.g., 5 to 16 years)
  • Income option (Regular/Flexi income)
• They generate official benefit illustrations so you see premium vs guaranteed income clearly before buying.​

Online via LIC Portal (where enabled)

• For eligible customers, you can register on LIC’s portal, complete eKYC, fill the proposal details (BSA, PPT, income option) and pay online, then receive the policy document digitally plus by post.​

Common Service Centres (CSCs) / Rural Points

• In many areas, LIC ties up with service centres and local outlets that help with offline forms, KYC, and premium collection for easier access.​

Documents Required

• Proposal form (with BSA, PPT, income option, nominees).
• PAN, Aadhaar, 1–2 photos, address proof.
• Income proof for higher Sum Assured.
• Medical tests if age or Sum Assured crosses non‑medical limits.

Guardian can buy Jeevan Utsav on the life of a minor, with the child becoming owner at majority; the policy can later be assigned or used as collateral if the lender accepts it.​

Eligibility Criteria

Jeevan Utsav is structured to suit families planning retirement, child income, or second‑generation pension with strong guarantees.​

Who Can Buy (Age‑wise)

• Kids (Minors)
  • Parents/legal guardians can take the plan for a child; premium is paid by the parent, and guaranteed income later supports education or lifetime cashflow.
• Youth/Adults (18+)
  • Salaried, self‑employed and homemakers can buy if KYC and income underwriting fit the chosen BSA and PPT.
  • Ideal for those who want to “lock in” a future pension early.
• Middle‑Age / Senior (up to max entry age)
  • Entry allowed up to a maximum age (usually around late 50s/early 60s depending on PPT), so that income period and cover up to 100 remain feasible.

Sum Assured & Premium Paying Term (PPT)

• Basic Sum Assured (BSA):
  • Minimum BSA is fixed by LIC (commonly in a few lakh rupees).
  • No strict upper cap, but higher BSA needs income/medical proof.
• PPT Options (key difference vs Umang):
  • Shorter limited PPTs like 5, 7, 10, 12, or 16 years (exact options depend on LIC’s version).​
  • You pay only during PPT; income then starts from a specified policy year and continues for life.

Tax Angle & Family Planning

• Premiums for all family members together still share the Section 80C cap of ₹1.5 lakh per year, so multiple Jeevan Utsav/Umang policies are allowed but 80C deduction remains limited.​
• Jeevan Utsav works very well if one spouse focuses on building a guaranteed lifelong pension while the other focuses on growth assets (equity funds, etc.).

Who Is Not Eligible / Restrictions

To keep focus on individual whole‑life guaranteed income:​

• Policies are for single life only; joint life versions are not standard.
• HUFs, firms, and companies generally cannot buy; it’s designed for individuals.
• NRIs/PIO/OCI can be restricted or subject to additional conditions depending on LIC’s current rules; existing resident policies can usually continue if you move abroad.
• One life can hold multiple policies, but each policy has one proposer and one life assured (no “multiple proposers” on one policy).

Key practical point: track total family premium vs family cash flow and 80C limits so you don’t over‑lock money just for the sake of tax saving.​

Examples – How Much You Pay vs How Much You Get

These are simple, easy illustrations, not official numbers. Exact premiums depend on LIC tables, age, PPT, GST, etc.

1st Example: YOU (Age 30 Adult, BSA ₹10 Lakh, PPT 10 Years)

You want a guaranteed pension‑like income from around age 40 onward.

Assumptions (for understanding):

• Age: 30
• BSA: ₹10,00,000
• PPT: 10 years
• Approx. annual premium: say ₹1,00,000 (illustrative; real figure may differ)

How much you pay

• ₹1,00,000 per year × 10 years = ₹10,00,000 total

When income starts

• With PPT 10 years, the regular income (10% of BSA) typically starts around the 11th–12th policy year, i.e., around age 41–42.​

How much you get

• Yearly guaranteed income = 10% of ₹10,00,000 = ₹1,00,000 per year.
• This continues every year till age 100 (as long as you live).

So if income starts at around age 41 and you live to 100:

• Number of income years ≈ 59–60 years.
• Total income ≈ ₹1,00,000 × ~60 = ₹60,00,000 in today’s rupee terms.
• On death (whenever it occurs), the nominee also receives the death benefit as per Jeevan Utsav rules (often at least BSA or a defined guaranteed amount).

