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Comprehensive Guide to Choosing the Best LIC Service for Your Needs

Your Guide to buying the best LIC service

Overview

"Comprehensive Guide to Buying LIC Services: Navigating the Life Insurance Landscape" Buying a Life Insurance Corporation (LIC) service can be a daunting task, especially with a myriad of options available in the market. This comprehensive guide is designed to provide you with all the necessary information you need to make the best decision. We'll delve into the various types of LIC services, the factors to consider when purchasing, and how to choose a service that aligns with your individual needs and goals. Whether you're a beginner or seasoned buyer, this guide will help you navigate the complex landscape of life insurance.

Key features

Type of Plan: Understand the different types of LIC plans available such as term insurance, endowment plans, ULIPs, money back policies etc., and select one that suits your financial goals and risk appetite.
Sum Assured: Consider the amount of coverage you need based on your financial obligations and dependents. Make sure the sum assured is adequate to provide financial security for your family in your absence.
Premium Payment: Check the premium amount and payment frequency. Ensure that it fits within your budget. Also consider the premium payment term.
Claim Settlement Ratio: A higher claim settlement ratio indicates that the insurer is more likely to settle claims. This is an important factor to consider for your peace of mind.
Solvency Ratio: The solvency ratio indicates the financial health of the insurance company. A higher ratio means that the company is more capable of meeting its long-term obligations.
Policy Term: Consider the term of the policy based on your retirement age and financial goals. Ensure that the policy term aligns with your long-term financial planning.
Riders: Check if the policy offers additional riders such as critical illness rider, accident death and disability rider etc., to enhance your coverage.
Customer Service: Consider the insurer's reputation for customer service. This includes ease of buying and renewing policies, promptness in servicing claims, and transparency in dealings.

Important considerations

Pros

Security and Assurance: LIC being a government organization, ensures a strong sense of security and assurance for your investments.
Variety of Plans: LIC offers a wide range of insurance plans catering to different needs such as term insurance, endowment plans, whole life plans, money back plans, ULIPs etc.
High Claim Settlement Ratio: LIC has one of the highest claim settlement ratios in the insurance industry, ensuring that the claims of the policyholder are met without any hassles.
Customer Service: LIC offers excellent customer service with a wide network of branches and online services for the convenience of its policyholders.
Loan Facility: LIC policies offer loan facilities. Policyholders can avail loans up to a certain percentage of the surrender value of the policy.
Tax Benefits: The premium paid towards LIC policies is eligible for tax benefits under Section 80C of the Income Tax Act. The sum assured received on maturity/death is also tax-free under Section 10(10D).

Cons

Policy Tenure: LIC services often require a long-term commitment. You might not be able to opt-out easily without incurring losses if your financial situation changes.
Higher Premiums: Compared to other insurance firms, LIC often has higher premiums, which could be a financial burden.
Limited Flexibility: LIC services often come with rigid plans with less flexibility in terms of payment options, policy terms, or coverage choices.
Slow Digital Integration: LIC is sometimes slow in digitalizing its operations, which can lead to a slower and less efficient customer service experience compared to other companies.
Lower Returns: Compared to market-linked insurance plans, traditional LIC policies might generate lower returns over the long term.

Best alternatives

HDFC Life Insurance: This is a reputable insurance provider that offers a wide range of services including term insurance, ULIPs, pension plans and child insurance plans.
ICICI Prudential Life Insurance: Offering a comprehensive range of policies, ICICI Prudential is known for its excellent customer service and competitive prices.
Max Life Insurance: Max Life offers both long term and short term insurance policies and is renowned for its easy claim settlement process.
SBI Life Insurance: This insurance company is owned by the State Bank of India and is known for its reliable services and wide network across the country.
Bajaj Allianz Life Insurance: Known for its innovative products, Bajaj Allianz offers a range of insurance plans including ULIPs, term insurance, child plans, savings plans and more.

