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Revival Schemes for Lapsed LIC Insurance Policy

Published On May 02, 2021, Updated On May 03, 2021

A mishap or eventuality can happen to any person and at any time, therefore getting oneself insured under a life insurance plan is a must in order to deal with the unfortunate life events. It is the ideal way to secure the future of your dear ones even after your death. Apart from buying a life insurance plan, one must also remember to renew the insurance plan timely alongside revival of the lapsed insurance plan.

The need to revive the lapsed insurance policy arises when the policyholder fails to pay the premiums on-time or during the grace period. Due to the same, the insured is unable to avail the benefits of a life insurance plan. Generally, in order to reinstate the insurance plan, insurance providers need to offer a revival period of 2 years.

Schemes for Revival of LIC Policy

There are various ways to revive a lapsed LIC policy. Highlighted below are various schemes through which you can revive a lapsed LIC policy:

1. Special Revival Scheme

If the insured member is unable to make payment for the unpaid premium in the lump sum, then payment for the same can be done under the special revival scheme. Here, the intimation date of the insured member can be changed, and they can pay a single premium amount as per their age at the time of revival. Under this scheme, the insured is asked to submit Declaration of Good Health( Form no 680) and medical report.The conditions mentioned below must be fulfilled in order to revive a lapsed LIC  plan:

  • The plan can be revived just once during the plan tenure.
  • Special revival of policy can be done by the policyholder just within 3 years of lapsation of the plan.
  • This scheme can be used for plans, which should not acquire any surrender value. Within 3 years of the plan initiation date, the scheme needs to be availed by the insured.

2. Ordinary Revival

In ordinary revival policy, the revival of lapsed LIC policy can be done by the policyholder by means of paying all the premiums that are unpaid including the interest at once. However, the insured member needs to show a declaration of good health(form no-680) and medical report.

3. Instalment Revival

If the policyholder is unable to make payment for all the premium in lump sum and also does not meet the criteria for revival scheme, then they can make use of instalment revival scheme for their policy revival. Under this scheme, revival of plan can be done by paying in following ways:

  • Plans with yearly payment (half of annual premium)
  • In half year premium payment mode, the insured is required to pay one half of yearly premium.
  • In premium payment mode which is done on quarterly basis, two quarterly payments are needed to be made by the policyholder.
  • In monthly premium payment mode, the insured can pay a regular six monthly premium

While, the remaining unpaid premium has to be paid in installments during a 2 years tenure alongside regular policy premium.

4. Survival Benefit Scheme

The policyholder can renew money-back policies by using the survival benefit scheme. The following are the requirements to revive policy under survival benefit scheme:

  • Procedures for policy revival would be according to the terms and conditions that are valid from time to time, alongside the loan application.
  • Insured members are needed to provide survival benefit discharge form with self-consent in order to revive the plan.

5. Loan cum Revival Scheme

The policyholder can do revival of the policy by the means of taking loan on policy in case on the revival date, the policy acquires a surrender value. Any additional amount needs to be paid by the policyholder if there happens to be a deficit in the revival amount. In case the loan amount stands more than the revival amount, then the insured member would get paid an extra amount.

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Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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