Question of surrendering 7 LIC policies

POSTED BY itspuneetsharma ON May 6, 2014 7:12 pm COMMENTS (5)

Hi Manish

I’m holding 11 endowment policies (7 premiums paid) & 1 Jeevan Saral (6 premiums paid). Details are as follows :

Plan-Term-D.O.C-Inst. Prem(Rs)-Sum Assured. :

14 – 20 -1 5/01/2008 – 2,957- 60,000

14 – 21 -1 5/01/2008 – 2,808- 60,000

14 – 22 -1 5/01/2008 – 2,451- 55,000

14 – 23 -1 5/01/2008 – 2,337- 55,000

14 – 24 -1 5/01/2008 – 2,082- 50,000

14 – 25 -1 5/01/2008 – 1,995- 50,000

14 – 26 -1 5/01/2008 – 1,915- 50,000

14 – 27 -1 5/01/2008 – 1,842- 50,000

14 – 28 -1 5/01/2008 – 1,777- 50,000

14 – 29 -1 5/01/2008 – 1,996- 60,000

14 – 30 -1 5/01/2008 – 1,926- 60,000

165 – 25 -17/01/2009 – 18,015- 375,000

Till date I have paid INR 1.68 lacs for these endowment policies and the surrender value is INR 1.02 lacs.

And surrender value for Jeevan Saral is INR 27 thousand against INR 1.08 (premium paid)

After deciding to surrender these policies, I happened to consult a senior LIC agent (other than the one who sold me these policies), who informed me that if I surrender these endowment policies after paying 10 annual premiums, I will atleast get back the total of all premiums paid till that time. Is it correct ? I have a doubt since , I could not find anything on the web related to this. Could you confirm please.

If it is true, and if I make my policies paid up right now, and surrender them after 10 years from D.O.C , will I get back the total of all premiums paid till date ?

Thanks.

5 replies on this article “Question of surrendering 7 LIC policies”

  1. Viren Phansalkar says:
    May 7, 2014 at 7:41 pm

    Oh, got it. Thanks.

    Reply
  2. ashalanshu says:
    May 7, 2014 at 10:45 am

    Dear Viren, the 10Y thing ‘ll depend upon the individual policy’s situation. Not a common thing.

    Thanks

    Ashal

    Reply
  3. ashalanshu says:
    May 7, 2014 at 8:38 am

    Dear Puneet, what about time value of money? The so called break even is not actually break even. How? After paying 3 more prem. you ‘ll get only prem. amount back. No return on it. Is it justified to continue? If you do have fear of loss, please do not surrender and let the policies run for full term. Please check this way. What’s the paid up value today for all these policies? How much can you get if you invest surrender value in a different product say FD or PPF or MFs? Compare the maturity value of surrender amount reinvested v/s paid up value.

    As usual, W’d you like to amputate a finger today or an arm tomorrow?

    Thanks

    Ashal

    Reply
    1. Viren Phansalkar says:
      May 7, 2014 at 10:18 am

      Ashal, is that 10 year thing true? Never heard of it.
      I agree that the concept is not at all break even.

      Reply
  4. Viren Phansalkar says:
    May 6, 2014 at 11:40 pm

    This is the first time I am hearing 10 year wala concept.
    Please check your policy document. I am sure it must not be there.

    Anyways, Hemant or Ashal will let us know if this is really true.

    Reply

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