What is Money Back Policy? What its features and Benefits?

What is Money Back Policy? What its features and Benefits?

LIC Money Back policies are unique life insurance plans that blend insurance and savings components. These policies offer not only survival benefits but also provide periodic maturity benefits every 5 years, catering to diverse financial needs throughout the policy duration.

LIC of India provides a range of 7 money back plans, each offering unique benefits and features to suit various financial requirements:

1. New Money Back Policy – 20 years
2. New Money Back Policy – 25 years
3. LIC’s Bima Shree
4. LIC’s Jeevan Shiromani
5. LIC’s New Bima Bachat
6. LIC’s New Children’s Money Back Plan
7. LIC’s Jeevan Tarun

These diverse options allow individuals to choose the most suitable LIC Money Back plan based on their financial goals, risk appetite, and the desired policy term.

Eligibility Criteria:

To avail any of the mentioned LIC Money Back plans, individuals need to meet the following general conditions:

Particulars Details
Entry Age From 90 days up to No Limit
Maturity Age From 25 years up to 75 years
Minimum Premium Amount Not Applicable (varies based on the chosen plan)
Minimum Sum Assured Rs. 1,00,000 up to No Limit (depending on the plan)
Policy Term From 9 years up to 25 years (depending on the plan)

Documents Required to Purchase Plans:

To purchase any of the LIC Money Back plans, the following documents are essential:

1. Application Form/Proposal Form (duly filled and signed)
2. Age Proof (birth certificate, PAN card, Aadhar Card, etc.)
3. Photo ID Proof (passport, Aadhar Card, voter’s ID card, etc.)
4. Address Proof (ration card, utility bills, Aadhar card, etc.)
5. Income Proof (salary slips, copy of Income Tax Return filed, etc.)
6. Passport-sized photograph(s)
7. Medical Reports (if required, as per the policy terms)

Providing these documents ensures a smooth and hassle-free purchase process for the chosen LIC Money Back plan, tailored to meet the individual’s financial needs and preferences.

Claim Process for Money Back Policy:

The claim process for LIC Money Back plans involves the following steps:

1. Intimation: The policyholder or nominee must intimate the company about the claim either through an online portal, SMS, or by visiting the LIC branch office.

2. Submission of Claim Form: Submit the duly filled claim form along with necessary documents at the LIC branch office that issued the policy at least 5-7 days before the policy’s maturity date.

3. Document Verification: The insurer will scrutinize the claim details and inform the claimant if any additional documents are required.

4. Claim Settlement: Once all the necessary documents are received and verified, the insurer settles the claim and credits the claim amount to the insured’s or claimant’s account using electronic transfer modes.

Documents Required to Process Claims:

For Maturity Claims:

  • Original policy document
  • Discharge Voucher (Form 3825)
  • NEFT Mandate Form
  • Self-Attested Photo ID proof and Address proof of the nominee (passport, Aadhar card, voter’s card, etc.)
  • A cancelled bank cheque or a copy of the policyholder’s bank passbook

Note: If the amount payable on maturity is Rs. 60,000 or less, the company releases the payment without calling for the policy document or discharge receipt, provided all premium dues are paid.

For Death Claims:

  • Death claim form (duly filled and signed)
  • Attested copy of death certificate issued by the local municipal authority
  • Original policy documents
  • ID proof of the beneficiary and age proof of the insured
  • Medical Certificate (Proof of the cause of death)
  • Police FIR (for unnatural deaths)
  • Postmortem report (for unnatural deaths)
  • Hospital certificate/records (in case the death was caused by an illness)
  • Employer certificate and cremation certificate (in case of early death)

These documents are essential to facilitate the smooth processing of claims for LIC Money Back plans and ensure timely settlement of benefits to the policyholder or nominee.

Advantages of Purchasing LIC’s Money Back Plans:

1. Survival Benefits: Money Back plans offer periodic payouts of a portion of the sum assured to the policyholder at regular intervals until maturity. This provides liquidity and meets financial needs at different stages of life.

2. Death Benefits: In the unfortunate event of the policyholder’s demise during the policy term, the nominee receives the death benefit, which includes the sum assured and any accrued bonuses. This ensures financial security for the family in case of untoward events.

3. Maturity Benefit: On the maturity of the money back policy, the insured receives the maturity benefit, which comprises the remaining sum assured and any accumulated reversionary bonuses announced by the company. This provides a lump sum payout at the end of the policy term.

4. Additional Benefits with Top-up Premium: Policyholders have the option to pay top-up premiums to enhance the basic plan benefits. They can add riders for additional coverage, providing comprehensive protection tailored to their specific needs.

5. Simple Reversionary Bonus: A simple reversionary bonus is paid to the policyholder at the end of the policy term or as a death benefit. It is accumulated over the policy term and based on the company’s performance.

6. Tax Benefits: Premiums paid on LIC’s Money Back Policy – 20 Years are tax-deductible under Section 80C of the Income Tax Act. Additionally, there is tax exemption on the claims received under Section 10 (10D) of the same act, making the plan tax-efficient.

7. Mode Discount: LIC’s Money Back Policy – 20 Years offers a mode discount for yearly and half-yearly premium payments. This encourages policyholders to opt for convenient premium payment modes while availing benefits.

LIC’s Money Back Plans provide a perfect blend of life insurance coverage, periodic payouts, and lump sum benefits, making them an attractive choice for individuals seeking financial protection and savings opportunities. The added advantages of tax benefits and optional riders further enhance the overall appeal of these plans to secure the future of policyholders and their families.


1. Can I avail a loan against my LIC Money Back policy?
Yes, most LIC Money Back policies offer the option to avail a loan against the policy’s surrender value after a specific period.

2. What is the policy term for LIC’s Money Back Plans?
The policy term for LIC’s Money Back Plans varies from 9 to 25 years, depending on the specific plan chosen.

3. Are the survival benefits received from Money Back plans taxable?
No, the survival benefits received from LIC’s Money Back plans are tax-free as per prevailing tax laws.

4. Can I surrender my LIC Money Back policy before maturity?
Yes, policyholders have the option to surrender their LIC Money Back policy before maturity. However, surrendering the policy may result in reduced benefits.

5. Can I enhance the coverage of my LIC Money Back policy with riders?
Yes, LIC Money Back policyholders can enhance their coverage by adding riders, such as accidental death benefit, critical illness benefit, etc., for additional protection.


LIC’s Money Back Plans offer a well-rounded solution that combines insurance protection and periodic payouts to policyholders. The plans provide the advantage of receiving survival benefits at regular intervals, ensuring financial support during various life stages. In the unfortunate event of the policyholder’s demise, the plans offer death benefits to the nominee, providing a safety net for the family’s financial security.

Moreover, these plans offer the flexibility to choose the policy term and the option to enhance coverage with riders. The tax benefits on premium payments and maturity proceeds make LIC’s Money Back Plans a tax-efficient investment option.

Before purchasing any plan, it is essential to carefully evaluate your financial goals and choose the most suitable LIC Money Back plan that aligns with your needs and preferences. Additionally, understanding the claim process and keeping the necessary documents in order can ensure a smooth and hassle-free experience in the event of making a claim.

In conclusion, LIC’s Money Back Plans provide a comprehensive and reliable approach to secure your future and safeguard your family’s financial well-being.

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