Understanding LIC Exclusion

What Are Exclusions in LIC?

Exclusions in a policy are conditions or circumstances under which the insurer will not provide coverage. For LIC, these exclusions are outlined in the policy document and are essential to understand before finalizing any insurance plan. They define the boundaries of the coverage and protect the insurer from claims that arise under specific conditions.

What is the Common LIC Exclusion?

Suicide Clause: LIC policies have a suicide exclusion. If the policyholder dies by suicide within 12 months of buying or restarting the policy, LIC does not pay the full life cover. Instead, only a partial amount may be paid based on certain conditions.

• If suicide happens within 12 months of starting the policy, LIC will return 80% of the premiums paid (excluding taxes and extra charges), but only if the policy is active.

• If suicide happens within 12 months of restarting a lapsed policy, the company will pay the higher of 80% of the premiums paid or the policy's surrender value.

Understanding the Impact of LIC Exclusions

Exclusions are crucial for insurers to manage risk and keep premiums affordable for all policyholders. The insured must understand these exclusions to avoid surprises during a claim. Before purchasing a policy, reviewing the document carefully and clarifying any doubts with an LIC advisor is important.

How to Manage LIC Exclusions?

• Read the Policy Document Thoroughly: Always review the exclusions mentioned in the policy document to ensure you understand the terms and conditions related to coverage and exclusions.

• Seek Professional Advice: Consult with LIC advisors or insurance professionals to understand what is and isn’t covered. They can provide guidance based on your specific needs and circumstances.

• Consider Additional Coverage: For activities or conditions that may be excluded, consider riders or additional coverage options that might offer protection against those risks.

• Regularly Review Your Policy: As life circumstances change, regularly review your policy to ensure it continues to meet your needs. Make adjustments as necessary to ensure comprehensive coverage.

Wrapping It Up:

Understanding LIC exclusion is important in managing your LIC policy effectively. By being aware of what is excluded, you can make informed decisions, tailor your insurance coverage to your needs, and avoid possible issues during the claim settlement.