LIC agent commission on policies

LIC Agent Commission

Now we’ve all had an instance when some random guy might approach us to sell us some kind of insurance, well these people are the agents employed by LIC. So what exactly is a lic agent? LIC agents is a authorized sales marketing agent appointed by LIC of India for their plans and policies. LIC agents earn commissions on their sales. There are multiple other benefits also given to a LIC agent.

A lic agent is someone employed by LIC to sell their policies to the general populous, meaning they are paid for every policy you buy from them, well the payment they get is in form a commission which they get after every premium paid by the respective buyer of the policy and the percentage of the commission might vary with the type of policy sold.

Here is a list of commissions received by an lic agent as on March, 2020 based on the plan sold and different types of commission agent can get..

LIC Agent Commission Chart 2020

The new revised commission chart for 2020 is out. LIC of India revises it commission chart for agents every year. There are just a few minor changes this time in 2020 from the commissions of 2019. Download the commission chart 2020 here.

Types of commission

First commission Depends on the term and type of policy
First year policy Commission Payable on first year premium
Bonus Commission Subject to condition
Renewal Commission Depending on term of policy and the type of policy

 So as you can see the agent starts getting his or her commission as soon as you the buyer starts paying the premium.

LIC Commission

Whenever a policy is sold by LIC of India. LIC commissions are paid. These commission values are expenses that LIC pays to their network of agents and agencies to get policies sold. The LIC commissions can vary from 2% to almost 35% depending upon the policy and tenure. LIC agents commission in 2020 are out and you can see the percentages of commission against each policy (with table number) in above section.

What is LIC Merchant Portal?

Besides hiring and recruiting agents LIC also has another type of agency work that is called the LIC Merchant. All LC’s merchant work through a Merchant Portal to manage all their work and see their commissions and other earnings.

LIC Agent Commission Details

LIC agents get many benefits and the details of these commission are not just limited to cash but it also includes insurance, expenses, office maintenance, stationery purchase etc. There are many ways a LIC agent is paid commission is just one part of a agent’s total earnings. A agent gets many other benefits besides commission but yes all the benefits are basis the commission he / she earns. LIC policy commission attracts many other benefits for agents.

A agents gets the following commissions

  1. First premium commission
  2. Full premium term commissions
  3. Yearly bonus
  4. Club membership benefits

Commission based on type of policy

LIC agent commission rates depend on various things like policy table number, the term, etc.

Money Back plan

LIC Agent commission on money back policies in 2020

Premium Paying Term Commission
  1st Year 2nd and 3rd Year 4th Year Onwards
As per plan 15% 10% 6%
12 year 15% 8% 6%

source: plan money tax

 Endowment plan

LIC Agent commission on endowment policies in 2020

Premium Paying Term Commission
  1st Year 2nd & 3rd year 4th year Onwards
2 to 4 yr 5% 2.25% 2.25%
5  to 9 yr 10% 5% 5%
10 to 14 yr 20% 7.5% 5%
15 yr & above 25% 7.5% 5%

Source plan money tax

Term Plan

LIC Agent commission on term plans in 2020

Year Commission    
  First Year 2nd and 3rd year 4th year onwards
5 -9 years 10% 5% 5%
10 – 14 years 25% 7.50% 5%
15 years and above 25% 7.50% 5%

LIC Jeevan Labh Agent Comission

A agent gets 25% commission on LIC Jeevan Labh policy. This commission is for the first premium and then 2nd and 3rd year the commission is 7.5% and for 4th year onward till whenever the policy is in force the agents gets 5% commissions on premiums.

Source Plan Money Tax

 Pension Plan

LIC Agent commission on pension plans like Jeevan Shanti, Pradhan Mantri Vaya Vandana Yojana (PMVVY) in 2020

Premium Paying Term Commission
  First Year 2nd Year Onwards
2 to 4 year 5% 2%
More than 4 years 7.5% 2%

source: Plan Money Tax

LIC commissions have two slabs one is policies lower or equal to 14 years and then policies more than 15 years term.

The commission for policy term 14 is lesser than policies with term as 15 years or greater.


