LIC New Endowment Plan (Plan 714): Contract Terms and Tax Position for Tax Year 2026-27

This article summarises the features of LIC's New Endowment Plan, Plan 714 (UIN 512N277V03), a participating, non-linked, individual savings-linked life policy, and the consequences under the Income-tax Act, 2025 and GST as on 10 October 2026. It describes the contract and does not recommend a purchase.

The plan is advised to a wide range of clients, and the two questions that arise most often are whether the maturity receipt is tax-free and whether GST is still being charged on the premium. Both depend on dates and facts that sit outside the sales literature, and the contract terms below are drawn from the insurer's brochure applicable from 22 September 2025.

Where the policyholder stands, situation by situation

On purchase

Entry age is 8 completed years minimum to 50 years maximum (age nearer birthday). Maturity age is 20 completed years minimum to 75 years maximum, and the term is 12 to 35 years. The age and term limits apply together, so the maximum maturity age can restrict the term; a proposer aged 50 cannot automatically choose 35 years.

The minimum basic sum assured is Rs 2,00,000. There is no product-level maximum, but underwriting and the prescribed multiples apply. Premiums may be paid yearly, half-yearly, quarterly or monthly, the monthly mode being through NACH, and some salary-deduction arrangements exist. The plan is sold through LIC's licensed offline channels, and health and occupation can affect acceptance and premium. For a minor life assured the contract vests in the life assured at the prescribed anniversary around age 18.

The plan is not market-linked. There is no NAV and no unit allocation, so it is not a ULIP. Only the basic sum assured and bonuses already vested are firm. Future bonus rates depend on the experience of the participating fund and are not guaranteed, and any projection is an estimate.

Optional riders are available for an additional premium and subject to eligibility: accidental death and disability, accident benefit, new term assurance, premium waiver and critical illness. The two accident riders are alternatives and cannot be combined. A rider is part of the cover only if it appears on the accepted schedule.

On death during the term

For an in-force policy, the death benefit is the Sum Assured on Death, plus vested Simple Reversionary Bonuses, plus a Final Additional Bonus if declared and payable.