LIC New Jeevan Nidhi Plan 818

LIC New Jeevan Nidhi Plan 818 was made to help people save money for retirement while getting life cover during the policy term. The plan gave fixed additions during the first five years and could earn LIC bonuses from the sixth year.

LIC withdrew this plan on 16 January 2020, so it cannot be purchased now. However, many old policies are still active, paid-up, lapsed or close to their end date. The LIC New Jeevan Nidhi Plan 818 Calculator helps estimate the benefits of these existing policies.

The calculator shows an estimated maturity amount based on the policy details entered. LIC calls this the vesting benefit in its policy document, but maturity amount is the simpler term used in this guide.

What Is the LIC New Jeevan Nidhi Plan 818 Calculator?

The LIC New Jeevan Nidhi Plan 818 Calculator is an online tool for withdrawn New Jeevan Nidhi Plan 818 policy. It estimates the total premiums paid, fixed additions, LIC bonus and final policy amount. It can also show the possible lump-sum amount, money available for buying a pension plan, death benefit, paid-up value and surrender value.

The full amount is not normally paid in cash. A permitted part may be taken as a lump sum, while the remaining amount is generally used to buy an LIC pension plan that provides regular income.

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Key Highlights of the Plan

The table below gives a quick view of Plan 818. These details apply to policies issued before the plan was withdrawn.

What Was LIC New Jeevan Nidhi Plan 818?

Plan 818 is a retirement plan in which the policy continued for a fixed number of years before the pension benefit became available. LIC officially called this period the deferment period. In simple words, it was the time between the policy start date and end date.

During this period, the policyholder paid regular premiums or one single premium. Life cover continued according to the policy rules, and additions could build over time.

At the end of the policy term, the available amount could include the Basic Sum Assured, Guaranteed Additions, LIC bonuses already added and Final Additional Bonus, if applicable.

A portion of this money may be taken as a lump sum. The remaining amount was normally used to buy an immediate pension plan from LIC. Another option was to use the full amount to buy an eligible LIC pension plan in which pension started later. No lump sum was available from the original policy when this second option was selected.

Benefits of LIC New Jeevan Nidhi Plan 818

Plan 818 helped build retirement money while providing life cover during the policy term. It gave fixed additions for the first five eligible years and could receive LIC bonuses after that. The choice between regular premiums and one single premium gave flexibility when the policy was purchased.

The retirement amount could be used to create regular pension income. If the policyholder died before the policy ended, the nominee received the death benefit according to the policy year and the benefits already earned. These benefits depend on the current status and conditions of the issued policy.

How the Calculator Works

The calculator uses details such as policy type, age when the policy started, age when benefits begin, Basic Sum Assured, premiums paid, completed policy years and bonus information.

For an old policy, the actual premium and bonus shown in the policy schedule or LIC statement should be entered whenever available. If the bonus is not known, an assumed rate may be used only to understand a possible result. It is not a bonus promised by LIC.

Formula Used in the Calculator

Guaranteed Addition Formula

For an eligible active Plan 818 policy, LIC added ₹50 per ₹1,000 of Basic Sum Assured for each of the first five policy years.

Guaranteed Addition for One Year
= Basic Sum Assured ÷ 1,000 × ₹50

Total Guaranteed Additions
= Guaranteed Addition for One Year × Eligible Years

The number of eligible years cannot be more than five. For a Regular Premium policy, the required premiums must have been paid. For a Single Premium policy, the addition was added after completing each of the first five policy years.

LIC Bonus Formula

The policy could earn LIC’s Simple Reversionary Bonus from the sixth year. The bonus rate could change every year because LIC declared it based on its experience.

When an assumed rate is used, the calculator applies this formula:

Estimated Bonus
= Basic Sum Assured ÷ 1,000
× Assumed Bonus Rate
× Eligible Bonus Years

The total bonus already shown in the LIC record should be entered when available. This gives a more reliable result than using one assumed rate for every year.

Maturity Amount Formula

Estimated Maturity Amount
= Basic Sum Assured
+ Guaranteed Additions
+ Bonus Already Added or Estimated Bonus
+ Final Additional Bonus, if applicable

Final Additional Bonus is not guaranteed. When no amount is available from an LIC record or declaration, this field should be kept at zero.

How to Use the Calculator

1. Select Regular Premium or Single Premium.
2. Enter the age when the policy started and the age when benefits begin, as shown in the policy schedule.
3. Enter the Basic Sum Assured and completed policy years.
4. Enter the actual basic premium and number of premiums paid, if required.
5. Add the bonus shown in the LIC statement. Use an assumed rate only for an example.
6. Enter Final Additional Bonus only when a suitable amount is known.
7. Select the required calculation and press Calculate.

Do not include tax, rider premium, extra premium, late fee or interest in the basic premium field unless the calculator asks for them separately.

Real Calculation Example

Consider an active Regular Premium policy with the following details:

First, calculate the Guaranteed Additions:

Addition for One Year
= ₹5,00,000 ÷ 1,000 × ₹50
= ₹25,000

Additions for Five Years
= ₹25,000 × 5
= ₹1,25,000

Next, calculate the estimated bonus:

Estimated Bonus
= ₹5,00,000 ÷ 1,000 × ₹42 × 20
= ₹4,20,000

The estimated maturity amount is:

Basic Sum Assured:          ₹5,00,000
Guaranteed Additions:       ₹1,25,000
Estimated Bonus:            ₹4,20,000
Final Additional Bonus:       ₹30,000
Estimated Maturity Amount: ₹10,75,000

The estimated maturity amount is ₹10,75,000. The bonus rate of ₹42 and Final Additional Bonus of ₹30,000 are used only to explain the calculation. Actual amounts may be different.

