Calculators LIC plans New Endowment Review
LIC New Endowment Plan (Plan 714) is the directly selling version of LIC's flagship regular-pay endowment, relaunched in October 2024 under revised IRDAI norms (replacing Plan 914). For a 30-year-old buying ₹5 lakh sum assured over 20 years, the annualised XIRR at current SRB of ₹42/₹1,000 SA/yr and FAB ≈ ₹70/₹1,000 SA at 20 yrs (rising sharply to ₹450 at 25 yrs) works out to approximately 5–6% — modestly ahead of a savings account, with maturity proceeds tax-free under §10(10D) and premiums qualifying for §80C. The seven-times annualised-premium death-benefit floor (down from 10× in the older 914) means the 10% SA rule for 10(10D) is easier to meet. Bonus rates are not contractually guaranteed.
A salaried 28–40 year old whose §80C bucket is not yet saturated by EPF and home-loan principal, who wants the simplest possible LIC contract — pay every year, get a lump sum at the end, no riders, no income streams, no post-maturity tail. The improved 2024 surrender mechanics (post one full premium year, SSV benchmarked to G-Sec + 50 bps) make it slightly more forgiving than the older Plan 914 if life intervenes.
Anyone whose dominant need is life cover — a term plan delivers 10–20× the cover at the same premium. Anyone who can hold an equity SIP for 15+ years — historic equity returns have beaten endowment XIRR by 3–6 percentage points after tax. Anyone who needs liquidity flexibility — the policy loan is available but capped, and surrender values stay below cumulative premiums for at least the first 5–7 years.
LIC may declare lower SRB in future years (the 2025 valuation already shows compression versus 2023). You may lapse in years 1–2 and lose 100% of premiums. You may surrender mid-term and recover 30–60% depending on year. The structural risk is buying a 20-year commitment with a 5-year horizon — do not let the agent talk you into a longer term than you genuinely intend to hold.
Our headline XIRR uses the middle premium-paying term (15 years against a 21-year policy term), excludes optional rider premiums from the cash-flow base, and assumes the latest declared simple reversionary bonus rate holds for the full term. Try other PPTs and bonus assumptions on the New Endowment calculator.
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