What is the difference between Surrender & Paid up??

POSTED BY BHAVANA ON January 14, 2012 3:15 pm COMMENTS (9)

I want to know the difference between surrender & Paid of lic policy??

Also what is the procedure for the both.

I have a jeevan saral policy 1000/mth completing 4 years.

What will be better surrender or paid up?

9 replies on this article “What is the difference between Surrender & Paid up??”

  1. Poornima gowda says:

    What is the difference between surrender value and paid up value with table

    1. Jagoinvestor says:

      Surrender value is the amount you will get TODAY , paid up value is the amount you will get in future.

  2. Gsatishkumar says:

    I want invest monthly 5000 in mutual fund or ulip for10 years suggest me what returns do iget

    1. YOu can expect 12% per year on an average in a long run !

  3. joydeep says:

    APART FROM ULIPs, ANY POLICY THAT HAS CONTINUED FOR 3 YRS, HAS ACQUIRED THE PAID UP POLICY STATUS, MEANING THAT 1. SEC 45 OF INSURANCE ACT, 1938 HAS BEEN REACHED. 2. THE POLICY CAN BE SURRENDERED. 3. LOAN CAN BE AVAILED FROM THE POLICY. 4. WITH PROFITS POLICIES WILL NOW PARTICIPATE IN BONUSES. 5. THE CLAIM CONCESSION FACILITY WILL BE CLAMPED FOR 6 MONTHS OR 1 YEAR.

    SURRENDER VALUE MEANS PAID UP VALUE + VESTED BONUSES ( IF ANY )

    AM I RIGHT LIC BAITER, MR ASHAL JAHAURI? YOU DO LOATHE LIC A LOT I SWEAR !!!!!!

  4. Anand says:

    Are you forgetting the major difference?

    Surrender – life cover is gone.

    Paid up – life cover continues.

    Or did I miss something?

  5. Dear Bhavana, if you compare right now, the paid up value ‘ll look higher than surrender value but do remember, once a paid up value is assigned, no more earning on that amount.

    In case of Surrender amount, the money is in your hand & you are free to invest it & earn more return from this amount if invested for a long term.

    Thus Surrender amount ‘ll give lower amount right now but higher amount later on due to reinvesting of the amount than paid up amount.

    Thanks

    Ashal

  6. BHAVANA says:

    Dear Ashal
    Thanx for the reply.
    want to know what is better paid up/surrender for the lic jeevan saral policy of 1000/mth premium paid for 4 years.
    where can i get more profit.

  7. Dear Bhavana, To convert either paid up or surrender, in both cases, you w’d have to contact the policy issue branch.

    In case of surrender, you immediately get the value assigned to your policy adjusted for surrender charges.

    In case of Paid up, your policy stop earning any more bonuses from LIC but the assigned paid up value is available to you only at the time of normal maturity or at the time of death claim to your nominees.

    Thanks

    Ashal

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