LIC Bonus Rates 2025 – A Historic Change in Valuation Results
Every year, the Life Insurance Corporation of India (LIC) declares bonus rates for its participating policies after completing the annual actuarial valuation of its business. The bonus declaration is one of the most awaited events for policyholders and agents alike, as it directly enhances the returns on policies.
The Valuation of March 2025 has introduced some historic changes:
A new sum assured (SA)-based bonus slab has been introduced for most plans where SA ≥ ₹5 lakh.
In Jeevan Labh (Plan 736), there is an additional slab for SA ≥ ₹10 lakh.
Jeevan Umang (745) has seen the largest jump, with up to ₹2 per ₹1,000 SA extra for higher SA policies.
Combined with the removal of GST on insurance premiums, this year’s changes make LIC policies more attractive than ever.
In this article, we will explore not only the bonus rates but also explain the concepts behind them — valuation, types of bonuses, FAB, Loyalty Additions, and the difference between bonus and Guaranteed Additions (GA).
Table of Contents
What is Valuation?
Valuation is an actuarial exercise carried out every year by LIC to:
Assess the assets and liabilities of the Corporation.
Determine the surplus available for distribution among policyholders.
Declare bonus rates for participating policies.
The results of the valuation as on 31st March 2025 form the basis for the current bonus declarations.
Types of Bonuses Declared by LIC
Simple Reversionary Bonus (SRB):
The most common form of bonus.
Declared as a fixed amount per ₹1,000 Sum Assured.
Once declared, it becomes vested and guaranteed.
Interim Bonus:
Paid on policies maturing or resulting in death claims between two valuation dates.
Ensures fairness so that all policyholders benefit even if their policy exits mid-year.
Final Additional Bonus (FAB):
A one-time lump sum bonus added at maturity or death claim.
Rewards long-term policyholders.
Rates depend on policy term and Sum Assured.
Loyalty Additions (LA):
Declared on select plans (mostly newer or closed-ended plans).
- Paid as a one-time benefit at maturity, death, or surrender.
Linked to the overall performance and persistency of the plan.
Bonus vs Guaranteed Additions (GA)
Bonus:
Declared annually, depends on valuation surplus.
Not guaranteed in advance, though once declared it vests irrevocably.
Guaranteed Additions (GA):
Fixed rate promised in advance under certain non-participating plans (e.g., Bima Jyoti, Jeevan Umang GA years).
Independent of valuation surplus.
Key Difference: Bonus depends on LIC’s performance and policy participation, whereas GA is a contractual guarantee.
Types of Bonuses
Simple Reversionary Bonus (SRB):
Declared annually per ₹1,000 SA.
Once declared, it vests permanently.
Final Additional Bonus (FAB):
One-time addition at maturity or death, rewarding long-term policyholders.
Interim Bonus:
Applied when a policy exits between two valuations.
Loyalty Additions (LA):
One-time benefits declared on select plans.
Major Change in 2025 – SA-Based Bonus Slabs
New Slab at ₹5 lakh Sum Assured + Jeevan Labh Special
The 2025 valuation introduces a Sum Assured–based step-up that rewards higher covers with higher annual Simple Reversionary Bonus (SRB).
New Slab at ₹5 lakh (Most With-Profit Plans)
All major in-force participating plans now have higher bonus rates for policies with SA ≥ ₹5,00,000.
| Slab | Step-up | Meaning |
|---|---|---|
| SA < ₹5,00,000 | No change | Base SRB (per ₹1,000 SA) |
| SA ≥ ₹5,00,000 | +₹1 / ₹1,000 SA | Higher SRB every policy year |
Applies across popular with-profit plans (Endowment, Money-Back, Child, etc.).
Special for Jeevan Labh (Plan 736) — Three Slabs
| Slab | Step-up | Impact |
|---|---|---|
| SA < ₹5 lakh | — | Base SRB rate |
| ₹5–₹10 lakh | +₹1 / ₹1,000 SA | Higher SRB vs base |
| SA ≥ ₹10 lakh | +₹2 / ₹1,000 SA | Highest annual SRB accrual |
Source: Results_valuation_2025 (LIC Results of Valuation as at 31-03-2025). Declared SRB/FAB may vary in future valuations.
LIC Bonus Rates 2025 Explained
In this video, we break down the bonus rates declared by LIC of India for 2025 based on the March 2025 valuation. If you hold or are planning to buy an LIC policy, this update is important for you.
