LIC Jeevan Dhara 2 – Returns Calculation

LIC Jeevan Dhara 2 is a non-linked, non-participating, individual, deferred annuity plan. What are the returns being generated under the LIC Dhara 2 plan – Let’s find out.

A deferred annuity or pension plan is typically divided in 2 phases:

1. Deferment Phase (Accumulation Period)
2. Annuity Phase (Income Period)

Let’s understand this better with the help of a couple of examples.

LIC Jeevan Dhara 2 – Example

Option 2- Life annuity with Return of Premium for Single Life

In the above case, an annuitant aged 45 years chose to invest in Option 2 of the Jeevan Dhara Plan with a Regular Annual Instalment of ₹50,000 (excluding taxes), deposited for a period of 15 years. Here 15 years is the accumulation phase as well as the Deferment period.

Now, after the completion of Deferment period, the annuitant will start receiving an annual pension or annuity of ₹86,740. This will continue either till the annuitant’s age reaches 101 or till his/her death – whichever is sooner.

The below picture showcases how the cashflow statement would look like.

Let’s assume that annuitant passes away after 20 years into the Income Period i.e. 35 years after the plan start date. At that point, for the above case, the nominee will receive the Death benefit of ₹7.5 Lakh (₹50,000 x 15) and the policy will end.