In Indian culture, a daughter’s wedding is one of the most significant life events in a family. Parents start saving from the day their daughter is born to ensure she gets the best in life. But rising education costs, inflation, and unexpected events make it harder for middle-class families to manage long-term savings. That’s where the LIC Kanyadan Policy steps in.
Designed as a special combination of savings and insurance, this policy helps you plan your daughter’s future effectively. Whether you want to support her education, marriage, or provide financial stability, the LIC Kanyadan Policy offers a disciplined and secure way to build a strong financial foundation.
What is the LIC Kanyadan Policy?
Contrary to popular belief, the LIC Kanyadan Policy is not a separate policy by itself. It is a customized version of LIC’s Jeevan Lakshya Policy, tailored to support the needs of a father saving for his daughter’s future. This plan combines life insurance protection with guaranteed annual income and a maturity lump sum for your daughter’s future needs.
Only fathers can buy this plan, not the daughter herself. The policy includes a premium-paying term that is shorter than the actual policy term, and the payout is structured to align with important milestones in your daughter’s life.
Key Features of LIC Kanyadan Policy
Let’s break down the main features of the LIC Kanyadan Policy that make it attractive to many parents across India:
1. Dual Benefits: Savings + Protection
You don’t just save money under this plan—you also get life insurance coverage. If something unfortunate happens to the father during the policy term, the daughter’s financial goals remain secured.
2. Waiver of Premium on Death
One of the most powerful features is that if the father dies during the term, all future premiums are waived. LIC continues to pay the annual income to the daughter and a lump sum at maturity—without needing any further payments from the family.
3. Annual Income for the Daughter
After the death of the insured, LIC pays a fixed annual income of ₹10,000 per ₹1 lakh sum assured, every year till maturity. This can help cover education expenses or daily needs.
4. Lump Sum at Maturity
At the end of the policy term, your daughter will receive the total sum assured along with bonuses—ensuring that funds are available for her wedding or higher education.
5. Flexible Premium Payment Terms
You can choose to pay premiums for a shorter duration, say 13 years, while the policy continues for 25 years. This gives flexibility based on your financial planning.
6. Tax Benefits
Premiums paid are eligible for deduction under Section 80C, and the maturity amount is tax-free under Section 10(10D) of the Income Tax Act.
Eligibility Criteria for LIC Kanyadan Policy
Here are the basic eligibility requirements if you wish to opt for this plan:
| Criteria | Details |
| Entry Age of Father | 18 to 50 years |
| Daughter’s Minimum Age | 1 year |
| Policy Term | 13 to 25 years |
| Premium Paying Term | Policy Term – 3 years |
| Minimum Sum Assured | ₹1 Lakh |
| Maximum Sum Assured | No upper limit |
| Mode of Premium Payment | Monthly, Quarterly, Half-Yearly, Yearly |
This policy is ideal for parents who start early and want to build a solid corpus over a long duration.
How LIC Kanyadan Policy Works: Example for Better Understanding
Let’s take a practical example to understand how this policy works:
Mr. Sharma, aged 35, buys the LIC Kanyadan Policy for his 1-year-old daughter. He opts for a sum assured of ₹10 lakhs with a policy term of 20 years. The premium paying term is 17 years.
- Premium Paid: Let’s say he pays around ₹50,000 annually for 17 years.
- If Mr. Sharma Survives: He pays the premiums till year 17. In the 20th year, his daughter receives ₹10 lakhs + bonus (say ₹4 lakhs) = ₹14 lakhs.
- If Mr. Sharma Dies in Year 10:
- Future premiums are waived.
- His daughter receives ₹1 lakh every year till maturity (₹10,000 for each ₹1 lakh of sum assured).
- At maturity (20th year), she still receives ₹10 lakhs + bonus.
This structure ensures that even in the father’s absence, the daughter’s future is financially protected.
LIC Kanyadan Policy Bonus and Returns
Like most traditional LIC policies, the Kanyadan Plan also offers reversionary bonuses and final additional bonus at the time of maturity. These bonuses are declared by LIC every year and are added to the policy.
Types of Bonuses:
- Simple Reversionary Bonus: Declared annually and added to the sum assured.
- Final Additional Bonus: A one-time bonus paid at maturity, subject to LIC’s profits.
Though LIC policies are conservative in terms of returns, they offer guaranteed benefits, which is a big plus for risk-averse parents.
Benefits of LIC Kanyadan Policy for Indian Parents
Let’s look at why this plan is considered one of the best long-term savings tools for a daughter’s future:
1. Emotional Peace of Mind
Knowing that your daughter will not face financial stress, even if you’re not around, gives deep emotional security to any parent.
2. Disciplined Savings Habit
The structured premium payment encourages consistent savings over a long period, which is often difficult without such instruments.
3. Low Risk and Guaranteed Returns
LIC, being government-backed, is one of the most trusted financial institutions in India. The returns may be lower than market-linked products but are guaranteed and safe.
4. No Premium Stress After Demise
Families usually suffer financially after the death of a breadwinner. With the LIC Kanyadan Policy, that burden is lifted as premiums are waived and the benefits continue.
5. Supports Education, Marriage & Emergency Needs
The payout structure makes it ideal to support multiple milestones—college fees, higher studies abroad, or marriage expenses.
Points to Consider Before Buying
While LIC Kanyadan Policy has strong benefits, it’s essential to consider a few points:
- Returns are Conservative: If you’re looking for aggressive growth, mutual funds or SIPs might offer higher returns.
- Long-Term Commitment: You need to stay invested for 15-25 years, which may not suit everyone.
- Inflation Factor: Though safe, the returns may not always beat inflation in the long run. Diversify your investments accordingly.
However, if your main goal is security, not high risk, then this plan is among the best for a daughter’s long-term financial planning.
How to Buy LIC Kanyadan Policy
Buying the LIC Kanyadan Policy is quite easy. Here are the steps:
- Visit the Nearest LIC Branch or contact an LIC agent.
- Provide documents like ID proof, address proof, daughter’s birth certificate, and recent photographs.
- Decide on your policy term and sum assured.
- Fill out the proposal form and undergo a medical check-up if required.
- Submit your first premium and get the policy bond.
You can also begin the process online through LIC’s official website, although the final documentation may require an in-person visit.
LIC Kanyadan Policy vs Other Child Plans
Many private insurance companies offer child plans, but LIC stands out because of:
- Government backing and trust.
- Simplified structure and predictable benefits.
- No hidden charges or fund management fees.
- Better for low-risk investors.
For parents looking to build a secure, guaranteed fund without exposure to market volatility, LIC’s Kanyadan Policy remains a top choice.
Final Words: Is LIC Kanyadan Policy Worth It?
Absolutely—if you are a conservative investor with a long-term vision for your daughter’s future, this plan is ideal. It ensures protection, disciplined saving, guaranteed returns, and peace of mind—all in one.
In India, where traditions and responsibilities go hand in hand, planning for your daughter’s future is not just a financial goal—it’s a moral commitment. The LIC Kanyadan Policy helps you fulfil that commitment, even if life throws unexpected challenges your way.
