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Have you ever heard of a loan in which there is no tension of paying EMI every month? If you want to arrange money in an emergency, then take advantage.


If you need to take a loan in an emergency, then there is a loan that is cheaper than a personal loan and there is no load of paying EMI every month. You can repay this loan according to your convenience.

When you suddenly need money in an emergency, the first thing people do is borrow money from their loved ones. But sometimes even if this does not work, then people either get by by breaking one of their policies or take the help of a personal loan. A personal loan does get your work done, but it is very expensive because due to coming in the category of unsecured loan, its interest rates are very high. At the same time, after taking it, a good EMI has to be paid every month.

But if you have taken a policy of LIC, then you can also get the option of taking a loan on that policy. A loan taken on LIC is usually cheaper than a personal loan, as well as repayment is also very easy. In this, you do not have the burden of paying EMI every month. You can repay it at your convenience. This does not end your savings and your need is also fulfilled. Know here about the loan facility available on LIC policy.

LIC Loan comes under the category of secured loan

The loan available on an LIC policy comes under the category of secured loan because the loan guarantee is your life insurance policy. In such a situation, there is no need for much paperwork and the loan is available quickly. The customer can get the loan amount in just a period of 3 to 5 days. One advantage of a loan on LIC is that you do not have to surrender your policy. In such a situation, the benefits you get from insurance do not end. This loan is cheaper than a personal loan, and there are no processing fees or hidden charges while taking it. In this way, there is a saving from the additional costs of the loan.

No load of paying EMI every month

If you take a loan on an LIC policy, then its repayment is quite easy. In this, the loan repayer gets a good amount of time because the loan period can be from a minimum of six months to the maturity of the insurance policy. In such a situation, the good thing for the customer is that there is no tension of paying EMI every month on this loan. As the money accumulates, you can pay accordingly. But one thing to keep in mind is that annual interest will keep getting added to it. If a customer settles the loan within the minimum period of 6 months, then he has to pay interest for the entire period of 6 months.

3 options to repay the loan

Repay the entire principal amount along with interest.

At the time of maturity of the insurance policy, settle the principal amount along with the claim amount. In this case, now you will have to pay only the interest amount.

Pay the interest amount annually and repay the principal amount in a different way.

Loan rules

Loan against insurance policy is available only against select policies such as traditional and endowment policies.

The loan amount is decided according to the surrender value. You can get a loan of up to 80 to 90 percent of the surrender value of the policy.

The interest rate of the loan policy depends on the profile of the policy holder. Usually it ranges from 10 to 12 percent.

While giving loan against the policy, the insurance company keeps your policy as collateral.

If the loan is not repaid or the outstanding loan amount exceeds the surrender value of the policy, the company has the right to terminate your policy.

If your insurance policy matures before you repay the loan, the insurance company can deduct the loan amount from your amount.

How to apply for a loan

You can apply both online and offline to get a loan against the policy. For offline, you will have to go to the LIC office and apply for a loan with KYC documents.

To apply online, register for LIC e-services. After this, log in to your account. After this, check whether you are eligible to get a loan to replace the insurance policy or not. If yes, then read the loan terms, conditions, interest rates etc. carefully. After this, submit the application and upload the KYC documents online.

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