Is LIC Jeevan Lakshya a good insurance policy?
- Mahesh Chokhawala
LIC Jeevan Lakshya is a traditional endowment insurance policy which comes with investment built into it. We do not recommend endowment policies for insurance purpose. You should keep your insurance need and investments separate. The only kind of life insurance that makes sense is term insurance because only in that case you are insuring purely against a risk. The moment you buy any other kind of insurance which promises a lumpsum repayment at the end of term, you are actually making an investment that is disguised as insurance. Such policies are expensive, provide you with little life cover, and the investment part offers moderate returns despite decades-long lock-in.
The way to go about it is to calculate how much cover you need and then find a good, low-cost, term insurance. The premiums for a term insurance will only be a fraction of the premium that you will pay for policies like Jeevan Lakshya.