🔑 What you’ll learn in this video:
- What are with-profit plans and how profit sharing works
- Difference between Bonus, Final Additional Bonus (FAB) & Guaranteed Additions (GA)
- New ₹5 lakh Sum Assured slab — higher bonus (+₹1 per ₹1,000 SA) for most plans
- Special case of Jeevan Labh (Plan 736) with 3 slabs, including ≥₹10L (+₹2 per ₹1,000 SA)
- Big boost in Jeevan Umang (Plan 745) with up to +₹2 differences
- Illustrations of Jeevan Labh maturity under last year vs 2025 bonus rates
- Why this matters in today’s era of falling interest rates and repo rate cuts
⚠️ Disclaimer: Illustrations shown are based on LIC’s declared bonus rates as per March 2025 valuation. Future bonuses/FAB may change with subsequent valuations. Always check LIC’s official circulars or consult your agent for updated figures.
Bonus Rate Charts 2025
LIC Bonus 2025 — What exactly changed?
A new Sum Assured–based framework increases annual bonus accruals for higher cover sizes — and Jeevan Labh (736) adds a third, top slab.
New ₹5 lakh slab (most with-profit plans)
- Policies with SA ≥ ₹5,00,000 now get +₹1 per ₹1,000 SA higher Simple Reversionary Bonus (SRB).
- Applies across most in-force participating plans (endowment, money-back, child, etc.).
+₹1 per ₹1,000 ⇒ ₹1,000 extra each year
That’s ₹20,000–₹25,000 more SRB (before FAB)
Illustrative math; actual maturity also includes FAB and depends on future declarations.
Jeevan Labh (736): now three slabs
| Example (SA) | Step-up | Extra SRB / year |
|---|---|---|
| ₹10,00,000 | +₹1 | ₹1,000 / year |
| ₹10,00,000 | +₹2 | ₹2,000 / year |
Higher slab ⇒ higher SRB every year. Over long terms, the cumulative impact is significant.
Source: LIC Results of Valuation (March 2025). Bonus/FAB are declared annually and can vary in future valuations.
Slab Logic Across Plans — Quick Overview
Here’s how the new Sum Assured–based slab design works across participating plans in 2025. Bigger covers are rewarded with higher annual Simple Reversionary Bonus (SRB).
Most With-Profit Plans (Endowment / Money-Back / Child)
| Slab | Step-up | Meaning |
|---|---|---|
| SA < ₹5,00,000 | — | Base SRB rate |
| SA ≥ ₹5,00,000 | +₹1 / ₹1,000 SA | Higher SRB every policy year |
Covers popular plans: 714, 715, 717, 720/721, 732, 733, 734 etc.
Jeevan Labh (Plan 736) — Three Slabs
| Slab | Step-up | Meaning |
|---|---|---|
| < ₹5,00,000 | — | Base SRB |
| ₹5L–<₹10L | +₹1 / ₹1,000 SA | Higher SRB vs base |
| ≥ ₹10,00,000 | +₹2 / ₹1,000 SA | Highest SRB slab |
Biggest advantage for higher SA & longer term.
Jeevan Umang (Plan 745) — Two Slabs, Band-wise Gains
| Slab | Typical Step-up | Notes |
|---|---|---|
| SA < ₹5,00,000 | — | Base SRB (by PPT & band) |
| SA ≥ ₹5,00,000 | +₹1 / ₹1,000 SA | Most PPT/bands |
| Band-to-band effect | up to +₹2 | Seen in certain grids |
Detailed tables show PPT (15/20/25/30) × age bands. Gains strongest for ≥₹5L policies.
Source: LIC Results of Valuation (March 2025). Declared SRB/FAB may vary in future years.
1. Endowment Plans
Endowment Plans — Bonus Rate Charts (714, 715, 717, 733, 736)
Most with-profit endowments now have a new slab at SA ≥ ₹5,00,000 with +₹1 per ₹1,000 SA. Jeevan Labh (736) adds a third slab at SA ≥ ₹10,00,000 with a further step-up.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 12–15 | ₹35 | ₹36 |
| 16–20 | ₹39 | ₹40 |
| > 20 | ₹45 | ₹46 |
Note: +₹1 applies at SA ≥ ₹5L for each term band shown.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 15 | ₹38 | ₹39 |
| 16–20 | ₹42 | ₹43 |
| > 20 | ₹46 | ₹47 |
Note: Traditional endowment with lifelong cover after maturity; +₹1 applies at SA ≥ ₹5L.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 10–15 | ₹38 | ₹39 |
| 16–20 | ₹43 | ₹44 |
| > 20 | ₹48 | ₹49 |
Note: Participating single-premium plan; +₹1 at SA ≥ ₹5L. SRB vests as per SP rules.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 13–15 | ₹38 | ₹39 |
| 16–20 | ₹42 | ₹43 |
| > 20 | ₹46 | ₹47 |
Note: Income-protection oriented endowment; +₹1 at SA ≥ ₹5L across term bands.
