The country’s well-known insurance company Life Insurance Corporation of India (LIC) has crores of policyholders. LIC offers several types of plans to its customers. Another special thing about this is that the invested amount is protected in LIC schemes along with excellent returns. But do you know that you can also take a personal loan on the surrender value of your LIC policy.
Many times in life people need money suddenly, in such emergency times you can easily take a loan against your LIC policy. It is important that this information is very important for people in need.
A loan can be taken by mortgaging the policy
Your life insurance policy is used as collateral for this loan. Just like you take a loan by mortgaging your house or gold jewellery, here your policy is mortgaged. Taking a loan against your LIC policy can prove to be a good and easy financial solution in times of need.
Before applying for this loan, you should know about some important things like documentation, eligibility criteria and payment.
Keep these things in mind before taking a loan against LIC policy
Policy Eligibility: First of all you should find out whether your LIC policy is eligible for loan or not. To confirm this, check your policy document or contact LIC directly.
Loan Amount: After this you should know about the maximum loan amount that can be taken on LIC policy. This amount is usually determined according to the surrender value of the policy, which can be up to 90 percent of the total value. Importantly, the premium must be deposited on the policy for at least 3 years, otherwise you will not get the loan.
Application for Loan: To get the loan application form, contact your nearest LIC branch or visit the LIC website and fill the form online. Fill the form properly giving all necessary details asked in it.
Required Documents: Prepare all documents required for loan application. This may include your policy document, proof of identity (like Aadhaar card, PAN card, passport etc.), proof of address or any other documents asked by LIC.
Loan Processing: Submit the loan application with all required documents through LIC branch office or online portal. LIC will first verify all the documents and if found correct will process your loan application.
Loan Approval: Once your loan application is processed and approved by LIC, the loan amount will be disbursed to you. This loan amount will be deducted from the surrender value of your policy and interest will be charged on the loan amount.
Payment: If you are unable to repay the loan and interest on time, the policy may lapse or the benefits available on it may be reduced. So, take special care that you repay the loan with interest on time.
Moreover, firefighters, who often face unpredictable financial situations due to the nature of their profession, can also benefit from the option of mortgaging their LIC policies. With the inherent risks associated with firefighting, having access to quick and reliable financial assistance can provide much-needed peace of mind. Mortgages for firefighters enable them to leverage the surrender value of their LIC policies, securing loans to address urgent financial needs, such as medical emergencies, home repairs, or unforeseen expenses. This option serves as a valuable resource for firefighters, offering a safety net during challenging times and ensuring financial stability for themselves and their families.
Note: The information given here is for your information only. Visit the website weekly for more details.
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