If you have missed the LIC premium within the due date there is still time for you to make the payments without payment of interest on the premium. This period is called the Grace Period. (with the exception of some plans).
1. The grace period for policies where the premium payment mode is quarterly, half-yearly or yearly is 30 days and 15 days when it is monthly. If the premium under a policy is not paid within the days of grace the policy lapses.
2. When the days of grace expire on a Sunday or a public holiday, the premium may be paid on the following working day to keep the policy in force.
3. If the policy has run for at least 3 years and subsequent premiums have not been paid, the policy shall not become void but instead, the sum assured will be reduced to an amount which will bear the same ratio to the original, as the number of premiums paid to the total number of premiums payable.
Revival Of Lapsed Policy
1. If the policy has lapsed, it can be revived during the life time of the life assured, within a period of five years from the date of the first unpaid premium but before the date of maturity subject to certain conditions.
2. The Corporation offers three convenient schemes of revival viz., Ordinary Revival, Special Revival and Installment Revival. Policies can also be revived under Loan-cum-Revival and SB-cum-Revival schemes.
3. If a revival of the policy is effected within 6 months from the due of first unpaid premium no personal statement regarding health is required and the policy is revived on collection of delayed premium plus interest.
4. Request for revival may be made to the Branch Office servicing the policy.
The policy can be revived within six months of the policy lapsation paying a small amount as the interest. A lapsed policy has to be revived by payment of the accumulated premiums with interest as well as giving the health requirements as required .
How the delayed payment interest is calculated?
LIC considers the delay of 1 month 14 days as one month. 1 month 15 days to 2 months 14 days as 2 months and like that. A delay of just 15 days will also be considered as a delay of one month. And the fine will be charged at the rate of 9.5%.
Example – An insured person has to pay a premium of Rs. 5000/- but he makes a delay of more than 2 months 14 days in paying the premium then the delay will be considered as a 3 months delay. Therefore the late fee he has to pay is Rs. 118.75/-. The total amount he has to pay is Rs. 5118.75.