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What is LIC Yuva Term Plan?

It’s a pure risk (term) life insurance — no maturity benefit.

Plan number: 875.

Launched by LIC on 5th August 2024.

Intended for young customers (hence “Yuva”), to provide large life cover at relatively affordable premiums.



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Key Features / Benefits

1. Eligibility

Entry age: 18 to 45 years (last birthday).

Maturity age: 33 to 75 years (last birthday).



2. Sum Assured

Minimum: ₹50 lakh.

Maximum: ₹5 crore (higher amounts may be considered in some cases).

Sum assured multiples are defined in slabs.



3. Policy Term and Premium Payment Options

Policy term: 15 to 40 years (depending on the payment mode) for regular / single pay.

Premium payment options:

Regular Premium

Limited Premium (10 or 15 years)

Single Premium (pay all at once)




4. Death Benefit Options
Two “Sum Assured” options:

Level Sum Assured: fixed sum assured throughout.

Increasing Sum Assured:

Sum assured increases by 10% annually from year 6 to year 15.

By year 15, it doubles the basic sum assured; after that, it stays constant.




5. Death Benefit Amount Calculation
Based on the premium option:

For Regular / Limited Premium: Death benefit = highest of:

1. 7× annualized premium,


2. 105% of total premiums paid up to death,


3. Absolute sum assured.



For Single Premium: Death benefit = higher of:

1. 125% of single premium, or


2. Absolute sum assured.





6. Special Rates / Rebates

High sum-assured rebate (i.e., cheaper per-unit premium for larger cover)

Lower premium rates for women.

Two premium rate categories: Non-smoker vs Smoker.



7. Settlement Option

Death proceeds can be paid in installments (settlement option) for 5, 10, or 15 years.

You can choose payment frequency: monthly, quarterly, half-yearly, or yearly.



8. Policy Grace Period

If premium is regular/limited: 30-day grace period for paying overdue premiums.

If a premium is missed but paid within the grace period, risk cover continues.



9. Tax Benefits

Premiums are eligible for deduction under Section 80C.

Death benefit is tax-free under Section 10(10D).



10. Policy Lapse / Surrender

Since it's a term plan, there is no maturity benefit.

For regular premium policies, surrender value is nil.





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Pros (Advantages)

Good protection: Because it's a term plan, you can get a high sum assured for relatively lower premium compared to savings-linked policies.

Flexible payment options (single, limited, or regular) depending on your cash flow.

Increasing cover option helps if you expect your financial responsibilities to grow (e.g., marriage, kids).

Attractive rebates for high sum assured and for women — makes it more affordable.

You can choose settlement option to pay death benefit in installments, which can be useful for your family.



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Cons / Things to Consider

No maturity benefit: If you survive the policy term, you don’t get anything back (because it’s pure risk cover).

Premium commitment: For regular or limited premium, you must pay for the agreed term; missing payments can lapse the policy (unless within grace).

Medical underwriting likely: For high sum assured, LIC may require medical tests.

Opportunity cost: The money you pay in premium could be invested elsewhere if you don’t need a very high risk cover.

If you choose increasing sum assured, the benefit depends on policy lasting 15 years to reach the maximum increase.



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My Thoughts / Recommendation

Good for young people: Since the plan is targeted at “yuva” (youth), it’s quite suited for someone in their 20s or 30s who wants large life cover at a lower cost.

Calculate your cover needs carefully: Think about how much your family would need if you were not there — include liabilities (loans), living expenses, future goals (education, marriage).

Use a term plan + investment combo: Many financial planners suggest taking a pure term plan (for risk) + separately investing (in mutual funds / SIP) for wealth creation.

Compare with other insurers: LIC is trusted, but some private insurers might offer lower premiums or more flexible features — check a few before final decision.

Get quotes: Use LIC’s premium calculator (or consult an agent) for different policy terms and sum assured options to see what premium works for you.

K. SATYANARAYANA RAJU
LIC &HEALTH INSURANCE ADVISOR
KUKATPALLY
HYDERABAD
CELL :8885907939
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