LIC Withdrawal Online

The LIC, Life Insurance Corporation of India offers a wide range of life insurance plans ranging from term plans to savings and investment plans. These plans come with a variety of tenures so that an insurance seeker can select a type of coverage as per his/her requirements. Additionally, the policy runs with a chosen term for providing term insurance coverage.

Read more

LIC Withdrawal Online

The LIC, Life Insurance Corporation of India offers a wide range of life insurance plans ranging from term plans to savings and investment plans. These plans come with a variety of tenures so that an insurance seeker can select a type of coverage as per his/her requirements. Additionally, the policy runs with a chosen term for providing term insurance coverage.

Read more
LIC Plans-
Online Payment Service for all LIC customers
Multiple payment modes for the online payment
Hassle-free policy premium payment process
Instant payment acknowledgment
Lets Get LIC Payment Done
Pay your insurance premium online
Please wait. We Are Processing..
Your personal information is secure with us
Plans available only for people of Indian origin By clicking on "Continue" you agree to our Privacy Policy and Terms of use #For a 55 year on investment of 20Lacs #Discount offered by insurance company
Get Updates on WhatsApp
Scan the QR Code and be directed to our in-app Policy Renewal page
Scan the QR Code
Or Get the Payment Link on Mobile
Send Link
Please wait. We Are Processing..
Use our app to get started with your policy renewal
Please wait. We Are Processing..
A link has been sent on SMS and Whatsapp to make instant LIC premium payment through Policybazaar mobile app.

However, what if the life assured wants to withdraw or close LIC plans before the chosen term comes to an end? Can LIC withdrawal online is possible? The closing of the LIC policy is possible i.e. called surrendering. Here we will understand the surrendering of LIC policies and how it can be done smoothly: 

What is LIC Policy Surrender? 

Surrendering a LIC plan means withdrawing up or giving up the policy before the tenure of the policy is over. The life assured can choose to surrender the policy anytime that he/she wants to. In case of surrendering the policy, the company is required to pay the surrender value, and the life coverage is ended. 

When Can I Surrender the Policy? 

Policyholders sometimes think of surrendering their LIC policies when they are not satisfied with the terms and conditions, or features and benefits of the availed policy. A life assured is only able to surrender his/her LIC policy after having paid the premium for about 3 years. LIC provides a certain amount of money to the policyholder while withdrawing the policy online. This specific amount of money is surrender value. Though this option of surrendering LIC policy is not considered to be a suitable one as surrender value is considerably lower than the premiums paid. 

As we have discussed above, that there is a minimum period i.e., of three years after which LIC policy can be surrendered. The minimum period is computed from the date the policy is purchased, and it also depends on the policy's tenure and the premium payment term (PPT). There are different instances on which minimum period is determined: 

  • Single-Premium Policies – Under Single Premium policies, surrenders can be done from the 2nd year of the policy.  The policy cannot be surrendered in its 1st year. 
  • Limited and Regular Premium Policies – In this, the policy tenure is majorly taken into consideration. If the policy tenure is 10 years or below, the duration is 2 years. LIC withdrawal online can be done from 3rd year of the policy. The minimum duration is of 3 years in case of longer tenures such as for 10 years and above. 

Am I Eligible to Surrender LIC Policy? 

Generally, it is not suggested to surrender the policy offered by LIC but in case of need, one can only surrender the policy after 3 years. This simply means that you need to hold a plan till a required period i.e., a 3-year timeframe before surrendering it. After surrendering the LIC policy, the insurance company will offer you a certain amount of money called an accumulated bonus along with the premiums amounts paid for that particular time. 

What is Paid to the Policyholder in Case of Surrendering the LIC Policy? 

As stated above, once a policy is surrendered, the surrender value is paid to the policyholder. The surrender value of LIC is determined to be higher than the special surrender value or Guaranteed surrender value. What are these values? Let’s understand them in detail: 

  1. Guaranteed Surrender Value (GSV) – 

    Surrender value that is generated using the following formula: 

    GSV = [Total premium paid X GSV Factor] + [Accrued Bonus X GSV Factor]

    Always check the policy bond documents before purchasing the LIC policy as it is eligible for surrender value or not. This value is payable after the completion of three years. It is generally 30 percent of the paid premiums excluding the 1st premium amount and the premium paid for riders, taxes, and any type of bonus received from the insurer.

    The surrender value % depends on the policy term and year of the policy in which it is withdrawn. 

  2. Special Surrender Value –

    This is the value that is computed by the insurer depending on its performance. If the insurance company is making profits in the last few financial years, then the surrender value will be higher than the guaranteed surrender value. Like GSV, the SSV factor also increases with time. 

    If the life assured has paid his/her premiums on time for >3 years but <4 years, then 80 percent of the complete maturity amount is provided to the policyholder by LIC. If in case the policyholder has paid his/her premium for >4 years but <5 years, then 90 percent of the maturity amount is provided to the life assured. In addition to this, if he/she pays a premium for >5 years, then the policyholder receives 100 percent of the maturity amount. 

How To Surrender LIC Policy? 

For a smooth surrendering of LIC policy, follow the below steps: 

  • Visit the nearest LIC branch and avail a surrender discharge form. 
  • Submit the filled form along with the required documents. 
  • After submitting the form and documents, the insurer will process the surrendering of the LIC policy 
  • The surrender value will be provided to you when the request is approved by the insurer. 

Documents for Surrendering the Policy

  • Form 5074 – Surrender Discharge Voucher 
  • The original copy of the Policy bond 
  • Canceled Cheque from the bank of the insurance buyer 
  • Identification Proof such as Aadhar card, PAN Card, Driving license. 

Wrapping It Up!

If you choose to surrender the LIC policy, you can lose a lot of benefits provided by the insurer under the scheme. It is not recommended to surrender the policy but if the need arises, the minimum period for LIC withdrawal online is of three years. Therefore, holding the current policies and continuation of all plans without allowing them to lapse is one of the best criteria for continuing the policy. It is always advisable to read the terms and conditions, features and benefits before purchasing any policy.

Need guidance? Ask here
LIC Calculator
  • One time
  • Monthly
/ Year
Sensex has given 10% return from 2010 - 2020
You invest
You get
View plans

LIC of India articles

Recent Articles
Popular Articles
LIC Amritbaal

22 Feb 2024

LIC Amritbaal is a newly launched plan specially designed to
Read more
Benefits of LIC Jeevan Amar

13 Feb 2024

LIC Jeevan Amar is a term insurance policy offered by the LIC of
Read more
LIC Jeevan Azad Calculator

12 Feb 2024

LIC Jeevan Azad Calculator is an online tool that allows
Read more
LIC Index Plus

09 Feb 2024

LIC Index Plus is a new unit-linked life insurance plan
Read more
LIC Jeevan Dhara II-872

30 Jan 2024

LIC's Jeevan Dhara - II is an individual savings deferred
Read more
10 Best LIC Plans to Invest in 2024
Ever since its inception in 1956, LIC has been maintaining its stronghold in the Life Insurance domain with its
Read more
Surrendering LIC Policy Before Maturity Time: Your Guide!
The Life Insurance Corporation of India is one of the most prominent insurance companies. It has an unparalleled
Read more
How to Check the Maturity Amount of LIC Policies?
The LIC maturity value is the amount payable to the policyholder upon the completion of the policy term. LIC
Read more

Download the Policybazaar app
to manage all your insurance needs.