When the policy is surrendered, the company pays the surrender value and the coverage is terminated. Usually, there is a minimum period after which the policy can be surrendered. This minimum period is calculated from the date the policy is bought. The period depends on the term of the policy and the premium paying term. The usual minimum period under different instances is as follows —. As stated earlier, when the policy is surrendered, the surrender value is paid. Guaranteed Surrender Value is the surrender value which is guaranteed under the plan.
This value is calculated using either of the following two formulas —. It depends on the policy year in which the policy is surrendered. The later the policyholder surrenders the policy the higher would be the GSV Factor. For instance, in a year policy, the GSV factor would be higher if the policy is surrendered in the 15th policy year than if the policy is surrendered in the 10th policy year.
Special Surrender Value is the surrender value which is calculated by the company depending on its performance. If the company is making profits in the past financial years, it can offer a higher surrender value than the Guaranteed Surrender Value.
If the policy is surrendered in later policy years, the factor would be higher and vice-versa. The following documents would be required if the policyholder wants to surrender the policy —. Moreover, the surrender value paid would be very low compared to the total premiums paid by the policyholder. The implications of surrendering a LIC policy are negative. The policyholder cannot enjoy coverage after the surrender and the surrender value is also very low.
So, to avoid surrendering the policy, the policyholder has another alternative. This alternative is to make the policy paid-up. A paid-up policy is one in which the premiums have been discontinued.
A limited or regular premium policy can be made paid-up if the premiums are discontinued but the policy is not surrendered. When the policy is made paid-up, the coverage does not stop. The policy continues to run until death or maturity at a reduced value. The death and maturity benefits are reduced and are called paid-up values. If the policy is a participating policy, future bonuses are not declared.
In case of death, the paid-up death benefit is paid. Alternatively, when the policy matures, the paid-up maturity benefit is paid. Similar to the minimum period applicable for surrendering the policy, there is a minimum period after which the policy can be made paid-up. Moreover, to make the policy paid-up, premiums must be paid over the minimum duration. The minimum duration is, usually, two or three policy years, depending on the term of the policy and the premium paying term.
If the policy is a participating policy which earns the bonus, the vested bonus earned before the policy was made paid-up is added to the paid-up value. In case your earlier policies do not have your date of birth incorporated and you do have a date of birth certificate issued by the competent authority, you may send an attested copy of the same to us, with a request to admit your age Click here to find out the certificates of age that LIC accepts.
Ensure that the nominees name is correctly incorporated in the policy bond. You may change the nomination in your policy any time during the lifetime of the policy In case you have not included the name of the nominee till now, please do not delay; inform us your nomination immediately. Kindly note that the change of nomination has to be done in the branch that services your policy. The nominee is the person to whom the insurance claim amounts would be payable, in case anything unfortunate within the purview of the policy conditions happens to you.
In case you are raising a loan against your policy from LIC or any other financial institution, your policy would have to be assigned to LIC or the financial institution.
When you assign the policy the title of the policy is shifted from your name to that of the institution. The policy would be reassigned to you on the repayment of the loan. A fresh nomination should be done after reassignment of the policy. Assignment of policies can be done even when a loan is not required or for some special purposes To learn more about assignment Click here.
Remember to pay your premium in time, even if our notices do not reach you. There may be a postal delay. LIC usually sends premium notices one month in advance to the due month of the premium.
The due months of the premium are given in front page of the Policy bond. In case you have not paid the premium within the due date there is still time for you to make the payments without payment of interest on the premium. This period is called the grace period. With the exception of some plans The grace period for policies where the premium payment mode is monthly is 15 days from the due date.
The grace period for policies where the premium payment mode is quarterly, half-yearly or yearly is one month but not less than30 days. Status of your policy indicates if your policy is in force or has lapsed due to non-payment of premium. It also provides other important information with respect to your policy, for your reference. The status of your policy is available at the branch that services your policies. It is also available through our Interactive Voice Response Systems in select cities Click here to find out if your city is covered.
In cities connected by our computerized networks the status will be available in any of the branches. Now the policy status of policies being serviced in the cities connected by network are also available through Internet Click here to register for these services.
In select cities online touch screen kiosks are also provided where you can view your policy status. If your policy has lapsed due to non-payment of premiums within the due date, the terms and conditions of the policy contract are rendered void, till you revive your policy. A lapsed policy has to be revived by payment of the accumulated premiums with interest as well as giving the health requirements as required.
Clickhere for knowing more about the revival procedure and the different types of revival allowed Always keep your policy in force to ensure that your family gets their financial protection assured by your policy. However certain concessions dependent on the term for which you have paid the premiums are available with the exception of some plans for claims concession.
Clickhere to know the concessions for delayed premium payment and for claims during the lapsed period. Many of our plans are of endowment type and you would be allowed to raise a loan against your policy should you require funds. You repay the loan with interest or continue paying the interest and allow the loan to be deducted at the time of the claim payments.
Further loans on policies are also allowed after deduction of earlier out standings Click here to find out more about loans on policies. This is the value which is the amount payable to you should you decide to discontinue the policy and encash the same from LIC. Surrender value is payable only after three full years premiums are paid to LIC. More over if it is a participating policy the Bonus get attached to it as per prevalent rules.
Surrender of policy is not recommended since the surrender value would always be proportionately low. Should you decide to go in for another insurance at this stage further insurance would be available to you at a much higher premium because your age would have advanced since taking out the earlier policy.
Therefore retention of earlier policies and continuation of all policies without allowing them to lapse is the best strategy for continuing life insurance protection. When your Survival Benefits For Money back policies or maturity benefits are due, we send intimations to you in advance.
However, if the survival benefit amount is less than or equal to Rs. If such intimations have not come to you before the due date kindly inform us so that we may take necessary action Click here to know about the claims procedure.
The information contained herein is only to guide you and does not purport to be binding on either party. The contractual implications of your policy will be subject to the terms and conditions of your proposal and the policy document issued to you. Do you smoke or chew tobacco? Yes No. Calculate Premium. Show More. Find the right insurance for you. Male Female. Mobile Number. Communicate on whatsapp.
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