LIC Amritbaal Calculator: Plan 874 Child Education Guide
Securing a child's future higher education and career aspirations against rising educational inflation requires a guaranteed, risk-free financial savings plan. LIC Amritbaal (Plan No. 874) is a non-linked, non-participating, individual child endowment savings plan introduced by the Life Insurance Corporation of India (LIC). It features short **Limited Premium Paying Terms (5, 6, or 7 years)** and an unprecedented fixed **Guaranteed Addition rate of ₹80 per ₹1,000 Sum Assured per year** for the entire policy term.
Our free online LIC Amritbaal Calculator empowers parents, guardians, and financial planners to calculate exact premium installments, project total accrued Guaranteed Additions, compute final maturity corpus at age 18–25, and evaluate the Premium Waiver Benefit (PWB) Rider.
What is LIC Amritbaal (Plan 874)?
LIC Amritbaal is a flagship child endowment policy designed to build a large guaranteed corpus for higher education, college fees, or business startups:
- Short Premium Paying Terms (PPT): Pay premiums for only 5, 6, or 7 years, allowing parents to complete premium commitments early in the child's life.
- Industry-Leading Guaranteed Additions: Earn fixed contractual Guaranteed Additions of **₹80 per ₹1,000 Sum Assured** every policy year without any stock market risk.
- Flexible Policy Terms: Policy terms range from 10 to 25 years, aligning with your child's graduation or post-graduation age (18 to 25 years).
- Premium Waiver Benefit (PWB) Rider: Protects the child's education funding if the proposer (parent/guardian) passes away during the PPT.
Key Policy Eligibility Matrix
| Policy Parameter | Official LIC Guidelines (Plan 874) |
|---|---|
| Child Minimum Entry Age | 30 Days Completed |
| Child Maximum Entry Age | 13 Years (Near Birthday) |
| Child Minimum Maturity Age | 18 Years (Completed) |
| Child Maximum Maturity Age | 25 Years (Near Birthday) |
| Premium Paying Terms (PPT) | 5 Years, 6 Years, or 7 Years (or Single Pay) |
| Policy Term Range | 10 to 25 Years (Subject to max maturity age 25) |
| Minimum Basic Sum Assured | ₹2,00,000 (2 Lakhs) |
| Guaranteed Additions Rate | ₹80 per ₹1,000 Basic Sum Assured / year |
How Guaranteed Additions (GA) Accrue in Plan 874
The cornerstone of LIC Amritbaal is its high guaranteed return rate. Every year, LIC adds ₹80 for every ₹1,000 of Sum Assured directly to your child's policy fund:
| Policy Term | GA Rate per ₹1,000 SA / yr | Annual GA for ₹10 Lakhs SA | Total GA Accrued at Maturity |
|---|---|---|---|
| 10-Year Term | ₹80 per ₹1,000 SA | ₹80,000 / year | ₹8,00,000 (8 Lakhs) |
| 15-Year Term | ₹80 per ₹1,000 SA | ₹80,000 / year | ₹12,00,000 (12 Lakhs) |
| 20-Year Term | ₹80 per ₹1,000 SA | ₹80,000 / year | ₹16,00,000 (16 Lakhs) |
| 25-Year Term | ₹80 per ₹1,000 SA | ₹80,000 / year | ₹20,00,000 (20 Lakhs) |
How the LIC Amritbaal Calculator Works
The LIC Amritbaal Calculator computes premium installments and maturity payouts using exact actuarial parameters:
- Base Premium Calculation: Computes base rate based on child age, chosen PPT (5, 6, 7 yrs), and policy term.
- High Sum Assured Rebates: Applies high SA rebates (up to ₹9 per ₹1,000 SA for SA >= ₹10 Lakhs).
- GST Addition: Adds 4.5% GST in Year 1 and 2.25% in Year 2 onwards (1.8% for Single Pay).
- Maturity Corpus Projection: Adds Basic Sum Assured + Total Accrued Guaranteed Additions (₹80/1k SA × Term).
