LIC market plus is a Unit linked Insurance policy in which the policy holder chooses to invest the funds in one of the 4 possible funds.
The 4 funds available are Bond Fund, Secured fund, Balanced fund and Growth fund, from least risk to high risk in that order.
Note that If your yearly premium value lies between Rs.5000 and 75000, 16.50% of the first year premium will go towards the charges (read processing charges) and the rest will be allocated towards buying the units as per the current NAV. From the second year onwards, 2.5% of the premium will go towards charges and the rest towards purchasing units.
If it is a single premium policy, a one time charge of 3.3% will be deducted from the premium amount.
LIC market plus NAV status
As on 20 June 2013, the NAV of 4 funds are as follows:
Market plus (181)
Bond fund: 18.1082
Secured fund: 16.8457
Balanced fund: 16.9614
Growth fund: 14.9238
Market plus I (191)
Bond fund: 15.0881
Secured fund: 12.8414
Balanced fund: 12.5376
Growth fund: 13.7399
LIC of India regularly updates the NAV values at its website.
As you may know, Market Plus policy was launched in 2006 and subsequently, Market Plus 1 was launched in 2008. At present, both these Unit Linked policies have been withdrawn by LIC. Depending on your premium, your deferment period may be any where between 5 and over 20 years. You can chose to continue with this policy or surrender your policy. Remember that although the policy is withdrawn, your life cover remains in full force till you continue paying your premium. As one may observed from the NAV’s, its not been such a staggering performance by these funds. The fact that Bonds fund has outperformed other equity friendly funds questions LIC’s choice of equity.
If you wish to discontinue (surrender) your market plus policy, you can do so by visiting your home branch with original policy bond. Assuming you have paid your premiums for atleast 3 years, you will get complete fund value (number of units in your account multiplied with the running NAV) in return. Just to remind you, depending on when you entered in to the policy, you may or may not get your complete investment back, since there will be quite a few allocation charges in the first few years.