Yes, you can take a loan against your LIC policy. This is known as a policy loan. Policy loans are available on most endowment and money-back LIC policies.
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Terms and conditions for LIC policy loan
- The policy loan amount is typically up to 90% of the surrender value of the policy.
- The interest rate on policy loans is currently 9.5% per annum.
- The policy loan is repayable in monthly installments over a period of up to 5 years.
- If you fail to repay the policy loan and interest, your policy may lapse.
How to apply for an LIC policy loan
To apply for an LIC policy loan, you need to contact your LIC branch office. You will need to fill out an application form and provide your policy number and date of birth. You will also need to provide a copy of your PAN card.
Documents required for LIC policy loan application
- Policy loan application form
- PAN card
- Policy number
- Date of birth
Benefits of LIC policy loan
- Policy loans are available on most endowment and money-back LIC policies.
- Policy loans are a convenient way to get cash without having to sell your policy.
- Policy loans are typically available at a lower interest rate than other types of loans.
Drawbacks of LIC policy loan
- Policy loans can reduce the surrender value of your policy.
- If you fail to repay the policy loan and interest, your policy may lapse.
- Policy loans may not be available for all types of LIC policies.
Conclusion
LIC policy loans can be a convenient way to get cash without having to sell your policy. However, it is important to understand the terms and conditions of policy loans before applying for one. If you are considering applying for an LIC policy loan, I encourage you to consult with an LIC agent or financial advisor to get more information.
