Asymmetrica Glossary

Final Additional Bonus (FAB)

Also called: FAB, terminal bonus

A one-time bonus paid only at maturity (or death after long tenure) on long-running participating policies.

Final Additional Bonus is a discretionary loyalty bonus that LIC and other insurers pay at maturity on policies that have run for a sufficient minimum term (typically 15+ years). It's expressed per ₹1,000 of Sum Assured and is meant to share in the longer-term investment surplus.

FAB rates are not declared annually — only the rate applicable to maturing policies in the current year is published. For LIC endowment plans, FAB has historically ranged from ₹100–₹600 per ₹1,000 SA depending on policy term and entry year.

Worked example

On a ₹5 L SA Jeevan Labh policy maturing after 21 years, an FAB of ₹200 per ₹1,000 SA contributes ₹1,00,000 to the maturity payout — meaningful but smaller than the Vested Bonus accumulated over the same period.

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