Introduction to LIC Nivesh Plus (Plan No. 849)
LIC Nivesh Plus (Plan No. 849, UIN: 512L317V01) is a non-participating, unit-linked, single premium individual life insurance plan offered by the Life Insurance Corporation of India. Combining the dual advantages of investment in capital markets with life insurance coverage, Nivesh Plus allows investors to deploy a one-time lump-sum surplus into professionally managed market funds with complete flexibility, zero renewal premium hassles, and attractive Guaranteed Additions credited at milestone policy intervals.
Unlike regular premium ULIPs that require continuous yearly funding, Nivesh Plus is a true single-deposit instrument ideal for investing bonuses, property sale proceeds, or retirement gratuity surpluses.
Two Distinct Life Cover Options
- Option 1 (1.25x Single Premium): Life cover is 1.25 times the single premium. This option is popular among investment-focused individuals because lower mortality charges are deducted from the fund, leaving a larger portion of money compounding in market units.
- Option 2 (10x Single Premium): Life cover is 10 times the single premium. This option is favored by individuals seeking substantial life protection alongside market growth and ensures seamless tax-free maturity eligibility under Section 10(10D).
Four Diverse Investment Fund Choices
Investors can allocate their single premium across four specialized unit funds according to their personal risk appetite:
| Fund Type | Equity Asset Allocation | Debt & Money Market Allocation | Risk Profile |
|---|---|---|---|
| Bond Fund | 0% (Pure Debt) | 100% (Govt Securities & Corporate Bonds) | Low Risk |
| Secured Fund | 15% to 55% Equities | 45% to 85% Debt Instruments | Lower to Medium Risk |
| Balanced Fund | 30% to 70% Equities | 30% to 70% Debt Instruments | Medium Risk |
| Growth Fund | 40% to 80% Equities | 20% to 60% Debt Instruments | High Risk |
Milestone Guaranteed Additions
A signature benefit of LIC Nivesh Plus is that LIC contributes extra units to your fund value as guaranteed loyalty bonuses:
- End of 6th Policy Year: 3% to 5% of Single Premium added.
- End of 10th Policy Year: 4% to 7% of Single Premium added.
- End of 15th Policy Year: 5% to 8% of Single Premium added.
- End of 20th Policy Year: 6% to 9% of Single Premium added.
- End of 25th Policy Year: 7% to 10% of Single Premium added.
Dual-Scenario Returns: 4% vs 8% IRR Projections
Under IRDAI consumer disclosure rules, ULIP performance must be illustrated at gross returns of 4% p.a. (conservative scenario) and 8% p.a. (optimistic scenario):
| Single Premium | Tenure | Life Cover (Option 1) | Projected Fund Value (@ 4%) | Projected Fund Value (@ 8%) |
|---|---|---|---|---|
| ₹1,00,000 | 15 Years | ₹1,25,000 | ₹1,51,315 | ₹2,57,182 |
| ₹2,00,000 | 15 Years | ₹2,50,000 | ₹3,02,630 | ₹5,14,364 |
| ₹5,00,000 | 15 Years | ₹6,25,000 | ₹7,56,575 | ₹12,85,910 |
| ₹10,00,000 | 15 Years | ₹12,50,000 | ₹15,13,150 | ₹25,71,820 |
Mortality Charge Refund Feature
In LIC Nivesh Plus, all mortality charges deducted throughout the policy term to provide life insurance cover are completely refunded back into your unit fund upon maturity! This innovative feature transforms the plan into an ultra-cost-effective wealth accumulation engine.
Taxation Status Under Section 10(10D) & Budget Revisions
Under the revised tax framework introduced for Unit Linked Insurance Plans (ULIPs), proceeds on maturity are completely tax-free under Section 10(10D) provided the aggregate annual premium paid on all ULIPs does not exceed ₹2,50,000 in a financial year. Furthermore, to qualify for Section 10(10D) tax exemption, the minimum sum assured must be at least 10 times the annual premium (Option 2). In case of Option 1 (1.25x cover), returns are taxed like equity mutual funds under capital gains rules.
Strategic Tips for Investing in Single Premium ULIPs
- Leverage Free Fund Switches: Use the 4 free annual switches to shift from Growth Fund to Bond Fund during market peaks, locking in equity gains before major market corrections.
- Hold for at Least 10 to 15 Years: While the mandatory lock-in is 5 years, staying invested for 15+ years unlocks higher Guaranteed Additions (up to 8% to 10%) and full mortality charge refund benefits.
- Nomination & Assignment: Ensure active nominations are registered and utilize the policy assignment option if seeking secured liquidity from lenders.