Continuing on the topic of commission the agent will continue getting the commission even if he or she leaves the job or even dies granted that the business he brought in continues. The maximum commission a LIC agent can get is 25%, so based on that lets take an example

Akshay has taken a term insurance with a yearly premium of 1 lakh rupees so by the chart

year Premium Commission Rate Commission
1st year 100000 25% 25000
2nd and3rd year 100000 7.5% 7500
4th year onwards 100000 5% 5000

Another important thing to note is that an agent will also get a bonus commission after he meets a simple requirement of 5 agency years and getting premiums of 5 lakh rupees this commission is about 40% of their commission (visit the link for a short story on LIC commission sharing)and is initially paid yearly but later after a certain period has passed becomes something the agent get monthly.

become-a-lic-agent Gurgaon

Should you buy a policy from an agent:

Well this a tough one the only options you’ve got are buying the policy via an agent or well you can buy a policy online, the latter most definitely is a cheaper option since all the commission do get out but is it the better one?

The answer to that are you ready and responsible to get all the premiums paid on time, while buying from an agent the agent is somewhat responsible for your premiums since his own commission is at stake therefore  he or she will definitely remind your upcoming payment, which might not sound like a big deal but with our busy lives we might often forget such things,

Next also comes apart in which if something were to go wrong you have some one who’s going to deal  with LIC which as many have experienced can be a real big hassle,  comparing that with having bought the policy from the life insurance agent he or she will be the one handling the problem amd all your safer from all the hassle.

That being said the premium paid for a policy online and via can agent can differ by as much as 25 to 30 % that’s most definitely a big difference  and you can save yourself a lot by buying policies online.

So at the end it comes to your personal preference do you want to save money or save yourself the trouble of dealing with a company like LIC  or any insurance  company for that matter, either way remember to invest smartly and keep your family informed about the policy, also if going to an agent make sure hi is reputed and has been in business for a while.

So concluding with the article and how you can become a lic agent?

To become a LIC agent all you need is the educational qualification of being 10th pass and you should be above 18 years of age if you meet the required criteria you can just go and contact the development officer at the nearest the LIC branch. YOU will then need to pass an interview conducted by the branch manager and if you clear the interview you will be sent for a training program for 25 days which will be followed by an exam, on clearing the exam you will get your appointment letter and ID card and you will be part of the development team.

Documents needed:

6 passport  size photos

Class 10 marksheets

Address proof: Voter ID, aadhar card, driving license amd coy of pan card.

So that concludes the overview on a LIC agent , hope you found something useful in the article and have a better understanding on this profession and their commission system. The LIC commission chart 2020 given above is taken from reliable sources and can be changed anytime without any prior intimation by LIC of India.

    Buy LIC policy in Gurgaon.

    Vikas is the founder of - an LIC life insurance agency based in Gurgaon. He has a experience of 16 years and is working with professionals, corporate and HNIs for their LIC services needs. Vikas is a MBA in marketing from Symbiosis, Pune and has a experience of 15 years working with companies at various levels. Vikas can be reached at 9891420503 and [email protected]

    34 thoughts on “LIC Agent Commission”

      1. The commission for Jeevan Umang is 25% for first year, 7.5% for next two years and then 5% for entire policy term.

      1. The commission for endowment 917 plan is 2%. For premium of Rupees 1,10,000 the agent would be getting 22,00 as commission.

          1. Yes. The commissions are paid till the end of the policy. Actually commission is paid every time a premium is paid for new policy or renewal.

    1. Please chart the main differences between plan 845 & the new plan 945, also bonus to agent , is it paid yearly? What are the conditions where bonus to an agent can be withheld after full.payment of the premium

      1. Difference between 845 and 945 is not in terms of premium or any conditions. 945 plan was launched as a revised plan as per IRDA guidelines. 845 and 945 are the same plans.

        No, bonus is paid only once for a new policy.

        There is no way the bonus can be withheld. If he agent qualifies for the bonus he / she will definitely be paid. To get bonus there are certain conditions that need to be filled like total number of policies done in a year, total premium collected, new policies done, etc.

        1. Once premium payment is stopped for any reason how be renewed, what’s the penalty & what is the loss due to stoppage of policy before completion or maturation, and how much will be refunded

    2. I am planning to take the agent exam, just wanted to check is there any targets for the agents ?
      If yes. could you please share the # ?

      1. Hi Lalu,

        You need to complete 6 proposals in year. Please share your city name idf you would like to know the details for the agent exam.


        1. The commissions come regularly for the entire policy term. First year it is maximum then reduced for 2nd, 3rd year and then remains the same for the rest of the policy term.

      1. If the agency is in force and your proposal for life insurance has been accepted you will receive your commission. No one can stop that.

    3. Please tell agent commission for fix deposit plan 917 if client sum assured near about 10 lakhs for 25 years

    4. Pingback: LIC Agent Commission. General Insurance Agent Gurgaon

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