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Can the LIC New Jeevan Sathi Single Premium Plan truly provide lasting financial protection for both partners, or is it just another traditional insurance plan with limited benefits?
Does the LIC New Jeevan Sathi Single Premium Plan offer adequate protection for couples, or are there better life insurance alternatives available?
Can the LIC New Jeevan Sathi Single Premium Plan provide the financial security your spouse needs, or is its coverage inadequate for your family’s long-term needs?
This article examines the features, benefits, and drawbacks of the LIC New Jeevan Sathi – Single Premium Plan to help you assess its suitability before investing.
Table of Contents:
What is the LIC New Jeevan Sathi – Single Premium?
What are the features of the LIC New Jeevan Sathi – Single Premium?
Who is eligible for the LIC New Jeevan Sathi – Single Premium?
What are the benefits of the LIC New Jeevan Sathi – Single Premium?
Free Look Period for the LIC New Jeevan Sathi – Single Premium
Surrendering the LIC New Jeevan Sathi – Single Premium
What are the advantages of the LIC New Jeevan Sathi – Single Premium?
What are the disadvantages of the LIC New Jeevan Sathi – Single Premium?
Research Methodology of LIC New Jeevan Sathi – Single Premium
Benefit Illustration – IRR Analysis of LIC New Jeevan Sathi – Single Premium
LIC New Jeevan Sathi – Single Premium Vs. Other Investment
LIC New Jeevan Sathi – Single Premium Vs. Pure-term + Equity Mutual Fund
Final Verdict on LIC New Jeevan Sathi – Single Premium
What is the LIC New Jeevan Sathi – Single Premium?
LIC New Jeevan Sathi – Single Premium is a Non-Par, Non-Linked, Life, Individual, Savings plan. This is a Joint Life Single Premium Endowment plan with Guaranteed Addition. This plan offers a combination of saving and protection.
What are the features of the LIC New Jeevan Sathi – Single Premium?
- Single premium payment – As this is a single-premium plan, the entire premium is paid upfront, with no recurring premium obligation.
- Joint life coverage – Covers the policyholder and their spouse under a single policy.
- Guaranteed Additions – Earns Guaranteed Additions of ₹70 per ₹1,000 of Basic Sum Assured throughout the policy term.
- Choice of death benefit – Offers two Death Benefit Options and flexibility to select based on your needs.
- Instalment payment option – The maturity or death benefit can be received in instalments instead of as a lump sum.
- High Sum Assured Rebate – Provides a rebate for opting for a higher sum assured.
- Existing policyholder rebate – Offers a rebate to existing policyholders and the nominees/beneficiaries of deceased policyholders.
- Loan facility – Provides a loan facility to meet liquidity requirements during the policy term.
Who is eligible for the LIC New Jeevan Sathi – Single Premium?
| Minimum Age at entry (for both lives) | 18 years (Completed) (for both Option I and Option II) |
| Maximum Age at Entry (for both lives) | Option I: 60 years (Nearer Birthday)Option II: 35 years (Nearer Birthday) |
| Policy Term | Option I: 10,15, 20 and 25 yearsOption II: 10 and15 years |
| Minimum Age at Maturity | 28 years (completed) under both Options I and II |
| Maximum Age at Maturity | Option I: 75 years (Nearer Birthday)Option II: 50 years (Nearer Birthday) |
| Premium Payment Term | Single Premium |
| Minimum Basic Sum Assured | ₹ 3,00,000 |
| Maximum Basic Sum Assured | No limits. However, the maximum Basic Sum Assured allowed to each individual will be subject to an underwriting decision as per the Board-Approved Underwriting Policy |
| Basic Sum Assured multiple | ₹ 25,000 |
What are the benefits of the LIC New Jeevan Sathi – Single Premium?
1. Death Benefit
Two options for “Sum Assured on Death” are available under the product. The Primary Life Assured has to choose one of the below-mentioned options at the proposal stage itself, subject to the eligibility conditions
Option I
Higher of
- 1.25 times of Tabular Single Premium: or
- Basic Sum Assured
Option II
- 10 times of Tabular Single Premium
On first death during the Policy Term:
Death Benefit payable on first death during the LIC New Jeevan Sathi Single Premium Plan Policy Term after the date of commencement of risk but before the date of Maturity shall be equal to “Sum Assured on Death”, and the policy shall continue on the life of surviving Life Assured.
On second death during the Policy Term:
Death Benefit payable on second death during the LIC New Jeevan Sathi Single Premium Plan Policy Term after the date of commencement of risk but before the date of Maturity shall be equal to “Sum Assured on Death” along with accrued Guaranteed Additions and the policy shall terminate thereafter.
2. Maturity Benefit
On survival of at least one of the lives assured to the stipulated Date of Maturity, “Sum Assured on Maturity” along with accrued Guaranteed Additions, shall be payable; where “Sum Assured on Maturity” is equal to the Basic Sum Assured.
3. Guaranteed Additions
The Guaranteed Additions shall accrue annually at the rate of Rs. 70 per thousand Basic Sum Assured at the end of each policy year during the Policy Term.
