If you are also thinking of surrendering the policy, then first know the rules and regulations. The termination of the LIC policy in the middle is called surrendering the policy. You can surrender the LIC policy only after at least 3 years.
New Delhi . After Corona, there has been an increase in the surrender rate of LIC’s life insurance policy. According to a media report, in 2020-21, the rate of surrender of the policy has more than doubled compared to many earlier. If you are also thinking of surrendering the policy due to financial crisis, then first know the rules and regulations.
The termination of the LIC policy in the middle is called surrendering the policy. You can surrender the LIC policy only after at least 3 years. If you do it before 3 years then you will not get any money.
Surrender value
On surrendering the policy, you get the surrender value as per the rules of LIC. This means, if you decide to discontinue the policy or withdraw money from LIC, then the amount you get back equal to its value is called surrender value. If you have paid the premium of LIC for the full three years, then only you will be able to get the surrender value.
How much money back
Surrendering the policy incurs a lot of loss. If you have paid premium for 3 consecutive years then you are eligible for surrender value. After that you get only 30 per cent of the premium paid but excluding the premium for the first year. Meaning that the premium money you have paid in the first year also becomes zero. In this way, 30 percent will be available for the remaining two years. This does not include any additional premium paid for the riders, taxes and any bonus received from LIC.
LIC Surrender Form and NEFT Form are required to surrender the policy. Along with these forms, you have to attach a copy of your PAN card and original policy documents. Along with a hand written letter you have to explain why you are leaving the policy.
Who needs paper
1. Original Policy Bond Document
2. LIC Policy Surrender Form No. 5074. (Form can be downloaded).
3. Bank Account Details
4. LIC’s NEFT Form (if you are not using Surrender Form).
5. Original ID proof like Aadhar card, Driving license or PAN card.