Related tools, supplies, and accessories

Life Insurance Policy - This is the main product provided by LIC. It is a contract between the policyholder and the insurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person.
Annuity Plan - This is a retirement product that pays out income and can be used as part of a comprehensive retirement strategy. Annuity Plans are long term investment products from LIC that provide periodic income during the survival of the policyholder.
Health Insurance - This product from LIC provides coverage for medical expenses that may arise due to unforeseen health issues.
Child Plan - This is a savings plan from LIC for the future of your children. It provides financial cover for your child’s future needs like education and marriage.
Investment Plan - LIC offers a variety of investment plans where the policyholder can invest their money for a specific period and get guaranteed returns.
Term Plan - This is a type of life insurance policy that provides coverage for a certain period of time, or a specified "term" of years. If the insured dies during the time period specified in the plan and the policy is active, a death benefit will be paid.
Pension Plan - This product from LIC provides a regular monthly income after retirement.

Common questions

What is LIC service?
LIC service refers to the various services offered by the Life Insurance Corporation of India (LIC). These services range from different types of insurance policies like life insurance, health insurance, and term insurance, to investment products like mutual funds, pension plans, and unit-linked investment plans.
Why should I consider buying LIC service?
Investing in LIC service provides financial security and savings growth. Depending on the LIC service you choose, it can offer life cover, retirement savings, and opportunities for wealth creation. It can also provide tax benefits as most of the LIC products are tax exempted under various sections of the Income Tax Act.
How do I choose the right LIC service?
Choosing the right LIC service depends on your financial goals and needs. For example, if you want to ensure your family's financial security in your absence, you should consider a life insurance policy. If you're looking to grow your wealth over time, an investment product like a mutual fund or a unit-linked investment plan might be a better option.
What are the different types of LIC services available?
There are a variety of LIC services available, including life insurance plans, health insurance plans, pension plans, children's plans, unit linked insurance plans, special plans, and group schemes among others.
How do I purchase an LIC service?
You can purchase LIC service by visiting an LIC branch, contacting an LIC agent, or buying it online directly from the LIC website. It's important to compare different policies, understand their features and benefits, and choose one that fits your needs before purchasing.
Can I buy LIC service online?
Yes, most of the LIC services can be purchased online directly from the LIC website. Online purchase offers convenience as you can compare different policies, pay the premium, and get the policy document at your home's comfort.
What information will I need to provide when buying LIC service?
When buying LIC service, you will need to provide your personal information including date of birth, contact details, income details, lifestyle habits, and medical history (if required).
How do I pay for the LIC service?
You can pay for LIC service online through net banking, debit card, or credit card. Alternatively, you can also pay via cheque or cash at an LIC branch.
What if I want to cancel my LIC service?
If you want to cancel your LIC service, you can do so within the free look period (usually 15 days from the date of receiving the policy document). You'll receive a refund of your premium paid, minus certain deductions as per the LIC policy terms and conditions.

Trivia

Did you know that the Life Insurance Corporation of India, widely known as LIC, is not just one of the largest insurance companies in India, but it also happens to be one of India's largest real estate owners? The insurer giant, established in 1956, owns vast properties across the country - from commercial buildings to residential properties and lands. In fact, it's so extensive that LIC's real estate portfolio is estimated to be worth a staggering INR 30000 Crore (nearly $4 billion). So, when you're purchasing an LIC policy, you're dealing with a company that doesn't just know about insurance, but also has a fair bit of knowledge about the value of good real estate too! [Source](https://www.businesstoday.in/current/corporate/lic-is-india-largest-real-estate-owner-what-its-ipo-means-for-market/story/431124.html)

Disclaimer: This buying guide was not created by humans, and it is possible that some of it's content is inaccurate or incomplete. We do not guarantee or take any liability for the accuracy of this buying guide. Additionally, the images on this page were generated by AI and may not accurately represent the product that is being discussed. We have tried to convey useful information, but it is our subjective opinion and should not be taken as complete or factual.