Sir I have Aviva life insurance policy premium payable 10 years,I have already paid 5 years, I want to discontinue, can I and how much surrender value can I get.

Ans: I appreciate that you are taking a clear decision about your Aviva life insurance policy.
You have courage to review and possibly improve your financial choices.
This step shows responsibility and seriousness about money.

» Can You Discontinue / Surrender the Policy
– Yes, most Aviva regular premium life policies allow surrender after some years of premium paid.
– If you have paid at least the minimum required number of premiums, you can get surrender value.
– Most Aviva plans require at least 3 years’ premiums before surrender value applies.
– If you have paid 5 years already, you satisfy this condition in most cases.

So yes, you can discontinue and surrender the policy now.

» What Happens When You Surrender
– When you surrender, the policy stops.
– All life cover, benefits and future bonuses stop immediately.
– You get a surrender value based on premiums paid and the rules of your policy.

» How Much Surrender Value You Might Get
Exact amount depends on your specific policy terms. But typical factors are:

– Insurance companies usually pay a Guaranteed Surrender Value.
– They sometimes also pay a Special Surrender Value if it is higher.
– You get the higher of Guaranteed or Special Surrender Value.

For many Aviva regular premium plans, a typical Guaranteed Surrender Value pattern looks like this:

– After 3 years: about 30%
– After 4 years: about 50%
– After 5 years: about 55%
– After 6 years: about 57.5%
– After 7 years: about 60%
– After 8 years: about 65%
– After 9 years: about 70%
– After 10 years: about 90%
– After full term: 100% of premiums paid

So if you have paid 5 years of premiums:
– You may receive roughly around 50% to 60% of your total paid premiums as surrender value.

The actual number will be based on your exact policy contract.

» Example (Illustrative Only)
If you paid Rs 1,00,000 total premiums by 5 years:
– Surrender value might be roughly between Rs 55,000 and Rs 60,000 under standard terms.

This is not exact for your case.
It is just to help you understand the mechanism.

» Special Surrender Value Component
– In some policies, the insurer may credit a special surrender value.
– This may include some part of bonuses or reserves.
– If it is higher than Guaranteed Surrender Value, you get that instead.
– Special values may change over time with company policy and regulator approval.

» What Documents You Need to Submit
Generally, you need these:
– Surrender discharge form from insurer.
– Original policy
– KYC documents like PAN and Aadhaar.
– Cancelled cheque for bank account.

The insurer will guide you with forms.

» What Happens After You Submit Surrender Request
– Company reviews premium history.
– They compute surrender value.
– They pay you the higher of Guaranteed or Special Surrender Value.
– This amount is paid to your bank account.

» Tax on Surrender Value
– Surrender value of life insurance can be taxable.
– It may be treated as income from other sources in some cases.
– Tax depends on policy type and premium structure.

You should confirm tax treatment before finalising surrender.

» Things to Know Before You Surrender
– You lose life cover immediately.
– You lose future bonuses if any.
– Surrender value is often much lower than premiums paid.
– Early exit penalties apply in many policies.

Surrendering is possible, but cost can be high.

» Why Surrender Value Is Lower
– Insurers recover acquisition costs and commission.
– Early exit penalties apply.
– This structure impacts early-year exits heavily.

Because of these reasons, surrender value feels disappointing.

» Should You Consider Alternatives
Before surrendering fully, consider:
– Paid-up option.
– You stop premiums but keep reduced benefits.

Paid-up may give better value than immediate surrender.

Your exact option depends on policy terms.

» Important to Check in Your Policy
Ask for a written statement showing:
– Guaranteed surrender value as on date.
– Special surrender value, if available.
– Paid-up benefit details.
– Impact on coverage and future benefits.

Always take figures in writing.

» Next Step for You
– Contact Aviva customer service.
– Ask for surrender value quote today.
– Ask for paid-up option quote also.
– Compare both before deciding.

Getting clarity reduces regret later.

Finally, you are free to stop the policy now.
But surrender value will be lower than premiums paid.
Decision should balance loss versus future benefit.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

https://www.youtube.com/@HolisticInvestment