Understanding the Calculator Result

The total amount shown should not be treated as money that will be fully paid in cash. The result should show the possible lump sum and the amount available for buying a pension plan separately.

Possible Lump-Sum Amount
= Maturity Amount × Permitted Lump-Sum Percentage

Amount for Buying a Pension Plan
= Maturity Amount − Lump-Sum Amount

The permitted lump-sum percentage depends on the policy conditions and tax rules in force on the policy end date. The final pension depends on the money used to buy the pension plan, age, selected pension option, payment mode and rate available at that time. Therefore, the total retirement amount is not the same as a guaranteed monthly pension.

If the total amount is too small to buy the minimum pension allowed under the applicable rules, it may be paid fully as a lump sum.

Death Benefit Before the Policy Ends

If death occurred during the first five policy years while the policy was active, the benefit broadly included the Basic Sum Assured and Guaranteed Additions earned up to that time.

Death Benefit
= Basic Sum Assured + Guaranteed Additions Earned

If death occurred after the first five years but before the policy ended, LIC bonuses already added and Final Additional Bonus, if applicable, could also be included.

When all due premiums had been paid, the death benefit could not be lower than 105% of total premiums paid. Tax, extra premium and rider premium were not included in this premium total. The nominee could receive the eligible amount as a lump sum, use it to buy a pension plan, or choose a mix of both according to the policy conditions.

Paid-Up Value

A Regular Premium policy may become paid-up when the minimum required premiums have been paid but later premiums are stopped. The policy continues with lower benefits, and no further premiums are required.

Paid-Up Sum Assured
= Basic Sum Assured
× Premiums Paid
÷ Total Premiums Originally Payable

Guaranteed Additions and bonuses already earned remain attached to the policy. However, no future additions or bonuses are earned after the policy becomes paid-up. Final Additional Bonus is not payable under a paid-up policy.

Surrender Value

Surrender means closing the policy early. A Single Premium policy could be surrendered at any time during the policy term.

Tax and extra premium are excluded from this calculation.

A Regular Premium policy could qualify for surrender after two consecutive years of premiums when the remaining policy period was below 10 years. Three consecutive years of premiums were required when this period was 10 years or more.

The surrender value depends on the premiums paid, policy year, policy term, additions already earned, bonus and surrender factors. LIC may pay a Special Surrender Value when it is higher than the Guaranteed Surrender Value.

The surrender amount also follows pension rules. A permitted part could be taken as a lump sum, while the remaining money was normally used to buy an LIC pension plan. The full amount could instead be used to buy an eligible LIC pension plan in which pension started later. If the amount was too small to buy the minimum pension, it could be paid fully as a lump sum.

Tax Benefits under LIC New Jeevan Nidhi Plan 818

Premiums paid under an eligible pension policy may qualify for a deduction under Section 80CCC when the old tax regime is used. This is included in the combined limit of ₹1.5 lakh under Sections 80C, 80CCC and 80CCD(1), subject to the tax rules. This deduction is generally not available under the new tax regime.

Tax rules may be different for the lump-sum amount and regular pension. The permitted lump sum may receive a tax exemption, while regular pension income is generally taxable. Tax rules can change, so the rules applying in the year of payment should be checked.

Why Choose LIC New Jeevan Nidhi Plan 818?

Plan 818 cannot be chosen or purchased now because it has been withdrawn. For an existing policyholder, it may still provide value through the retirement money already built, additions already earned, LIC bonus and life cover available under the policy terms.

Before stopping premiums or surrendering the policy, the benefits available under an active, paid-up or surrendered policy should be compared. The calculator can help with this comparison, but the final decision should also consider retirement needs and LIC’s official values.

Important Points to Remember

Plan 818 is closed to new buyers. No loan or assignment was allowed under this plan. Nomination could be registered or changed through the LIC office handling the policy.

A lapsed Regular Premium policy could be considered for revival within two years from the first unpaid premium and before the policy ended. Revival required unpaid premiums with interest and LIC’s approval. Any extra rider benefit depended on the rider document attached to the policy.

The calculator cannot promise future bonus, Final Additional Bonus, pension rate or Special Surrender Value. It also cannot confirm whether a policy is active, paid-up, lapsed, surrendered or already matured. The policy schedule, premium receipts, bonus record and LIC’s official benefit statement should be checked for the final amount.

Frequently Asked Questions

Is LIC New Jeevan Nidhi Plan 818 still available?

No. LIC withdrew Plan 818 from new business on 16 January 2020. The calculator is meant for existing policies.

What is the maturity benefit under Plan 818?

The maturity benefit may include the Basic Sum Assured, Guaranteed Additions, LIC bonus already added and Final Additional Bonus, if applicable. LIC officially calls this the vesting benefit.

Is the LIC bonus guaranteed?

No. LIC declared the bonus based on its experience. Once declared and added to an eligible policy, it became part of the policy benefit.

Can the full maturity amount be taken in cash?

Not normally. A permitted part could be taken as a lump sum, while the remaining amount was generally used to buy a pension plan. Full cash payment could apply when the amount was too small to buy the minimum pension.

Can Plan 818 be surrendered?

Yes, after meeting the required conditions. The amount depends on the policy type, policy year, premiums paid, additions, bonus and surrender factors. Pension-related rules also apply to the use of surrender money.

Conclusion

The LIC New Jeevan Nidhi Plan 818 Calculator helps estimate the maturity amount of an existing policy. It combines the Basic Sum Assured, Guaranteed Additions and bonus details to explain how much retirement money may be available. It can also estimate the death benefit, paid-up value and surrender value.

The full maturity or surrender amount is not normally available as cash. A permitted part may be taken as a lump sum, while the remaining amount is generally used to receive regular pension income. For a more reliable estimate, the actual premium, completed policy years and bonus shown in the policy or LIC statement should be used.