LIC Policy: Usually people take loans to fulfill their financial needs. Due to its high interest rates, difficulties are faced in paying the loan. In such a situation, you can also take a loan on the policy of Life Insurance Corporation of India. There is no hassle of much paperwork in this.
LIC Policy: When there is a sudden need of money, people usually look for a credit card or personal loan. Meanwhile, many people also have some policy of Life Insurance Corporation of India (LIC). In such a situation, very few people know that loan is also available on LIC policy. This loan is much cheaper than other loans. There is no special pressure of EMI in this. Due to easy process, low interest and flexible repayment option, this loan can prove to be a big help in difficult times. Let us know the complete information about this special loan.
Life Insurance Corporation of India (LIC) is the largest insurance company in the country. LIC provides loan facility on all its policies. If you have a LIC policy and a loan facility is available on it, then you can arrange money by taking that loan in difficult times. This loan does not require much paperwork and the customer can get the loan amount in just 3 to 5 days.
No processing fees or hidden charges
One advantage of a loan on LIC is that you do not have to surrender your policy. In this case, you do not lose the benefits of insurance. Apart from this, this loan is cheaper than a personal loan. Along with this, there are no processing fees or hidden charges while taking it. In this case, one can save on additional costs of the loan. Usually, a loan on LIC is available at an interest rate of 9% to 11%, while the interest rate on a personal loan can range from 10.30% to 16.99%.
There is no hassle of EMI
There is no fixed system for paying EMI in this loan. The minimum loan period is 6 months and the maximum period can be till the maturity of the policy. Customers can make repayment as per their convenience. However, keep in mind that interest keeps getting added every year. Even if you repay the loan before 6 months, you still have to pay interest for 6 months.
How much loan will I get?
The amount of this loan depends on the surrender value of your policy. You can get a loan of 80% to 90% of the surrender value. This loan is secured, that is, LIC keeps your policy mortgaged. If the loan is not repaid on time and the outstanding amount exceeds the surrender value, then LIC can cancel your policy. On the other hand, if your insurance policy matures before repaying the loan, then the insurance company can deduct the loan amount from your amount.
There are three options available to repay the loan
In this, the loan can be repaid in three ways. First way – Repay the entire principal amount along with interest. Second way – Settle the principal amount along with the claim amount at the time of maturity of the insurance policy. In this case, now you will have to pay only the interest amount. Third way – Pay the interest amount annually and repay the principal amount in a different way.
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