Worked Financial Example & Higher Education Fund
Consider a parent purchasing **₹10,00,000 (10 Lakhs) Sum Assured** for a **2-year-old child** under a **20-Year Policy Term** with a **7-Year Short PPT** (Child matures at age 22):
| Child Milestone / Policy Component | Financial Details & Maturity Projections |
|---|---|
| Child Entry Age & Maturity Age | Entry Age: 2 Years • Maturity Age: 22 Years |
| Premium Paying Term (PPT) | 7 Years Short Pay (Pay from Child Age 2 to Age 8 only) |
| Approx. Annual Premium (incl. GST) | ~₹1,18,000 / year |
| Total Premiums Paid (7 Yrs Outflow) | ₹8,26,000 (Approx ₹8.26 Lakhs) |
| Basic Sum Assured | ₹10,00,000 |
| Total Accrued Guaranteed Additions (20 Yrs @ ₹80/1k) | ₹16,00,000 |
| Final Guaranteed Maturity Corpus (Age 22) | ₹26,00,000 (26 Lakhs — Over 3.1x Total Premiums Paid!) |
Strategic Comparison: LIC Amritbaal (874) vs Traditional Child Plans
| Comparison Parameter | LIC Amritbaal (Plan 874) | Traditional Child Endowment Plans |
|---|---|---|
| Guaranteed Additions Rate | Fixed ₹80 per ₹1,000 SA / year | Variable Bonus (~₹40 to ₹45/1k SA) |
| Premium Paying Terms | Short Pay (5, 6, 7 Years) | Long Pay (Equal to Policy Term) |
| Market Risk | Zero Market Risk (100% Contractual) | Variable Participating Bonuses |
| Premium Waiver Benefit | PWB Rider Available | PWB Rider Available |
Tax Benefits under Section 80C & Section 10(10D)
- Section 80C Tax Deduction: Annual premiums paid qualify for tax deduction up to ₹1,50,000 per financial year.
- Section 10(10D) Tax-Free Maturity: The entire ₹26 Lakhs+ maturity corpus and death benefit proceeds are 100% tax-free.
How to Use the LIC Amritbaal Calculator
- Select Payment Option: Choose Limited Premium Pay (5, 6, 7 Yrs) or Single Premium Pay.
- Select Policy Term: Pick a term from 10 to 25 years.
- Set Child Entry Age: Input child age (0 to 13 years).
- Enter Basic Sum Assured: Specify sum assured (min ₹2,00,000).
- Select Cover Option & Frequency: Choose 7x/10x cover option and payment mode.
Frequently Asked Questions (FAQs)
What is LIC Amritbaal Plan 874?
LIC Amritbaal (Plan 874) is a non-linked, non-participating, individual child endowment savings plan. It is specifically designed to build a guaranteed higher education corpus for children, featuring short premium paying terms (5, 6, 7 years) and high Guaranteed Additions of ₹80 per ₹1,000 Sum Assured per year.
What Premium Payment Term (PPT) options are available?
Under Limited Premium Pay, policyholders can choose short PPTs of 5 Years, 6 Years, or 7 Years. Alternatively, a Single Premium one-time payment option is available.
How do Guaranteed Additions work in LIC Amritbaal?
Guaranteed Additions accrue at a fixed rate of ₹80 per ₹1,000 Basic Sum Assured per year from Year 1 to the end of the policy term, credited to the policy at the end of each policy year.
What entry ages for children and policy terms are allowed?
Child entry age ranges from 30 days completed up to 13 years (near birthday). Policy terms range from 10 to 25 years, with a minimum maturity age of 18 years and maximum maturity age of 25 years.
What is the Premium Waiver Benefit (PWB) Rider?
The PWB Rider protects the child's future. If the proposer (parent/guardian) passes away during the premium paying term, all future premiums are waived, and the policy remains fully active until maturity.
Are maturity returns under LIC Amritbaal tax-free?
Yes, maturity proceeds, death claim benefits, and accrued Guaranteed Additions are 100% tax-free under Section 10(10D) of the Income Tax Act.