1. What is a LIC Premium Calculator?

Definition: This calculator estimates the insurance premium based on the sum insured and premium rate.

Purpose: It helps insurance professionals and policyholders determine the premium amount for life insurance coverage.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( P \) — Premium amount (currency)
• \( S \) — Sum insured (currency)
• \( r \) — Premium rate (dimensionless)

Explanation: The sum insured is multiplied by the premium rate to calculate the total premium amount.

3. Importance of Premium Calculation

Details: Accurate premium calculation ensures proper insurance coverage and helps in financial planning for policyholders.

4. Using the Calculator

Tips: Enter the sum insured in USD and the premium rate (default 0.05 or 5%). All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: What is a typical premium rate?
A: Premium rates vary but often range from 1% to 5% of the sum insured depending on age, health, and policy type.

Q2: How is the sum insured determined?
A: It's based on the policyholder's needs, income replacement requirements, and insurance company guidelines.

Q3: Does this include taxes or additional fees?
A: No, this calculates base premium only. Additional charges may apply.

Q4: Can I use this for different currencies?
A: Yes, just ensure both sum insured and premium use the same currency.

Q5: How often is premium paid?
A: Typically annually, but this calculator shows the annual premium regardless of payment frequency.