If you have bought a LIC endowment or money back plan and looking to surrender it for cash value. Here is how you can surrender your LIC policy –
First Check – does your policy have a surrender value?
Check the policy bond and other documents if the policy has a surrender value.
All endowment or money back insurance plans accrue a surrender value after certain period. Generally insurance policies acquire surrender value after completion of three years of your policy. This surrender value will be very less compared to the premium you have already paid. Term insurance policies are pure protection plans and generally do not accrue any surrender value.
How to surrender LIC Policy?
Once you have decided to surrender your policy, here is how you go –
1. You need following documents –
– Original policy certificate
– Photocopy of premium payment receipts
– Photocopy of latest unit balance (for ULIPs)
– Application for surrender value (S.V. Application) or LIC Surrender Request Letter
– LIC Form No. 3510/5074
– Fill-in the above forms and affix the revenue stamp
2. Submit the application in your LIC office. You can only surrender your policy in the office where the policy is issued. You can find your policy issuing office in policy certificate or premium receipts.
3. Only policy holder can surrender the policy.
4. After verification of your policy details the LIC officer will issue you an acknowledgment receipt. Take the acknowledgement slip for your surrendered policies.
5. Once surrendered it would take approximately 20-30 days for you to receive the check at your address.
6. Surrender value cheque will only be sent to the address on your policy. If the address is not your current address, you may get it updated by giving address change request form. The address change will be done immediately and you will be given an acknowledgement.
Thinks to keep in mind, while surrendering insurance policy
1- Surrender value is payable only after three full annual premiums are paid to LIC.
2- Surrender of policy is not recommended since the surrender value would always be proportionately low.
3- Should you decide to go in for another insurance at this stage further insurance would be available to you at a much higher premium because your age would have advanced since taking out the earlier policy.