As the eventuality and the mishap can occur to anyone at any point in life, having a life insurance plan is must have to deal with the uncertainties of life. A life insurance policy is the best way to secure the financial future of your loved ones even in your absence. As the purchase of a life insurance policy is very important in a similar way the renewal of its policy from time to time and the resurgence of expired policy is equally crucial. We can define revival as "resurrecting."
Renewal of the LIC policy
The resurgence of the LIC policy can be done under the following 5 different schemes: -
1. Ordinary Rebirth - Under this reinstatement policy the insurance holder can revive his expired life insurance policy by paying all unpaid premiums, including one-time interest. However, the policy holder can be requested for the declaration of good health and the medical report under form no-680.
2. Special renewal - under this scheme the date of commencement of the insurance holder can be changed and the insured can pay only a premium due according to his age during the revival. Special revival scheme can be used if the insured is unable to pay the premium in a lump sum. Under a special resurgence regime, the insured can request a medical report and declaration of good health under form no-680. There are certain conditions that must be fulfilled if the insured wants to revive the policy under special regime of resurgence. These conditions are as follows.
The special rebirth scheme can only be used on the entire policy tenure. The insured person can make special rebirth only within 3 years of the lapsación policy. Any salvage value should not be acquired under the policy. Therefore, the special reactivation option can be implemented within 3 years from the policy start date.
3. Installment Renewal - In the event that if the insured fails to pay the premium in lump sum and special revival, he / she can use the installment plan to revive his / her policy. Under a quota renewal scheme, the policy can be revived by paying the amount in the following ways.
In the annual premium mode the policy holder has to pay half of the annual premium. In the biannual mode of payment of the premium, the insured has to pay half of the annual premium. In premium payment mode quarterly payments, 2 quarterly payments must be paid by the insured. The insurance holder can pay a regular premium of 6 months under the monthly mode of payment of the premium.
The rest of the premium must be paid by the insured in equal installments within 2 years, along with the regular premium according to the policy tenure.
4. Survival Benefits Cum-Revival Scheme - Survival benefit scheme can be used to revive money-back policies. If, the expiration date of the survivorship benefit comes before the online for the renewal date, then the insured person can take advantage of the survival benefit to revive the policy. However, the policy holder will have to pay the excess amount in case the rebirth amount is more than the survival benefit. Likewise, if the amount of revival is less than the survival benefit, the remainder of the remaining amount is returned to the insured.
5. Loan Cum Revival Scheme - the insured person can also revive the policy by taking the policy loan if on the date of the policy's rebirth it acquires a redemption value. The insured will have to pay the additional amount in case there is any deficit in the amount of reactivation. If the loan amount is more than the renewal amount the additional amount will be paid to the insured person.
Why is the rebirth of the LIC insurance policy declining?
Suppose that if the policy holder who has a life insurance policy suffers a critical illness just before the expiration of the policy. In cases like this, if the policy of the insured person is not revived, then he / she may face many difficulties to buy any new policy.