LIC Premium: Don't have money to pay your LIC premium? Your PF account can help, here's how..

Often, money becomes tight at the end of the month. As the due date for paying your Life Insurance Corporation of India (LIC) policy approaches, stress is inevitable. Often, due to a lack of funds, people let their policies lapse, jeopardizing both years of savings and the security of insurance. However, if you are employed and have an Employees' Provident Fund (EPF) account, you need not worry. The Employees' Provident Fund Organization (EPFO) offers its members a special facility that allows you to pay your premium without spending a single penny from your own pocket.

Only these people will benefit from this special facility.
As comforting as this EPFO ​​rule sounds, it also has some strict provisions that need to be understood. This premium payment facility, under paragraph 68(DD) of the EPF scheme, is not available to everyone. The primary requirement for availing this benefit is that you are an active EPFO ​​member and have a balance equivalent to at least two months' salary in your PF account.

There's also a catch: the LIC policy you want to pay the premium for must be in your name alone. If you have a policy in the name of your wife, husband, or children, it cannot be paid from your PF funds. Furthermore, this rule applies only to Life Insurance Corporation of India (LIC) policies, not to plans from any private insurance company.

Work can be done from home, no need to make office visits
In the past, PF-related work required frequent visits to offices, but now the process has become much easier and online. If you want to choose this option, you'll need to submit Form 14. This process can be completed by logging in to the EPFO ​​website.

You'll need to access the portal using your UAN and password and select the LIC policy option in the KYC section. Here, you'll need to enter your policy number and other necessary information. Once your details are verified and the policy is linked to your PF account, the premium payment will automatically be deducted from your PF balance and transferred to LIC on the premium due date. This eliminates the hassle of remembering and the fear of late fees.

Benefits or Disadvantages?
This facility is certainly a great support in times of crisis. Its biggest advantage is that your policy doesn't lapse due to temporary financial hardship, and you don't need to borrow money. However, from a financial expert's perspective, there's another side to the coin.

PF funds are a support for your old age. When you pay premiums, that amount is reduced from your retirement fund. Since this money grows through compounding interest, even a small withdrawal today can result in a significant loss in the future. Therefore, it's advisable to use this facility sparingly. Rather than making it a habit, it is wise to look at it only as a 'backup plan' or emergency option.

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