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The Covid-19 pandemic has taught the importance of life insurance for everyone. Many citizens are now purchasing insurance policies. But unfortunately, a large number of these policies lapse every year due to failure to pay premium on time. But lapsed policies can be revived. Life Insurance Corporation of India (LIC), the country’s largest life insurance company, has launched a campaign to encourage policyholders to revive their lapsed policies. This special window will remain open until October 22, 2021.
Eligibility
According to Irdai guidelines, an insurance policy lapses when policyholders stop paying premium within the grace period. For premiums paid annually, half-yearly and quarterly, the grace period is 30 days. For monthly payment, it is 15 days. To revive a lapsed policy, one needs to pay the accumulated premiums with interest. In addition, GST on late fees will be charged as per rules.
Conditions
Under this special revival campaign of LIC, policies of eligible products can be revived within five years from the date of the first unpaid premium. In view of the prevailing circumstances, the insurer is also offering a concession in the late fee for all insurance policies except term assurance and high-risk plans. Eligible health and micro insurance plans also qualify for the concession.
Concessions will depend on the total premiums paid. But as per latest LIC offer, there are no concessions on medical requirements.
Concessions
Under this special campaign LIC is offering 20% concession on late fee for total receivable premium up to Rs 1 lakh although the maximum allowed concession limit is Rs 2,000. But the customers will get 25% concession in late fee for total receivable premium from Rs 1,00,001 to Rs 3,00,000, But the maximum concession amount will not exit the Rs 2,500 threshold.
On the other hand, the country’s largest insurer is offering 30% concession in late fee for total receivable premium from Rs 3,00,001 and above. In this case, the maximum concession amount is Rs 3,000.
Procedure
To revive a lapsed LIC policy under this special offer, policyholders can contact their agents. One can also download the revival form from the official website of LIC. The form has to be filled and submitted to the LIC office along with the pending premium amount with late fee.