What is the surrender value of LIC policy after 5 years?

Asked by: Stanley Boyle  |  Last update: August 10, 2023
Score: 4.8/5 (47 votes)

Special Surrender Value
If in case, the insurance holder has paid premiums for more than 4 years and less than 5 years, then 90% of the complete maturity sum is provided. If the policyholder is paying premiums for more than 5 years, then he/she receives 100% of the sum assured (maturity amount).

What is the surrender value of LIC policy for 5 years?

If the policyholder has paid his/her premiums regularly for more than four years, but less than five years, 90% of the total maturity sum assured amount is provided by LIC. The policyholder receives 100% of the maturity sum assured if he/she has diligently paid premiums for more than five years.

How much I will get if I surrender my LIC policy?

According to the LIC brochure: Guaranteed Surrender Value = 30% X Total premiums paid. The first-year premiums and all the added premiums or premiums for accident benefit or the term rider are excluded from the same.

What happens if I surrender my LIC policy after 5 years?

Implications of LIC Policy Withdrawal After 5 Years

The contract between the insurer and insured is voided, the life-insurance element will cease to exist once the policyholder has surrendered their policy. Thus any benefits before available will no longer be valid.

How to surrender LIC policy after 5 years or before maturity?

The policyholder should visit the nearest branch of LIC and avail a surrender discharge voucher. The Surrender Discharge Voucher is called Form 5074. The form should be filled and submitted with the relevant documents. Once the form and the documents are submitted, the company would process the surrender of the policy.

How to get rid of LIC Policy? | Surrender LIC Policy | Surrender Value explained

41 related questions found

What happens if I stop paying LIC premium after 5 years?

If the policyholder has paid premiums for atleast 5 full years and subsequently discontinued paying premiums and in the event of death of the life assured within 12 months from the due date of first unpaid premium, the policy money will be paid in full after deducting the unpaid premiums, with interest upto date of the ...

When can I withdraw money from LIC?

As we have discussed above, that there is a minimum period i.e., of three years after which LIC policy can be surrendered. The minimum period is computed from the date the policy is purchased, and it also depends on the policy's tenure and the premium payment term (PPT).

What is lapsed without surrender value?

This means that in case the policyholder failed to pay regular premium amount to LIC and the policy lapsed before the term of 3 years, it would be considered lapsed without surrender value.

What is the final amount of LIC after maturity?

What is the final amount of LIC after maturity? At the expiration of the LIC policy, the policyholder might receive 40% of the initial sum assured along with different bonuses.

How can I surrender my LIC policy and get refund?

What Documents Would You Need?
  1. Details of your linked Bank Account.
  2. The original policy bond document.
  3. Your identity proof like PAN Card, Aadhar Card, Voter ID, or Driving license.
  4. LIC Policy Surrender Form No.5074.
  5. NEFT Form (In case you don't have the Surrender Form)

How much is surrender value?

guaranteed surrender value is determined by multiplying the total premiums paid by the surrender value factor (the percentage of total premiums paid). When the insurance is close to its maturity period, the surrender value factor will be close to up to100% of premiums paid.

Can you cancel life insurance and get money back?

You won't get a refund on your life insurance policy unless you cancel during the free look period, which usually lasts up to 30 days. Generally speaking, when you cancel a policy before the end of its term, you won't get a refund because you still had active coverage during the time you were paying for the policy.

What happens if I surrender my LIC policy after 8 years?

What do you get after LIC policy surrender? If you have continued your policy for 10 years, surrendering it will entitle you to a Guaranteed Surrender Value or Special Surrender Value. LIC calculates the both and pays whichever amount is higher at the time of surrender.

How much will I get if I surrender my LIC policy after 3 years?

Under the guaranteed surrender value, the policyholder can surrender their policy only after the completion of 3 years. This means that the premium has to be paid for a minimum period of 3 years. If you surrender after 3 years, the surrender value will be around 30% of the premiums paid till date.

What is the maturity value of LIC policy?

Maturity Amount of LIC Plans

The maturity amount is calculated by adding the sum assured, which is decided upon by the customer and the company at the time of purchasing the plan, the bonus amounts or profits received throughout the plan's tenure, and additional bonuses if mentioned by the Corporation.

Can we surrender LIC policy online?

You can Surrender LIC Life insurance policy online on our portal. Surrender value is the amount of premium refunded to the policyholder after a few years of premium payment.

How much money will I get if I surrender my LIC policy after 8 years?

How much money will I get if I surrender my LIC policy? A LIC policy can be surrendered after being in force for 3 years. Here, the surrender value received is equal to 30% of the total premiums paid excluding the paid premiums of the first year.

What is average rate of return in LIC?

The average return on investment for LIC over a period of ten years between 2005-2006 and 2014-2015 has been 6.7%. The average return on a ten-year bond has been 7.9%. The difference between the two returns is 120 basis points. In fact, the average rate of inflation between 2005-2006 and 2014-2015 was 8.85%.

Do we get money back in LIC?

Periodic payments are guaranteed under money back plans which are expressed as a percentage of the sum assured. Money back plans, therefore, provide liquidity during the policy tenure. They provide funds to the policyholder at specified intervals so that the policyholder can meet his financial requirements.

What is surrender value after 4 years?

Types of LIC Surrender Value After 4 years

If in case, the insurance holder has paid premiums for more than 4 years and less than 5 years, then 90% of the complete maturity sum is provided. If the policyholder is paying premiums for more than 5 years, then he/she receives 100% of the sum assured (maturity amount).

What is the difference between lapse and surrender?

difference between these two terms (see, e.g., Kuo et al., 2003; Gatzert et al., 2009). While lapse refers to the termination of policies without payout to policyholders, surrender usually indicates that a surrender value is paid out to the policyholder.

What is the difference between accumulated value and surrender value?

The accumulation value of an annuity is the overall value of the annuity. However, the cash surrender value differs from the accumulated value in that the amount available to withdraw from the policy is subject to a 10% surrender penalty.

What is the surrender value of LIC policy after 10 years?

If you have been paying premiums for 10 years or more, LIC declares a guaranteed surrender value factor. In this case, guaranteed surrender value will be equal to : (total premium paid multiplied by the guaranteed surrender value factor) plus (bonus multiplied by surrender value factor for bonus).

How can I convert my LIC policy to pay up?

How to Convert a LIC Policy to a Paid-Up Policy? Suppose your policy tenure is more than 10 years and you have paid premiums for more than 3 years. In that case, your policy becomes paid-up automatically if you stop paying the premiums.

When should you stop paying life insurance?

If your mortgage is paid in full, or your family's savings and supplemental income is large enough to keep up with payments, you could consider canceling your term-life coverage.