On second death during the LIC New Jeevan Sathi Single Premium Plan Policy Term, the Guaranteed Additions in the year of death shall be payable for the full policy year.
Free Look Period for the LIC New Jeevan Sathi – Single Premium
If the Policyholder is not satisfied with the “Terms and Conditions” of the policy, the policy may be returned to the Corporation within 30 days from the date of receipt of the electronic or physical mode of the Policy Document, whichever is earlier.
Surrendering the LIC New Jeevan Sathi – Single Premium
The policy can be surrendered at any time during the Policy Term.
On surrender of a policy, the Corporation shall pay the Surrender Value, higher of: a) Guaranteed Surrender Value (GSV) and surrender value of any accrued Guaranteed Additions or b) Special Surrender Value (SSV).
The Guaranteed Surrender Value payable under the policy shall be as under: –
During first three policy years: 75% of the Single Premium paid
Thereafter: 90% of the Single Premium paid.
What are the advantages of the LIC New Jeevan Sathi – Single Premium?
- Enhanced coverage through riders – You can increase the policy coverage by opting for additional rider benefits at an extra premium.
- Settlement Option – The Maturity Benefit can be received in instalments over 5, 10, or 15 years instead of as a lump sum.
- Higher Sum Assured Rebate – A higher Basic Sum Assured (BSA) qualifies for a rebate through a reduction in the tabular premium.
- Loan facility – A loan can be availed against the policy, subject to the available surrender value.
What are the disadvantages of the LIC New Jeevan Sathi – Single Premium?
- Limited liquidity – Your investment remains locked in until the policy term ends, limiting access to your money during the policy period.
- Limited policy-term flexibility – The plan offers only a limited choice of policy terms.
- Inadequate life cover – Although the plan provides joint life protection, the sum assured may be insufficient to meet the family’s financial protection needs.
- Low returns – The returns are relatively modest compared with other investment options available in the market.
Research Methodology of LIC New Jeevan Sathi – Single Premium
The LIC New Jeevan Sathi – Single Premium Plan offers guaranteed maturity benefits against a one-time premium payment.
However, the guaranteed benefit alone does not indicate whether the investment is worthwhile.
Calculating the Internal Rate of Return (IRR) provides a clearer picture of the actual returns.
Benefit Illustration – IRR Analysis of LIC New Jeevan Sathi – Single Premium
For example, a 35-year-old male pays a single premium of ₹8,12,750 under Plan Option I for a 20-year policy term, with a Basic Sum Assured of ₹10 lakh.
The death benefit is ₹10.52 lakh on the first death and ₹24.52 lakh on the second death.
At maturity, the policyholder receives ₹24 lakh, translating to an IRR of just 5.56% as per the LIC New Jeevan Sathi Single Premium Plan maturity calculator.
| Age of Primary and Secondary Life Insured | 35 years |
| Basic Sum Assured | ₹ 10,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | Single Premium |
| Single Premium | ₹ 8,12,750 |
| Age | Year | Annualised premium / Maturity benefit | Death benefit payable on First Death | Death benefit payable on Second Death |
| 35 | 1 | -8,12,750 | 10,52,188 | 11,22,188 |
| 36 | 2 | 0 | 10,52,188 | 11,92,188 |
| 37 | 3 | 0 | 10,52,188 | 12,62,188 |
| 38 | 4 | 0 | 10,52,188 | 13,32,188 |
| 39 | 5 | 0 | 10,52,188 | 14,02,188 |
| 40 | 6 | 0 | 10,52,188 | 14,72,188 |
| 41 | 7 | 0 | 10,52,188 | 15,42,188 |
| 42 | 8 | 0 | 10,52,188 | 16,12,188 |
| 43 | 9 | 0 | 10,52,188 | 16,82,188 |
| 44 | 10 | 0 | 10,52,188 | 17,52,188 |
| 45 | 11 | 0 | 10,52,188 | 18,22,188 |
| 46 | 12 | 0 | 10,52,188 | 18,92,188 |
| 47 | 13 | 0 | 10,52,188 | 19,62,188 |
| 48 | 14 | 0 | 10,52,188 | 20,32,188 |
| 49 | 15 | 0 | 10,52,188 | 21,02,188 |
| 50 | 16 | 0 | 10,52,188 | 21,72,188 |
| 51 | 17 | 0 | 10,52,188 | 22,42,188 |
| 52 | 18 | 0 | 10,52,188 | 23,12,188 |
| 53 | 19 | 0 | 10,52,188 | 23,82,188 |
| 54 | 20 | 0 | 10,52,188 | 24,52,188 |
| 55 | 24,00,000 | |||
| IRR | 5.56% |
Although the plan provides guaranteed benefits, a significant portion of the premium goes towards providing life cover for both lives, which limits the investment return.
The resulting IRR is relatively low compared with other fixed-income options.
For example, a long-term bank fixed deposit may offer comparable or better returns while providing greater liquidity.
In contrast, the funds invested in this plan remain locked in for the policy term. The combination of modest returns and limited liquidity makes this a less attractive investment option.
