9 replies on this article “Surrender or Continue the LIC Policy (PLan Table 75)”

1. Vikram says:

   November 4, 2016 at 11:51 am

   Dear Sir/Madam,
   I have a LIC money-back (75-20) policy (Table 20 – Term 20) with sum assured of 4 Lakhs.
   1st premium paid on Dec 2001 of Rs.25,092/- (annually). Last premium of Rs.25,092/- paid on Dec 2015.
   Till date 15 premiums paid for 15 yrs and 2 money-back of Rs.80,000/- each (20% of sum assured) received on Dec 2006 (5th yr) & Dec 2011 (10th yr). 3rd money-back (15th yr) of Rs.80,000/- is due this Dec 2016.
   If I surrender the policy on Jan 2017 after receiving the 3rd money-back (on Dec 2016) and year-end accumulated bonus (on Dec 2016) without paying the 16th premium (due on Dec 2016), how much will I loose ?
   Total Investment = Rs.25,092 x 15 = Rs.3,76,380/-
   Total Money-back = Rs.80,000 x 3 = Rs.2,40,000/-
   Vested Bonus accumulated till 2016 = Rs.2,60,000/- (approx)
   Please provide your suggestion if I surrender the policy on Jan 2017, how much will I loose (in figures) from maturity amount and bonus. Also can I stop paying premiums from 16th year till maturity on 21st year ?

   Thanks & Regards
   Vikram

   Reply
   1. Manish Chauhan says:

      November 5, 2016 at 9:30 pm

      Hi Vikram

      The best answer you can get only from the agent you invested through or just contact the company. The thing is your case is a bit personalised and other than company, no one can give accurate information

      Manish

      Reply
      1. Vikram says:

         November 6, 2016 at 2:35 pm

         Thanks Manish for your feedback !!

         Reply
2. akgc2 says:

   January 30, 2014 at 10:20 am

   Dear Divya
   As per article below my Manish there are some changes in the LIC policy from Jan-2014.
   Article also talks about the changes in Surrender value and for 4-7 Yrs premium paid policies it says the surrender value will be 50% of premium paid.

   In my case I have paid 10 premiums. May I know how much surrender value I will get ?

   http://jagoinvestor.dev.diginnovators.site/2013/09/5-major-changes-in-life-insurance-policies-from-oct-1-2013.html#comment-132349

   Reply
3. ashalanshu says:

   January 29, 2014 at 10:06 pm

   Dear Arun, surrender value and paid up value can be availed from LIC itself. Maturity value you can calculate on the basis of bonus declared in past.

   Thanks

   Ashal

   Reply
4. akgc2 says:

   January 29, 2014 at 9:58 pm

   I have paid 10 installments of Premium till Dec-2013 and 10 are pending. I do have enough life cover with Term Insurance Policies (1.5 Cr Plus).

   What I need is approx figures of the amount I will get

   1. At maturity on continuation of the policy
   2. At maturity if I stop premium payment making it paid up policy.
   3. Now itself if I surrender the policy.

   If I get these figures I can calculate which option be better in term of better returns among these three.

   Can any financial expert or LIC adviser in this forum help me to know these figures?

   Few unknown areas here are

   1. Amount of Loyalty Bonus at maturity

   2. Surrender Value after 10 premium are paid and teh current vested bonus reflected in policy is 1,81,500/-

   3. Maturity value of Policy if it is converted into Paid Up policy now (Where 10 premiums are paid and 10 are pending.)

   Policy is LIC Money Back Policy (20 years) with Plan Table as 75.

   Reply
5. ashalanshu says:

   January 29, 2014 at 8:08 pm

   Dear Arun, the current vested bonus ‘ll be reduced if you opt to paid up as your sum assured ‘ll be reduced from current one to the calculated one as per your paid 11 prem.

   In my personal opinion, as you have just received your 2nd money back in 2013, it’s advisable to get surrender value and invest elsewhere. here I assume you have adequate life insurance cover from Term covers.

   thanks

   Ashal

   Reply
6. akgc2 says:

   January 29, 2014 at 7:26 pm

   Hi Divya
   Does this Surrender Value formula apply to all the premium paid terms or its valid for 3 years paid premium. As per your formula I would receive only Rs. 62728/-

   From your experience could you please tell me what would be the maturity value for this policy.

   As per my calculation 40% of SA + 20 years Bonus @40 Rs per 1000 of SA + LA
   it comes 40%*5,00,000 + 20*40*(5,00,000/1000) + 10% of 5,00,000(Assuming LA as 10% of SA)
   = 2,00,000 + 4,00,000 + 50,000 = 6,50,000/-

   However if you have different numbers please let me know.

   Also could you please let me know what would be the Maturity value for Paid Up policy considering 10 annual pending premiums of Rs. 31364/-, Current Vested Bonus of Rs 1,81,500/- after 10 years.

   Regards
   Arun

   Reply
7. divya.advisor says:

   January 29, 2014 at 7:10 pm

   You are loosing lot of money on surrender.
   Rules for surrender value for policies before 1-JAN-2014:
   Guaranteed Surrender Value = 30% of all premiums paid – 1st year’s premium

   You can take the paid up option i.e stop payment and take all the money at end of term. You can contact the branch to view the accumulated bonus and conversion to paid up.
   Always remember PPF has a annual limit of 1 Lakh and returns from regular RDs are taxed.
   You can invest in a mutual fund SIP if you want after you stop payment. You should pick the right fund for a conservative investor a bluechip/indexed fund should be a good option

   Reply

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