Types of revival for lapsed LIC policies

Types of revival for lapsed LIC policies

LIC, Life Insurance

To keep the risk cover in force in your LIC policy a policyholder must pay his/her insurance premium on time or within the grace period. If a policyholder failed to do so then his policy became lapse, and no risk cover is available under that policy.

To restart the risk cover in the policy, a policyholder has to revive the policy by paying all the due premiums up to the date of revival.

Nowadays policies can be revived in other branches if the policy is to be revived on DGH and Medical Report only. If there is any special medical report is called for then policyholder has to visit his servicing branch to revive his/her policy. But sometimes it’s not possible for the customer to deposit all the due premiums to revive his/her policy, to make the revival process easy and convenient, LIC have different types of revival scheme so that customers can revive their policy to restart the risk cover.

Image Source: 100gardensgrow.com

Types of Revival Schemes in LIC

There are five types of  schemes are available in LIC of India. These are Ordinary Scheme, Special Scheme, SB cum Revival scheme, loan cum revival scheme and installment revival scheme.

Ordinary Revival Scheme

Its the simplest scheme of all, all you have to do is to visit your servicing branch, get the revive quotation from the branch and deposit all the due premiums in your policy with DGH (Declaration of Good Health) or special medical report wherever applicable as per age and sum to be revived.

Special Revival Scheme

Sometimes it is not possible to pay all the due premiums due to huge amount to revive policy, and policy holder do not want to loose the money he has already paid as premium in particular policy (Majority of the policies acquire paid up value after premium have been paid for full three years and 3 years completed in policy). For customer who’s policy have not acquired paid up value (Premium is not paid for 3 years) and policy is in lapsed condition for not less than 6 months and not more than 3 years (6 months < FUP > 3 years), the policy can be revived under Special Scheme.

Under this scheme Date of commencement can be increased up to 2 years of original date of commencement and

  • other requirements will be same as of ordinary scheme
  • the difference of new and old premium must be deposited with any due premium
  • Since DOC and maturity date will shift, consent of policyholder is required
  • endorsement fee of Rs. 50 and policy bond for endorsement is required
  • this type of revival can be done once in policy term
  • Policies under withdrawn plans can be revived under this scheme, even if the new date of commencement falls beyond the date of withdrawal of the plan provided the other conditions applicable for the scheme are satisfied.
  • Some policies are not allowed under this scheme.
  • For policies issued before 01/01/2014, a new date of commencement (DOC) should not be later than 31/12/2013. (As per LIC circular CO/CRM/1012/23 dated 17/03/2016)

As per the LIC of India circular CO/CRM/1012/23 dated 17/03/2016, Special Revival scheme is not available to new plans launched on or after 01/01/2014.

Loan-cum-Revival Scheme

Under this scheme, the policyholder can take the loan in his/her policy and that loan amount is adjusted in premiums. It is not necessary that your policy has acquired paid up value, even policy where paid up value is not acquired can be revived. The loan amount is calculated as if the policy is in force condition till the date of revival. Very useful scheme if the policyholder is not able to pay lump sum revival amount from his pocket at that time.

Survival Benefit cum Revival Scheme

The revival of money back policies can be allowed under ordinary revival by taking into account the amount of survival benefit that had fallen due. The policyholder has to submit usual revival requirements, S.B. discharge form and policy document.

This scheme is allowed for

  1. Survival benefit amount is more than revive amount and balance amount after utilizing amount for revivel is payable to policyholder
  2. Survival benefit amount is less than revival amount. However, shortfall amount will be required to be paid by policyholder

Revival By Installment Method

Under this scheme, the amount is spread over the next two year. Revivl under this scheme will be permitted-

  • for the policyholder who is not in a position to pay the arrears of premiums in one lump sum and policy cannot be revived under special scheme.where the arrears of premiums are for more than 1 year.
  • There is no loan outstanding under the policy at the time
  • No survival benefit falls due during the installment paying period of revivl
  • The arrears of premiums will be calculated in the usual manner as under ordinary scheme. Depending upon the mode of payment, life assured has to pay initially 6 Monthly premiums, 2 Quarterly premiums, 1 Half-premium , or ½ of Yearly premium. Balance of the arrears will be spread over in the remaining premium due date in current policy anniversary and two full policy anniversary thereafter

To download DGH (Declaration of Good Health) Form No. 680 Click Here

Anywhere revival of your lapsed LIC policy

Anywhere revival of your lapsed LIC policy

LIC, Life Insurance

Revival in very important process by which one can restart the risk cover in his/her lapsed policy by paying all the arrears of premium up to the date. But some times people are unable to revive their policy because, they are away from their servicing branch. This problem is mainly faced by service class people who have transferable jobs. To over come the problem faced by the policy holders, LIC of India in Feb, 2009 allowed the anywhere revival facility of some lapsed policies in any other branch through its circular CO/CRM/729/23 dated Feb 10, 2009. Policy coming under criteria mentioned below can be revived in any LIC branch in India.

Image Source: thehindubusinessline.com

Anywhere revival of lapsed policy without evidence of health with arrears of premium with interest

LIC policy holder can revive his/her policy in any branch of LIC if their policy fulfill any of these below mentioned criteria:

  • If premium in a policy have been paid for at least 5 years or more and revival is being done by paying arrears of premium with interest within 12 months from First unpaid premium(FUP) except few high risk plans like 94, 111, 150, 153, 164, 177 and 190. Policy holder must be 18 years or above on the date of revival.
  • Revival under pure endowment plan (21) and annuity plans like 96, 45, 116 and Jeevan Suraksha Plan 122 (without life cover)
  • Revival of policies during last 12 months before the date of maturity in endowment types of policies, except under money back policies
  • Revival of policy under free cover period under plans 87, 91, 128,192 if without Critical Illness (CI) rider.
  • Revival under auto cover period in plans 165, 17, 179, 184 and 185

Anywhere Revival of policies up to age 60 years on date of revival on basis of Declaration of Good Health (DGH) alone with arrears of premiums with interest

  • Anywhere revival of policies is allowed if done within 7th month of FUP and DGH received with 2 weeks after its called for(provided policy is issued on ordinary terms). If policy was earlier issued/revived with health/build extra then revival in other branch is not allowed.
  • Revival of polices between 12 months to 18 months from date of FUP provided premium have bee paid for 10 years or half of the term(whichever is more)
  • Revival of policies in last 12 months prior to the date of maturity in case of all type of money back plans.
  • Revival of endowment type of policies, if arrears of premium and interest is received with 12 to 24 months prior to date of maturity with satisfactory DGH.
  • Anywhere revival in these plans are not allowed: 88, 89, 94, 104, 105, 106, 107, 108, 109, 110, 111, 121, 129, 131, 133, 153, 160, 164, 177, 190 and plans with riders other than DAB.

Anywhere revival if policy docket images are available and can be seen in other branch

Revival of lapsed policy is allowed on the basis of full medical report (FMR) + DGH where other branch office are able to view images of policy docket. When other branch are able to see the original policy documents, then they can compare the measurements mentioned in proposal form with details in DGH and FMR submitted at the time of revival, thus able to revive the policy accurately with proper requirements and medical reports.

Anywhere Revival is not allowed under following cases

  • Anywhere revival is not available under term assurance plans like 94, 111, 150, 153, 164, 177, 190 and all the ULIP plans like 140, 172, 173, 180, 181, 187, 188, 191, 193 and 901.
  • Revival under any other scheme of revival like special revival, loan-cum-revival, SB-cum-revival, installment revival is not allowed.