LIC has launched a health insurance plan called the LIC Cancer Cover. This LIC critical illness insurance policy provides financial security to the life assured. Cancer is a critical illness and LIC cancer covers both early and major stage cancer. It is a non-linked and non-participating health insurance plan. A guaranteed benefit plan which is a good cancer cover plan.
This is a specific disease cover plan. There are no maturity benefits, surrender value or loan facility allowed.
What is the LIC Cancer Cover Plan 905? What is the benefit options provided?
This is a very good plan when it comes to covering a critical illness like cancer. There are basically two benefit options available in this cancer cover plan
Option 1 – Level Sum Insured
In this option, the basic sum insured shall remain unchanged throughout the policy term.
Option 2 – Increasing Sum Insured
In this option, the basic sum insured increases by 10% every year. This increase happens every year for first five years starting from the 1st policy anniversary or until the diagnosis of 1st event of Cancer, whichever is earlier.
How are the benefits payable under the plan?
The benefits are payable on the Applicable Sum Insured, where the Applicable Sum Insured is equal to-
- Under Option 1 – The Basic Sum Insured for policies taken
- Under Option 2 – Basic Sum Insured during first year and Increased Sum Insured thereafter.
Say, you take a 10 lakhs cover. This increases by 10% per year. So every year it will increase by INR 1 lakh every year for 5 years. The maximum it can reach would be INR 15 lakhs.
In the 3rd year, say there is a diagnosis of cancer. Then the increased cover will reach INR 13 lakhs, it would not increase in the next 2 years.
Is the LIC Cancer Cover Plan 905 good?
Let us take a look on the benefits payable under this policy. This would cover both early stage and major stage cancer.
LIC Cancer Cover Plan is worth getting because of the benefits that it brings.
In case of a specified early stage cancer detection. These would be the following benefits.
Lump sum benefit: 25% of Applicable Sum Insured shall be payable
Premium Waiver Benefit: The next 3 policy years premium or balance policy term whichever is lower, is waived from the policy anniversary coinciding or following the date of diagnosis.
For a detection of specified major stage cancer. These would be the following benefits.
Entire Lump Sum Amount Benefit: 100% of Applicable Sum Insured less any previously paid claims in respect of Early Stage Cancer shall be payable.
Income Benefit: In addition to above lump sum benefit, Income Benefit of 1% of Applicable Sum Insured shall be payable on each policy month following the payment of Lump Sum, for a fixed period of next ten years irrespective of the survival of the Life Insured and even if this period of 10 years goes beyond the policy term. In case of death of the Life Assured while receiving this Income Benefit, the remaining payouts, if any, will be paid to his/her nominee.
Premium Waiver Benefit: All the future premiums shall be waived from the next
policy anniversary and the policy shall be free from all liabilities except to the extent of Income Benefit as specified above.
What is the eligibility criteria for LIC Cancer Cover Plan 905?
(a) Minimum age at entry: 20 years (completed)
(b) Maximum age at entry: 65 years (last birthday)
(c) Minimum Policy Term: 10 years
(d) Maximum Policy Term: 30 years
(e) Minimum age at maturity: 50 years
(f) Maximum age at maturity: 75 years
(g) Minimum Premium: Rs. 2400/- for all modes
(h) Minimum Basic Sum Insured: Rs.10,00,000
(i) Maximum Basic Sum Insured: Rs. 50,00,000
The maximum Basic Sum Insured under this plan shall not exceed an overall limit of Rs.50 lakhs taking all existing Critical Illness Cover policies including Cancer Cover and the Cancer Cover Sum Insured under the new proposal into consideration. The Basic Sum Insured shall be in multiples of Rs. 1,00,000/- only.
Points to remember for LIC Cancer Cover Plan
Benefit Limits and Conditions:
The Early Stage Cancer Benefit shall be payable only once for the 1st ever event. Life Assured cannot make another claim for the Early Stage Cancer of same or any other cancer. However, the coverage for the Major Stage Cancer under the policy shall continue until the policy terminates.
Once a Major Stage Cancer Benefit paid, no payment for any future claims under Early Stage Cancer or Major Stage Cancer would be admissible.
The maximum amount that can be claimed is 220% of Applicable Sum Insured. This is total benefit under the Policy including Early Stage Cancer Benefit and Major Stage Cancer.
In case, life assured claims for different stages of the same Cancer at the same time, the benefit shall only be payable for the higher claim admitted under the policy.
In case, there is more than one Cancer diagnosed in an event, the Corporation will only pay one benefit. That benefit would be the highest benefit amount, relating to the stage of Cancer.
Waiting and Survival Period for the LIC Cancer Cover Plan
Waiting Period – A waiting period of 180 days will apply from the date of issuance of policy or date of revival of risk cover, whichever is later, to the first diagnosis of any stage cancer. “Any stage” here means all stages of Cancer that occur during the waiting period. No benefit shall be payable if any stage of Cancer occur before expiry of 180 days from the date of issuance of policy or date of revival and the policy shall terminate.
No benefit shall be payable if the Life Assured dies within a period of 7 days from the date of diagnosis of any of the specified Early Stage Cancer or Major Stage Cancer. The 7 days survival period includes the date of diagnosis.
How are the premium payments done?
The premium is paid on a half yearly or yearly mode. A maximum grace period of 30 days is allowed on both the type of modes.
Still thinking! Why should you go for this LIC Cancer cover Health Insurance Plan?
Is Cancer Insurance worth getting? This a question that might come to your mind. Actually once your basic health insurance policy is in place, you should look at buying critical illness plans. These plans come in handy due to its lump sum payout feature on diagnosis of cancer.
Most people think it is not important to have cancer insurance. They think that their existing health insurance will be sufficient. A cancer insurance policy is a step ahead and provides high cover for a relatively low premium.
Think about this! LIC Cancer Cover plan provides the insurance amount on diagnosis of illness, irrespective of the actual treatment amount spent. This helps you to recover without worrying too much about the bills. No need for hospitalization for getting the claim.
Here you get the lump sum benefit equal to the sum insured. This can be paid for the medication, post treatment and helps you recover while you are away from work, since such treatments take time. Think of this as an income replacement policy. The entire insurance amount may not be exhausted on treatment. you can also pay off your debt, if any while you recuperate.
LIC Cancer Cover provides tax benefits as well. The premiums paid for are eligible for tax deductions under Section 80D of the Income Tax Act for up to the limit of INR 50,000.
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