There are crores of policyholders of Life Insurance Corporation of India (LIC), a well-known insurance company in the country. LIC offers many types of plans to its customers. Another special thing about this is that along with excellent returns in LIC scheme, the invested amount also remains safe.
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 suddenly need money, in such emergency times you can easily take a loan against your LIC policy.
You can take loan by mortgaging the policy
Your life insurance policy is used as collateral for this loan. Just as you take a loan by mortgaging your house or gold jewellery, similarly here your policy is mortgaged. Taking a loan against your LIC policy at the time of need can prove to be a good and easy financial solution.
Before applying for this loan, you should know about some important things like eligibility criteria, documentation and repayment. Today we will tell you about all the steps required to take a loan against LIC policy. If you have any questions regarding this, you can consult LIC officials or your financial advisor for guidance.
Check all these things before taking loan against LIC policy
Policy Eligibility: First of all, ensure whether your LIC policy is eligible to take a loan or not. Therefore, to confirm, check your policy document or contact LIC directly.
Loan Amount: Know the maximum loan amount on your LIC policy. This amount is generally decided according to the surrender value of the policy, which can be up to 90 percent of the total surrender value. But note that it is necessary to deposit premium on the policy for at least 3 years, otherwise you will not get the loan.
Loan Application: To get the loan application form, contact your nearest LIC branch or visit their official website and fill the online form. Fill the form correctly and provide all the necessary details asked in it.
Documentation: Prepare all the documents required for loan application. This may include your policy document, identification proof (like Aadhar card, PAN card, passport, etc.), address proof, and other documents asked by LIC.
Loan Processing: Submit the loan application along with all the 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 LIC approves it, 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.
Repayment: Repay the loan amount on time along with applicable interest as per LIC terms and conditions. If you are not able to repay the loan and interest on time, the policy may lapse or the benefits available on it may be reduced. Therefore, take special care that you repay the loan along with interest on time.
