LIC TECH-TERM PLAN

LIC Tech Term is a term insurance policy proposed by Life Insurance Company (LIC). 

Finding the perfect term insurance based on your family’s needs is very important. The LIC Tech Term plan allows you to customize your policy with options such as claim payout, increasing cover and rolling limited pay. However, this product is slightly expensive compared to other plans in the market and does not give you an option to buy the critical illness rider along with it. Further, the insurer does not have a good track record with the purchase and claims service experience. 

Life Insurance Company holds a tremendous track record in both purchase and claims settlement. This indicates your family is less likely to face issues related to the claim settlement process. On the flipside however, the LIC Tech Term plan does not allow you to pay premiums based on monthly installments. It is comparatively more expensive than other products in the market. And, under this plan, you cannot choose some of the important customizations such as increasing cover and critical illness rider.

Here's a detailed review of LIC Tech Term plan.  

What are the benefits and features of the LIC Tech Term? 

• Life cover Benefit: This term insurance plan pays an assured sum of money to your family if your death happens during the term of the policy. There is no maturity benefit in this policy - meaning, you don’t get anything back in case you survive the term of theAfter you choose a suitable sum assured based on your family’s needs, the LIC Tech Term plan provides you with the increasing cover option to automatically grow your term cover by 10%. It allows you to increase your cover up to two times your base cover. policy. You can claim tax benefits under Sec. 80C of the Income Tax Act with this term insurance policy. 
• Entry age for the policy: This plan allows you to apply for the policy, when your age is at least 18 years and until you’re 65 years old. 
• Increasing Cover: After you choose a suitable sum assured based on your family’s needs, the LIC Tech Term plan provides you with the increasing cover option to automatically grow your term cover by 10%. It allows you to increase your cover up to two times your base cover.
• Cover Duration: The plan gives you the chance to choose a cover till the age of 80 years, which means you can enjoy the benefits of your term insurance post-retirement as well. 
• Limited Pay Option: The LIC Tech Term plan also offers the option to pay off your premiums early using the Limited Pay option. In fact, you can select the exact number of years for which you pay the premiums - using the Rolling Limited Pay Option. Regardless of how many years you pay off the premiums, you will retain the cover amount until the end of the term. This can be very helpful for people who expect an unstable income in the future or want to get the burden of premium payments off their chest quickly.
• Claim Payout Option: This product provides various claim payout options out of which you can select the best option which would suit your family. The options include- 
  • Lump-sum, where your family/ nominee will receive the claim amount in one, large installment.
  • Lump-Sum with monthly income, where your family will get the partial claim as a lump sum, and the other half of the claim will be given to your family in monthly installments.
  • Monthly income model - With this, your nominee will get the claim amount in monthly installments. This is a good option if you think your nominee won’t be able to manage a huge amount of money at once. 

Which Riders are available with the LIC Tech Term Plan?

The LIC Tech Term plan only provides you with the  Accidental Death Benefit Rider. If you purchase the accidental death benefit rider along with your term insurance plan, your family will receive an additional sum of money in case your death happens due to an accident. There’s usually an income-related limit on the amount of term insurance cover you can buy. So if you’re not eligible to buy the desirable term insurance cover as per your family’s needs, you can consider buying this rider.  

However, like other products, the LIC Tech Term does not provide you with the benefits of critical illness rider and waiver of premium rider. 

Why should you choose Life Insurance Company as your insurer? 

Here are some reasons why LIC might be a good choice for you.

• Speed of Claim Settlement: LIC holds a good track record in settling the claims. They have settled around 94.88% of their claims in less than 30 days. This indicates your family’s claim might be settled quickly. 
• Separate Claim Form For 3+ Years Policy: During the time of the claim settlement, your nominee or family will have to fill out a claim form to receive the claim settlement amount. Compared to most of the insurers, LIC provides a short and simpler claims form - and a separate claims form if the policy has been in force for more than three years. This means your nominee or family is less likely to face the hassle during the claim process, and the claim will likely be settled quicker too.  No other insurer in the market has this offering, and we strongly believe that they should take a leaf out of LIC’s book, and replicate this feature. 
  Note: The above facility is in line with the Section 45 of the Insurance Act, which states that once a life insurance policy completes 3 years, a claim cannot be rejected by the insurer for any reason whatsoever. In essence, this means that the insurer is forced to pay this out to your family, and hence there would be no need for them to waste any time in an investigation. Hence, the shorter form by LIC will cause little hassle at the time of claim settlement. 
• Claim Settlement Ratio: The claim settlement ratio of LIC is 96.69% and their claim amount settlement ratio is 93.45%.

Disadvantages of buying this policy from Life Insurance Company

• Claims Complaints: According to our research, we found that LIC has a higher number of complaints compared to other insurers. This could result in an uneven claim settlement process and your family could experience some hassle during the process. 
• Personal Relationship Manager: A lot of insurance companies provide a personal relationship manager to help your nominee at the time of claim. LIC, however, does not provide any personal relationship manager. 
• Online tracking of Claims: The insurer does not provide an option to track claims online. So, your family will have to contact the insurance company via the provided toll-free number for details about the claim. 
• Home Pick up of Claims: LIC does not provide the benefit of picking up the required documents for the claim settlement from your home. Your family or nominee will have to visit LIC’s branch to submit the documents themselves.
• Toll-Free Services: Based on our in-house team’s research, we found that LIC’s toll-free service is quicker compared to other insurers. Your family or nominee could contact this service for any issues related to the claim process. 
• Response over Twitter: As per our research, we found that the response rate of the insurer over Twitter is slow compared to other insurers. Hence, toll-free would be an ideal choice for your nominee to connect with the insurer in case they face any difficulties at the time of claim. 

Ensure to discuss all these important details with your nominee or family while finalizing the term insurance purchase. 

About the Insurer- Life Insurance Company

LIC also known as Life Insurance Corporation of India is an Indian Life Insurance Company. It offers Term Life Insurance Plans, Traditional Savings Plans, and Unit Linked Insurance Plans. Founded in 1956, it is owned by the Government of India. The company is headquartered in Mumbai and functions with 2048 fully computerized branch offices, 113 divisional offices, 8 zonal offices, 1381 satellite offices, and the Corporate office. The chairman of the company is Mr. M R Kumar.

An Overall LIC Tech Term Plan Review

Considering all the product benefits, customer service, and claims experience and based on the 100+ parameters analyzed by our in-house research team, LIC Tech Term Plan gets a Beshak⭐Rating of 3.9/5.