LIC New Jeevan Sathi – Single Premium Vs. Other Investment
Given the underwhelming returns from the LIC New Jeevan Sathi – Single Premium Plan, it is worth considering a more efficient way to meet the same objectives.
Since the plan combines insurance and investment, the alternative strategy should address these needs separately through term insurance for protection and investments for wealth creation.
LIC New Jeevan Sathi – Single Premium Vs. Pure-term + Equity Mutual Fund
Instead of bundling both components, opt for pure-term insurance. For a 20-year term, coverage of ₹10.50 lakh for the primary life and ₹24.50 lakh for the secondary life costs approximately ₹1.50 lakh in total (₹55,500 + ₹94,600).
This is significantly lower than the ₹8.12 lakh premium under the LIC plan, leaving ₹6.62 lakh available for investment.
| Pure Term Life Insurance Policy | |
| Basic Sum Assured | ₹ 10,00,000 |
| Policy Term | 20 years |
| Premium Paying Term | Single Premium |
| Annualised Premium | ₹ 1,50,100 |
| Investment | ₹ 6,62,650 |
| Term insurance + Equity Mutual Fund | ||||
| Age | Year | Term Insurance premium + Equity Mutual Fund | Death benefit payable on First Death | Death benefit payable on Second Death |
| 35 | 1 | -8,12,750 | 10,50,000 | 24,50,000 |
| 36 | 2 | 0 | 10,50,000 | 24,50,000 |
| 37 | 3 | 0 | 10,50,000 | 24,50,000 |
| 38 | 4 | 0 | 10,50,000 | 24,50,000 |
| 39 | 5 | 0 | 10,50,000 | 24,50,000 |
| 40 | 6 | 0 | 10,50,000 | 24,50,000 |
| 41 | 7 | 0 | 10,50,000 | 24,50,000 |
| 42 | 8 | 0 | 10,50,000 | 24,50,000 |
| 43 | 9 | 0 | 10,50,000 | 24,50,000 |
| 44 | 10 | 0 | 10,50,000 | 24,50,000 |
| 45 | 11 | 0 | 10,50,000 | 24,50,000 |
| 46 | 12 | 0 | 10,50,000 | 24,50,000 |
| 47 | 13 | 0 | 10,50,000 | 24,50,000 |
| 48 | 14 | 0 | 10,50,000 | 24,50,000 |
| 49 | 15 | 0 | 10,50,000 | 24,50,000 |
| 50 | 16 | 0 | 10,50,000 | 24,50,000 |
| 51 | 17 | 0 | 10,50,000 | 24,50,000 |
| 52 | 18 | 0 | 10,50,000 | 24,50,000 |
| 53 | 19 | 0 | 10,50,000 | 24,50,000 |
| 54 | 20 | 0 | 10,50,000 | 24,50,000 |
| 55 | 56,91,558 | |||
| IRR | 10.22% | |||
Conservative investors can consider fixed-income or debt instruments, while growth-oriented investors may consider equity mutual funds.
Assuming the ₹6.60 lakh surplus is invested in an equity mutual fund, it could grow to approximately ₹63.92 lakh before tax over 20 years.
After long-term capital gains tax, the estimated value would be ₹56.91 lakh.
| Equity Mutual Fund Tax Calculation | |
| Maturity value after 20 years | 63,92,116 |
| Purchase price | 6,62,650 |
| Long-Term Capital Gains | 57,29,466 |
| Exemption limit | 1,25,000 |
| Taxable LTCG | 56,04,466 |
| Tax paid on LTCG | 7,00,558 |
| Maturity value after tax | 56,91,558 |
The combined post-tax IRR from the equity investment and two term insurance policies is estimated at 10.22%, significantly higher than the 5.56% IRR offered by the LIC New Jeevan Sathi – Single Premium Plan.
This approach provides higher potential returns, greater liquidity, and cost-effective life protection.
In comparison, the LIC plan offers modest returns with limited liquidity and flexibility, making the separate insurance-and-investment strategy a more efficient alternative.
Final Verdict on LIC New Jeevan Sathi – Single Premium
The LIC New Jeevan Sathi – Single Premium Plan is a traditional endowment plan that combines lump-sum investment, guaranteed maturity benefits, and joint life cover.
While this may seem like an attractive combination of insurance and investment, bundling the two can compromise the effectiveness of both.
The long lock-in period and relatively low returns, even compared with several debt instruments, make the plan less suitable for long-term wealth creation and it also has a high agent commission.
Although joint life protection is a key feature, the coverage is limited and less cost-effective than a pure-term life insurance policy.
A pure-term insurance policy can provide substantially higher life cover at a much lower cost. The amount saved on insurance can then be invested in growth-oriented instruments, such as mutual funds, based on your risk profile and financial goals.
Separating insurance from investment can therefore provide better potential returns, greater flexibility, and adequate financial protection.
Do Quora, Facebook, and Twitter have the final say when it comes to financial advice?
If you are unsure how to structure your financial plan, consider consulting a Certified Financial Planner (CFP). A CFP can help align your investments and insurance with your goals, time horizon, and risk tolerance, so your money is used more efficiently.
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