LIC Jeevan Saral and LIC New Jeevan Anand – surrender or paid-up?

LIC Insurance Forum – Questions & AnswersCategory: Endowment PlanLIC Jeevan Saral and LIC New Jeevan Anand – surrender or paid-up?
Rizwan asked 2 years ago

I have invested in some bad products which really doesn’t provide good insurance coverage I hold LIC Jeevan Saral & LIC New Jeevan Anand, Now that I have decided to go for a Term Plan+ SIP investments to gain maximum coverage to my family, But before taking any call I need your advice.

I am aged about 34 years and married, I have recently take a Home Loan of 32 lakhs for which EMI has already started but I know that Insurance products that I hold are definitely not covering my Home Loan Amount, So I need your valuable advice of you on my below insurance policies that I hold. Kindly advice what should be done with my bad investments that was made and how can I recover from any further loss.

Plan: Jeevan Saral
Sum Assured: 5,00,0000
date of Commencement: 26/12/2009
Policy Term:21 Yrs
Premium Amount:24,020

Scenario-1: I have paid premium for 7 years now, will I get my maturity amount along with Loyalty Bonus if I surrender my policy now or is that I get loyalty bonus only after premium payment for 10 years, If So If I am Surrendering my policy this year, How much will I get as Maturity Amount, Appreciate if you can calculate and let me know the exact figure

Scenario-2: If I Paid up my Policy instead of Surrendering, How much will be the insurance Coverage or Sum Assured, In paid up I think I will not get my money back but would like to know by how much amount will my insurance coverage gets reduced from 5 lakhs?

Scenario-3: If I partial withdraw after 10 yrs, How much amount will I get, Even after partial withdraw will my Sum Assured will be 5 Lakhs or will it be reduced, if reduced how much will be my premium amount?
I have inquired my Surrender amount for my Jeevan Saral policy with LIC, the surrender amount at present is 1,39,000. Amount that I have paid as premium from 7 years is 1,70,000, obviously here am in Loss, so is it better go for paid up else should I surrender undergoing Loss?

Plan: New Jeevan Anand
Sum Assured: 8,00,0000
date of Commencement: 28/08/2014
Policy Term: 21 Yrs
Premium Amount: 44,000

Querry: I have paid Premium for this policy for 2 years with Taxes I have paid 90,000 till date, I know that I will not get any amount If I surrender my policy now, since I have not fulfilled lock in period, Suppose If I Paid up my Policy instead of Surrendering after 3 yrs lock In, How much will be the insurance Coverage or Sum Assured will I have, will I get my money that I have paid for 3 years when policy term ends after 21 yrs along with the insurance coverage till 21 years? Kindly let me know if my understanding is correct. If not, Is it correct to go for paid up or surrender? Which will be correct decision?

I really appreciate if you could advice on the following:
1. What would be the maturity value if I continue with my LIC Jeevan Saral and LIC New Jeevan Anand policies?
2. What would be the surrender value if I surrender my Jeevan Saral policy now? I know that for New Jeevan Anand I will not get any money as I have paid only for 2 years but If Iam loosing huge amount of 88,000 if I am surrendering
3. What would be the paid-up value if I stop further payments on Jeevan Saral & what if I pay another premium for New Jeevan Anand and make it as Paid Up
4. Finally What would be your advice – surrender or paid-up?

Also I would like to know that if am surrendering my both the policies then the income tax benefit that I have claimed earlier for the premiums I have paid will be taxable as income if the policy is terminated?

1 Answers
Santanu Staff answered 2 years ago

Hi Rizwan,

I think the query is too big. But I would say the answer will be very simple.
The very first thing I would like to say you that, you have already done the investment and want to get max out them. In that case just remember you will get a return as per the performance of LIC policies only and that is 5-6% in long term.

If you have not invested for long so far, I think you can quit the policy and then surrender them. Although you may lose some money, but if you have a plan to put that investment in Mutual Funds or Equity to grow more then it may worth. But again, the cal should be yours as per your risk taking capability.

Think 10 times before investing anywhere.