how to surrender policy

I do not want to pay premium of my policy

It is very important that you pay timely premiums for all your LIC policies. A premium for the policy is paid in advance for the term you have chosen which could be monthly, quarterly, half yearly or yearly. Though there are certain policies of LIC which have one time premium payment. You need not worry about these one time premium payment policies unless you want to surrender the policy.

Say, for some reason you do not want to pay the premium of your policy or are unable to pay dues to some financial constraints or some other reason. You still must consider paying the premium of your life insurance policy. A life cover is as important as the dearest thing like paying your child’s fees, or paying rent/EMI of your house.

When is it beneficial to surrender your LIC policy

It can never be beneficial to surrender a LIC policy though you can always work around to bear the minimum loss in terms of surrender value. Though the financial experts of the world believe any amount invested in life insurance is never wasted not even when you are surrendering a policy with zero surrender value. You can consult any financial consultant to understand why.

Every policy has its own terms and conditions which command the features of the policies, like surrender value. There are policies which can give you 100% surrender value even if it is surrender within the first year of policy commencement. On the other hand there are policies which give out zero returns whenever they are surrendered. 80 to 90% of policies have a good surrender value. If you have decided to surrender your policy consult your agent once and he would guide you on the best way to surrender the policy.

Recently a client of mine wanted to surrender a policy just because he could not understand what the policy features are. It is very important for the policy buyers to understand the policy details. Also make it point to reevaluate your insurance investment at least once a year.

Do not surrender your policy, you have these options you can go for

  1. Take a loan on the policy: all LIC policies have an option of loan. If you are tight on finances and are expecting the situation o improve in recent future, go for loan on policy. The loan process is instant and simple.
  2. Let the policy continue without life cover: mos of the policies come with a grace period of 1 month to 3 years within which the policy can be revived even if the premiums have not been paid.
  3. Surrender the policy after the lock in period. LIC policies can give out good surrender value after they have crossed the minimum lock in period. It may be beneficial for you to consider surrendering the policy at the right time.


There is no one size that fits all. Different policies have different conditions and each policy is different from other. If you are considering surrender of your policy do not do it before consulting your life insurance advisor.

Call one of our LIC agent, to understand when and how you can surrender a policy.

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