Three-slab Structure (Base, +₹1, +₹2)
| Term | SA < 5L | 5L ≤ SA < 10L | SA ≥ 10L |
|---|---|---|---|
| 16 years | ₹40 | ₹41 | ₹42 |
| 21 years | ₹44 | ₹45 | ₹46 |
| 25 years | ₹47 | ₹48 | ₹49 |
Note: 736 rewards scale with SA; top slab (≥ ₹10L) gets +₹2 vs base.
Source: LIC Results of Valuation (March 2025). Bonus is per ₹1,000 Sum Assured per policy year; future declarations may vary. Final Additional Bonus (FAB) rules apply at exit for eligible durations.
Jeevan Umang (Plan 745) — Whole-Life Bonus Rate Chart
Whole-life participating plan with annual Simple Reversionary Bonus (SRB) and potential FAB at exit. 2025 introduces a Sum Assured slab where SA ≥ ₹5,00,000 typically earns a higher SRB.
SRB is per ₹1,000 Sum Assured per policy year. “NA” indicates not applicable for that PPT/band combo as per LIC table.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| PPT | SA < ₹5L | SA ≥ ₹5L | ||||||
|---|---|---|---|---|---|---|---|---|
| Up to 55 | 56–70 | 71–85 | 86+ | Up to 55 | 56–70 | 71–85 | 86+ | |
| 15 years | ₹49 | ₹58 | ₹65 | ₹74 | ₹50 | ₹59 | ₹66 | ₹75 |
| 20 years | ₹48 | ₹53 | ₹60 | ₹68 | ₹49 | ₹54 | ₹61 | ₹69 |
| 25 years | ₹47 | ₹48 | ₹54 | ₹63 | ₹48 | ₹49 | ₹55 | ₹64 |
| 30 years | NA | ₹47 | ₹48 | ₹58 | NA | ₹48 | ₹49 | ₹59 |
Note: In the 2025 grid, SA ≥ ₹5L typically gets +₹1 vs SA < ₹5L across most bands. Certain bands effectively show a +₹2 spread when compared over adjacent ranges, magnifying impact over long durations.
For SA ₹10,00,000:
- +₹1 per ₹1,000 SA ⇒ ₹1,000 extra per year in SRB.
- Over 25 years (accumulation), that’s ₹25,000 more SRB (before FAB).
Actual maturity depends on total SRB accrued for all eligible years, policy status, and FAB at exit as per LIC’s rules.
Source: LIC Results of Valuation (March 2025). Bonus/FAB are declared annually and can vary in future valuations.
Money-Back Plans — Bonus Rate Charts (720, 721, 732, 734)
Two-slab framework: SA < ₹5,00,000 (base) and SA ≥ ₹5,00,000 (+₹1). Tables below show the annual Simple Reversionary Bonus (SRB) declared per ₹1,000 SA.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 20 years | ₹36 | ₹37 |
| 25 years | ₹41 | ₹42 |
Note: Money-back plans pay periodic survival benefits; SRB continues to accrue on the full SA as per plan rules.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 13–15 years | ₹35 | ₹36 |
| 16–20 years | ₹39 | ₹40 |
| >20 years | ₹45 | ₹46 |
Note: For minor lives, risk commencement/vesting rules apply; bonus vesting follows LIC’s children plan provisions.
Two-slab Structure (SA < ₹5L vs SA ≥ ₹5L)
| Term | Bonus Rate SA < ₹5L | Bonus Rate SA ≥ ₹5L |
|---|---|---|
| 13–15 years | ₹35 | ₹36 |
| 16–20 years | ₹39 | ₹40 |
| >20 years | ₹45 | ₹46 |
Note: Tarun offers flexible survival benefit options; SRB accrual shown above applies by slab and term band.
Source: LIC Results of Valuation (March 2025). Bonus is per ₹1,000 Sum Assured per policy year; future declarations may vary. FAB (if applicable) is a one-time addition at exit per LIC rules.
Final Additional Bonus (FAB) – 2025
FAB continues to be payable on policies with 15 years completed.
Rates go as high as ₹3,550 per ₹1,000 SA for very long-term policies
Results_valuation_2025
FAB is payable only at maturity or death (not on surrender).
