Life Insurance Corporation of India – LIC -has launched a special revival campaign to promote the revival of policies which has not acquired any paid up value. The period of the campaign will be from 17 – 7 – 2017 to 16 – 9 – 2017. Along with the conventional policies, which has not acquired paid up status, health insurance plans also can be revived through this campaign. LIC has offered special discounts for policies revived through this campaign.
Paid up policy – what does it mean ?
As this campaign is exclusively for policies which have not acquired any paid up value, let us get familiar with the terms like Paid up policy and Paid up value of a policy.
As far as conventional policies are concerned, policies where the premium has been paid for at least three full years acquires paid up status.
All the policies that have acquired a paid up status, stays intact until insured’s death or termination of the policy irrespective of further premium payment. But the risk cover offered shall be reduced to the tune of the value of the paid up policy. A paid up policy which has acquired the paid status will have a maturity value and can be surrendered for a cash value.
No need to add that, policies where the premium has not been paid for at least three full years, will not acquire any paid up value. The policy holder will neither receive any amount from the policy, nor will have any insurance coverage from it. So the great initiative from LIC to help the policy holder in reviving such policies has to be appreciated.
Special revival campaign – eligible policies
- Policies which are in lapsed condition without acquiring surrender value. (Policies issued prior to 01-01-2014 and to be revived within 5 years from first unpaid premium and policies issued after 01-01-2014 to be revived within 2 years of first unpaid premium.)
- Policies issued through all distribution channels will be eligible.
- Policies which are in lapsed condition and not completed policy term as on date of revival.
Special revival campaign – concession in late fee
|Total Receivable Premium Amount Under Policy||% of concession allowed in late fee per policy||Maximum amount of concession allowed per policy|
|up to Rs. 1,00,000||20 %||Rs. 1,500|
|From 1,00,001 to 3,00,000||25 %||Rs. 2,000|
|From 3,00,001 and above||30 %||Rs. 2,500|
How to calculate the amount required to revive your lapsed policy?
In order to revive your lapsed policy you will have to pay all the arrears of the premium along with the interest up to the date of revival. You can use the Revival and Late Fee Calculator to calculate the amount required to revive your lapsed policy.
Special revival campaign – Other conditions
- Concession in late fee will be allowed for Loan-cum-Revival also.
- Concession allowed only if arrears of premium with interest and revival requirements (if any) provided at the time of revival.
- Concession in late fee will not be allowed if the policy was revived in previous campaigns and has availed any discount.
- Plans where revival is possible without full payment of premium, (Plans 91,128,174 and 179) concession of late fee will not be provided if part payment is done.
Health requirements for reviving – Special Revival Campaign
All the health requirements as per the existing under writing rules will have to be submitted for reviving the policy. Satisfactory Declaration of Good Health (DGH), Medical reports and Special reports if any depending on the age and Sum to be revived has to be submitted.
Download forms required to revive policies.
Special conditions for revival of Health Insurance policies
- Policies under all types of Health Insurance Plans are allowed.
- Policies lapsed for a period less than two years from FUP will be eligible.
- For plans 901 and 902 – Only arrears of premium without any interest and without any evidence of health is required for revival.
- For plans 903 and 904 – interest concession will be available at the same rate as of conventional policies. Medical reports are to be submitted as per existing under writing rules.
Picture courtesy Freepik
Anish L J is a ‘Financial Planner’ and member of Chartered Insurance Institute(CII), London and Insurance Institute of India. He is also a finance, insurance and software consultant. He thoroughly follows the developments in finance, insurance, and other related sectors.