New trouble for LIC policyholders: A new rule has been implemented for LIC policyholders. Those who already have an LIC policy must be aware of the latest decisions made by the Central Government.
New Rule for LIC Policyholders: Big Decision by the Central Government
A new rule has been implemented for LIC policyholders. Those who already have an LIC policy must be aware of the latest decisions made by the Central Government. LIC is now under a newly enforced regulation that brings significant benefits for investors. People often consider taking an LIC policy, and for those who already have one, this new rule is expected to offer even greater advantages.
A new rule has been introduced for LIC as well as other insurance companies. It specifically benefits those who are planning to surrender their policies. According to this rule, investors are likely to receive major benefits. The Insurance Regulatory and Development Authority of India (IRDAI) has made substantial changes to the rules related to surrender value, which will come into effect from October 2024. Under these new rules, policyholders will receive 20% to 30% more than before when they surrender their policy.
What is Surrender Value?
Surrender value is the amount paid by the insurance company when a customer decides to terminate their life insurance policy before its maturity. The surrender amount depends on how many years of premium the policyholder has paid and the type of insurance policy held.
LIC’s New Rule
IRDAI has introduced several important changes related to surrender value. From now on, Special Surrender Value (SSV) will be applicable to all endowment policies. This means that customers will now receive a higher amount when surrendering their policy.
Earlier, if someone surrendered their policy within the first two years, they would receive no refund. However, with the new rule, even if the policy is surrendered after just one year, a partial refund will be given.
