1. Cancelling your policy before the maturity date is called surrendering your policy.
2. You will get the surrender value upon closing your policy.
3. You can use an LIC surrender value calculator to find this amount. It will be calculated if the premium is paid for three years in succession.
4. Closing your policy before three years will lead to zero surrender value.
5. No financial expert will ever tell you to surrender the policy since it will not give you any benefits.
1. It sometimes happens that people hurry through their policy or investment decisions and do not check the finer points carefully.
2. Sometimes they end up choosing policies which are not suitable for them or they wish to switch to investing in another policy which gives them higher benefits in turn.
1. The surrender value will be decided when you purchase the insurance plan.
2. Guaranteed Surrender Value is where you can surrender after paying premiums for three years. Your surrender value will be worked out at 30% of the premiums paid (excluding those paid in the first year and those paid for accidental benefits). This value will go up if you cancel the policy later on.
3. Special Surrender Value is another term that you should know. Suppose you stop paying your LIC premium after a certain period of time. Your policy will be active although the sum assured will come down. This is called the paid-up value. This is the actual sum assured (number of premiums paid/number of premiums payable).
4. Once the policy is closed before maturing, you will get the surrender value that will be higher than the guaranteed and special surrender value.
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