Final Additional Bonus (FAB) — Two Slabs
One-time addition at maturity/death (if eligible). Rates below are ₹ per ₹1,000 Sum Assured for standard endowment groups, shown by policy duration ladder.
FAB is not an annual bonus. Eligibility thresholds and groupwise rules apply as per LIC’s circular.
| Duration at Exit | FAB — SA < ₹2L | FAB — SA ≥ ₹2L |
|---|---|---|
| 15 years | ₹10 | ₹20 |
| 20 years | ₹40 | ₹70 |
| 25 years | ₹330 | ₹450 |
| 30 years | ₹900 | ₹1,100 |
| 35 years | ₹1,850 | ₹2,300 |
| 40+ years | ₹3,000 | ₹3,550 |
Illustrative for typical endowment groups (e.g., Groups 1/2/11/12/13). Money-back/special groups may have different FAB ladders; use a separate table if needed.
Source: LIC Results of Valuation (March 2025). FAB depends on policy status, duration, SA band, and plan group; future declarations can vary.
Loyalty Additions (LA)
Select plans like Jeevan Shree, Jeevan Saral, and newer close-ended plans get Loyalty Additions instead of FAB.
These are one-time enhancements, rewarding long-term persistency.
Loyalty Additions (LA) — 2025 (Single Column)
Values per ₹1,000 Sum Assured unless specified. Applies to exits during 01/01/2026–31/12/2026 as per LIC’s 2025 valuation.
LA by Term & Policy Year
| Year | 21 | 22 | 23 | 24 | 25 |
|---|---|---|---|---|---|
| 21 | ₹650 | ₹220 | ₹190 | ₹130 | ₹110 |
| 22 | – | ₹800 | ₹250 | ₹220 | ₹140 |
| 23 | – | – | ₹1000 | ₹270 | ₹240 |
| 24 | – | – | – | ₹1050 | ₹300 |
| 25 | – | – | – | – | ₹1100 |
Policy-year specific; dashes mean not applicable for that term.
LA by Term
| Term | LA |
|---|---|
| 12 yrs | ₹100 |
| 16 yrs | ₹110 |
| 20 yrs | ₹130 |
LA by Duration & Premium Band
| Yrs | Up to ₹5k | ₹5,001–20k | ₹20,001–50k | Above ₹50k |
|---|---|---|---|---|
| 10 | ₹300 | ₹360 | ₹425 | ₹475 |
| 15 | ₹465 | ₹525 | ₹605 | ₹655 |
| 20 | ₹670 | ₹750 | ₹840 | ₹930 |
| 24 | ₹800 | ₹900 | ₹1025 | ₹1200 |
Eligible on exit (maturity/death/surrender) after ≥10 yrs’ premiums.
LA by Duration
| Duration | LA |
|---|---|
| 20 yrs | ₹10 |
| 22 yrs | ₹20 |
| 25 yrs | ₹120 |
LA by Policy Year
| Year | LA |
|---|---|
| 7 | ₹40 |
| 10 | ₹65 |
| 15 | ₹140 |
| 19 | ₹185 |
LA by Variant
| Variant | Year | LA |
|---|---|---|
| 151-20 | 20 | ₹350 |
| 151-25 | 25 | ₹400 |
Source: LIC Results of Valuation (31-03-2025). Figures apply for exits during 2026. Future declarations may differ.
Repo Rate Cuts: Context for LIC’s Bonus Decision
Over the past year, the Reserve Bank of India (RBI) has reduced the repo rate multiple times, signalling a period of dwindling interest rates. In such an environment, LIC’s decision to reward policyholders with higher bonus slabs is a truly customer-friendly move, ensuring better returns even as market rates decline.
Conclusion
LIC’s 2025 bonus declaration is more than a routine exercise — it’s a policyholder-friendly reform. By rewarding higher Sum Assured policies, LIC is encouraging families to go for adequate insurance coverage while also offering better returns in an era of declining market interest rates.
For policyholders, this means:
Bigger policies = Bigger bonuses.
Long-term policies continue to reap the benefit of FAB and Loyalty Additions.
For agents and financial advisors, this is the perfect selling point: LIC continues to stand strong as the backbone of Indian insurance, offering security, stability, and growth to crores of families.
📖 Further Reading & Insights:
• For a broader perspective on household savings and taxation, check out FinMonkey’s article on whether GST cuts really make life cheaper .
• You can also revisit our earlier analysis of LIC Bonus Rates 2022–23 for historical comparison and to see how bonus declarations have evolved over the years.