LIC Surrender Value After 4 Years

Life Insurance is a long-term assurance and there are some unfortunate and critical times when you might have to surrender the policy. In other words, this simply means the policy terminates before its maturity period. Thus, if you want to surrender your policy in the mid-tenure, you would receive a surrender value of the allocation of income and savings.

Read more
LIC Plans-
Buy LIC policy online hassle free
Tax saving under Sec 80C & 10(10D)^
Guaranteed maturity with life cover for securing family's future
Sovereign guarantee as per Sec 37 of LIC Act
LIC life insurance
We are rated~
rating
6.7 Crore
Registered Consumers
51
Insurance Partners
3.4 Crore
Policies Sold
Now Available on Policybazaar
Grow wealth through
100% Guaranteed Returns with LIC
+91
Secure
We don’t spam
View Plans
Please wait. We Are Processing..
Your personal information is secure with us
Plans available only for people of Indian origin By clicking on ''View Plans'' you, agreed to our Privacy Policy and Terms of use #For a 55 year on investment of 20Lacs Tax benefit is subject to changes in tax laws
Get Updates on WhatsApp
We are rated~
rating
6.7 Crore
Registered Consumers
51
Insurance Partners
3.4 Crore
Policies Sold

Moreover, the surrender charge also gets deducts from the sum, which varies from one policy to another. A minimum period is required to surrender the policy under LIC plans. So is it possible to receive the LIC surrender value after 4 years? Let's find out:

What is a Surrender Value?

Surrender value is the sum that life assured receives from the insurance company when he/she decides to terminate the availed policy before the maturity time. The primary reason to surrender the policy is the dissatisfaction with the features, benefits, and terms and conditions. A policyholder will only be able to surrender his/her policy after paying premiums for 3 years. On surrendering the policy, a certain amount of money is provided to the life assured by LIC. This sum of money is called the Surrender Value. Though as per the various researchers, surrendering of policies is not recommended because LIC Surrender value after 4 years is uniformly low.

What Are The Effects of Surrendering LIC policy?

There are some of the ways with which an insurance holder gets affected if he/she decides to surrender the policy. Here is a quick laydown:

  • As the contract between the insurance company and the policyholder is canceled in these cases, so the life coverage constituent doesn’t exist after the surrendering of the policy. Consequently, any benefits that were offered previously will be ceased.
  • You can get several tax benefits for a life insurance policy U/S 80C of the Income Tax Act, 1961. These tax benefits will also be revoked as the contract that exists between the insurer and the insured is closed.

Types of LIC Surrender Value After 4 years

Generally, there are two types of surrender values available in such cases:

  1. Special Surrender Value

    If the premiums have been paid diligently for 3 years but less than 4 years by the policyholder, then 80 percent of the complete sum assured amount (maturity benefit) is provided by LIC to the life assured. If in case, the insurance holder has paid premiums for more than 4 years and less than 5 years, then 90% of the complete maturity sum is provided. If the policyholder is paying premiums for more than 5 years, then he/she receives 100% of the sum assured (maturity amount).

  2. Guaranteed Surrender Value

    As it is stated above the policyholder is eligible to surrender the LIC policy after the completion of 3 years, providing the policy should also be in force for at least 3 years. The LIC surrender value is 30 percent of the paid premium amount. In this, the premium paid in 1st year of the policy and the premium paid towards term rider and accident benefits is not included.

Documents Required for Policy Surrender

The policyholder is required to submit the following documents at the time of surrendering the policy:

  • The original copy of the policy bond
  • Form No. 5074 i.e., LIC policy Surrender form
  • Canceled cheque from the policyholder’s registered bank
  • ID proofs such as Aadhar Card, PAN Card
  • Fill LIC NEFT Form, if form 5074 is not being used.


Drawbacks of Surrendering LIC policy

  • One of the main reasons to invest in life insurance is to protect the financial future of the policyholder’s family. This reason is crushed when the life assured surrenders the policy because at that time, the life cover is not available and he/she cannot avail of any of the benefits offered by the LIC.
  • If in case an insurance holder wishes to invest in the same policy after few years, then he/she is required to pay an additional premium amount. This is because the age of an individual is increased and the risk of death is also getting increased.
  • Based on the T & Cs of the LIC policy, the accrued bonus will be provided to the policyholder. However, surrendering policy results in a cessation of all the benefits and consequently, he/she will only receive a limited part of the money paid by him in the last few years.
  • LIC Surrender Value after 4 years is immediately canceled if the policyholder wants to surrender his/her policy before the completion of 3 years.

