The Life Insurance Corporation of India (LIC) is one of the most prestigious insurance organizations that offers an extensive range of insurance policies and related services. Moreover, apart from being a life insurance policy that offers protection in case of any financial losses or unforeseen situations, the insurance policy can serve as collateral for taking loans. An insured receives the flexibility to take loans on endowment plans, whole-life plans, money-back plans, and pension plans. Helping individuals to avail of a loan on their insurance policy makes LIC a responsible company that offers the best services to its customers. Currently trading at ₹789, the LIC share price is a mark of its strength and strong belief of customers in its future possibilities:
Features:
1. Loan value:
The insured is allowed to take a loan on an LIC policy up to 90% of its surrender value.
2. Interest rates:
The interest rates are decided by LIC and are payable half yearly.
3. Loan tenure:
The loan tenure is 6 months from the date the insured receives the loan amount.
4. Loan repayment:
The principal loan is to be repaid as per the financial position of the insured individual.
5. Eligibility:
An insured individual with an active insurance policy paying regular premium payments is authorized to receive the loan amount against the policy.
Steps to apply for the loan:
1. Ascertain eligibility criteria and its fulfillment:
An applicant who wishes to apply for a loan against the insurance policy has to first check his or her eligibility. The individual has to verify whether or not his insurance policy is eligible for taking a loan. One can ascertain their eligibility by visiting his nearest LIC branch or the online LIC login portal.
2. Analyse the loan value:
One can easily ascertain the loan value depending upon the surrender value of their insurance policy. An easy online login on the official website of LIC can help individuals understand the best value they can receive for a loan amount against their insurance policy.
3. Submit loan application:
After receiving all the information, an online loan application has to be filled in and submitted either in physical or digital format. The loan against policy form has to be duly filled, signed and submitted along with the original copy of the insurance policy. A cancelled cheque along with other identification details and proofs must be submitted as well which include Aadhaar card, voter card or PAN card.
4. Approval and loan fulfilment:
After the form and necessary documents have been submitted, the LIC company opts for complete document and application scrutiny. The loan if approved is disbursed and deposited into the official bank account of the applicant.
5. Loan repayment and interest payment:
The loan amount must be repaid according to the financial situation of the applicant before the end of the loan tenure. Failure to pay the loan amount and interest payment lead to a deduction in the final maturity value. Moreover, one can opt for lump sum or EMI payments. An EMI calculator can be used to identify the EMI amount for principal and interest amount payments for convenient repayments.
Conclusion:
An insured individual can easily procure a loan against an insurance policy from LIC. Delivering financial protection, the LIC insurance policy offers twin benefits of financial security and access to a loan amount before its maturity.
