Surrendering a life insurance policy with Life Insurance Corporation of India (LIC) requires the policyholder to submit specific documents to the insurance company. These documents are essential for verifying the identity of the policy holder, validating the surrender request and transferring the surrender value. Also, using the LIC Surrender Value Calculator will help policyholders calculate the surrender value of their policy before proceeding with the surrender. Learn more about the required documents and how to use the LIC Surrender Value Calculator.
Surrender Discharge Form
The Surrender Discharge Form, also known as Form 5074, is the primary document required to surrender a life insurance policy. This official document is issued by the insurance company and must be completed and signed by the policyholder. The form indicates the policyholder's intention to surrender the policy and initiates the surrender process.
NEFT Mandate Form
A NEFT (National Electronic Fund Transfer) mandate form is required to ensure seamless transfer of surrender value directly to the policyholder's bank account. This form authorizes the insurance company to deposit the surrender value into the designated bank account of the policyholder. It is important to fill this form correctly to avoid any problems during fund transfer.
Identification documents
Identification documents are required to verify the identity of the policyholder. Normally, a copy of the policy holder's PAN card and Aadhaar card (or other officially recognized identification documents) should be submitted. These documents help confirm that the person requesting the surrender is actually the policyholder.
Original policy document
The original life insurance policy document is a crucial requirement for surrendering the policy. This document serves as evidence of the Surrender Insurance Agreement. The policyholder should ensure that the original document is submitted to avoid delay in processing the surrender request.
Canceled cheques
A canceled check from the policyholder's bank account is required to provide accurate bank account details to the insurance company. This helps ensure that the surrender value is credited to the correct account. The check should be from the same account mentioned in the NEFT mandate form.
₹1 postage stamp
A nominal ₹1 postage stamp is required as part of the documentation process. This ensures that all necessary legal requirements are met.
Reasons for Surrender of Policy
Although not always mandatory, some insurance companies may request a written statement explaining the reason for surrendering the policy. This information will help the insurance company to understand the motivation of the policy holder and will be useful for their records. It may also help address any concerns the policyholder may have about their policy.
Submission to concerned branch
To streamline the surrender process, it is important to submit all the necessary documents at the branch where the policy was originally issued. This ensures that the surrender request is handled by the right office and processed efficiently. Indicate the relevant branch to submit the original LIC policy document.
LIC Surrender Value Calculator
Before surrendering a life insurance policy, it is beneficial to use the LIC Surrender Value Calculator to calculate the surrender value of the policy. This tool helps policyholders understand the financial implications of surrendering their policy. Let's see how to use the LIC Surrender Value Calculator :
Visit the LIC website: Go to the official LIC website and navigate to the Surrender Value Calculator section.
Enter Policy Details: Enter required details like policy number, sum assured, policy term and number of premiums paid.
Calculate Surrender Value: The calculator will process the information provided and provide the calculated surrender value based on the terms and conditions of the policy.
Surrendering a life insurance policy with LIC requires a detailed and systematic process. The necessary documents collectively enable the insurance company to process the surrender request, while ensuring compliance with regulatory requirements and protecting against fraudulent activity. Also, using the LIC Surrender Value Calculator will help policyholders take an informed decision by providing an estimate of the surrender value. By following these guidelines and submitting the required documents, policyholders can facilitate a smooth and efficient surrender of their life insurance policy.