What is a Paid Up Value?

Any type of policy that has lapsed within the 3 years of buying it and for which premiums have been paid for about 3 years is called a paid-up policy. It is a reduced SA (Sum Assured) amount that was available at the time of buying the policy.

Paid-Up Value Vs Surrender Value 

Surrender Value After 4 years 

Paid-Up Policy 

The lump-sum amount is available instantly to the policyholder

In this, the policyholder does not receive the lump sum payment instantly

No compensation will be provided in case of maturity of the policy or the death of the life assured

Complete Paid Up value is provided in case of maturity of the policy or the death of the life assured

The policyholder is not eligible for any additional future bonus

The policyholder is not eligible for any additional future bonus

How to Calculate LIC Surrender Value After 4 years?

LIC Surrender value can be computed using a Surrender value calculator that helps you get the approximate figures of your Surrendered policy. You can calculate your LIC Surrender value immediately by providing some basic information about your policy.

Wrapping It Up!

It is generally not recommended to surrender the LIC policy, but if the need arises, one has to keep in mind that the minimum period to surrender the policy is 3 years. This simply means that a policyholder is required to hold his/her policy for a minimum period of 3 years, before surrendering it. Upon the surrendering of the policy, the company will provide you the accrued bonus along with the premium paid for that time.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
^Trad plans with a premium above 5 lakhs would be taxed as per applicable tax slabs post 31st march 2023
+Returns Since Inception of LIC Growth Fund
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ

LIC of India
LIC Plans
LIC Jeevan Utsav
LIC Jeevan Kiran
LIC Dhan Vriddhi
LIC Monthly Investment Plans
LIC Jeevan Azad
LIC 1 Crore Endowment Plans
LIC Jeevan Labh 1 Crore
LIC Crorepati Plan
LIC Dhan Varsha - Plan No. 866
LIC Pension Plus Plan
LIC New Jeevan Shanti
LIC Bima Ratna
LIC Group Plans
LIC Fixed Deposit Monthly Income Plan
LIC Savings Plans
LIC’s New Jeevan Anand
LIC New Jeevan Anand Plan 915
LIC's Saral Jeevan Bima
LIC's Dhan Rekha
LIC Jeevan Labh 836
LIC Jeevan Jyoti Bima Yojana
LIC Child Plans Single Premium
LIC Child Plan Fixed Deposit
LIC Jeevan Akshay VII
LIC Yearly Plan
LIC Bima Jyoti (Plan 860)
LIC’s New Bima Bachat Plan 916
LIC Bachat Plus Plan 861
LIC Policy for Girl Child in India
LIC Samriddhi Plus
LIC New Janaraksha Plan
LIC Nivesh Plus
LIC Policy for Women 2024
LIC Plans for 15 years
LIC Jeevan Shree
LIC Jeevan Chhaya
LIC Jeevan Vriddhi
LIC Jeevan Saathi
LIC Jeevan Rekha
LIC Jeevan Pramukh
LIC Jeevan Dhara
LIC Money Plus
LIC Micro Bachat Policy
LIC Endowment Plus Plan
LIC Endowment Assurance Policy
LIC Bhagya Lakshmi Plan
LIC Bima Diamond
LIC Anmol Jeevan
LIC Bima Shree (Plan No. 948)
LIC Jeevan Saathi Plus
LIC Jeevan Shiromani Plan
LIC Annuity Plans
LIC Jeevan Akshay VII Plan
LIC SIIP Plan (Plan no. 852) 2024
LIC Jeevan Umang Plan
LIC Jeevan Shanti Plan
LIC Online Premium Payment
LIC Jeevan Labh Policy-936
LIC Money Plus Plan
LIC Komal Jeevan Plan
LIC Jeevan Tarang Plan
LIC Bima Bachat Plan
LIC’s New Money Back Plan-25 years
LIC Money Back Plan 20 years
LIC Limited Premium Endowment Plan
LIC Jeevan Rakshak Plan
LIC New Jeevan Anand (Previously LIC Plan 149)
LIC New Endowment Plan
LIC Varishtha Pension Bima Yojana
LIC Investment Plans
LIC Pension Plans
Show More Plans
LIC Calculator
  • One time
  • Monthly
/ Year
Sensex has given 10% return from 2010 - 2020
You invest
You get
View plans
top
Close
Download the Policybazaar app
to manage all your insurance needs.
INSTALL