Plain language:

• You pay about ₹10 lakh in 10 years.
• You then get around ₹1 lakh every year for life, potentially ~₹60 lakh if you live long, plus insurance cover in the background.

2nd Example: CHILD PLAN (Newborn / Age 1, BSA ₹10 Lakh, PPT 10 Years)

You want to set up a guaranteed lifelong income for your child, starting when they are young adults.

Assumptions:

• Child’s age at entry: 1 year
• BSA: ₹10,00,000
• PPT: 10 years
• Approx. annual premium: say around ₹75,000 (illustrative)

How much you pay

• ₹75,000 per year × 10 years = ₹7,50,000 total

When income starts

• Income might start around the 11th–12th year; child age ≈ 12–13.
• In practice, many parents would instead choose a slightly later income start schedule if available, but conceptually, income can begin early and continue for life.

How much the child gets

• Yearly guaranteed income = 10% of ₹10,00,000 = ₹1,00,000 per year.
• Paid every year till age 100, as long as the child is alive.

If income flows from age 13 to 100:

• Number of income years ≈ 87.
• Total income ≈ ₹1,00,000 × 87 = ₹87,00,000 over lifetime, on a total parent investment of about ₹7.5 lakh.

This is why many agents position Jeevan Utsav as a “lifetime pocket money / pension” for children: lower one‑time commitment by parents creates guaranteed yearly income for the child forever, plus life cover.

Key Features

Jeevan Utsav is built as a guaranteed lifetime income + whole‑life cover plan, with shorter premiums and more explicit guarantees than bonus‑driven Umang.​

1. Risk Cover (Life Insurance)

• Life cover normally equals BSA or “Sum Assured on Death” as per plan rules and continues up to age 100.
• On death, nominee receives this death benefit, and the regular income stops; if death occurs before regular income starts, the nominee receives the guaranteed death cover.​

2. Premium Paying Term (PPT)

• Limited period (e.g., 5–16 years) instead of 20–30 years.
• Idea: Pay fast in your earning years, enjoy guaranteed income for rest of life.

3. Guaranteed Income – 10% of BSA Per Year

• After a specified policy year (linked to PPT), you start getting 10% of BSA every year as Regular Income Benefit.​
• For example, if BSA = ₹10,00,000, yearly guaranteed income = ₹1,00,000.

4. Lifetime Income up to Age 100

• Once started, this guaranteed income continues every year till age 100, as long as you are alive and the policy is active.​

5. Guaranteed Additions / Benefit Build‑Up

• During PPT or initial years, Jeevan Utsav adds guaranteed amounts to the policy value each year, increasing the effective benefit base, as specified by LIC’s schedule.
• This is different from bonus uncertainty; the additions are written into the contract.

6. Taxation

• Premiums eligible for deduction under Section 80C (subject to ₹1.5 lakh overall cap).
• Income and final benefits are usually tax‑free under Section 10(10D), provided premium does not exceed the permitted percentage (like 10%) of Sum Assured and other conditions hold.

7. Safety

• Not market‑linked; there is no NAV or equity risk.
• Returns are moderate but highly predictable compared to ULIPs or mutual funds.

Loans, Surrender & Common Mistakes

Loans

• After policy acquires a surrender value (usually a few years of full premium payment), you can take loans against the policy, typically up to a percentage of surrender value, at an interest rate decided by LIC.

Surrender / Paid‑Up

• Early surrender can reduce value significantly; Jeevan Utsav works best when held long term.
• If you stop premiums after a certain minimum, the policy may become “paid‑up” with reduced income and benefit; always check the impact before discontinuing.

Common Mistakes

• Choosing very high BSA and PPT without checking affordability, then lapsing the policy.
• Comparing it directly with equity mutual funds; Jeevan Utsav is a guaranteed income tool, not a growth‑maximising investment.
• Ignoring that 80C limit is shared with EPF, PPF, home loan principal, etc.

Used correctly, Jeevan Utsav is best seen as a private, guaranteed “lifetime pension” from LIC – pay for a short period, then enjoy predictable yearly income and whole‑life cover, accepting that returns are moderate but safety is high.