I have a lic policy of 4 lakhs ( money back) for 16 years , I paid premium for 14 years properly and got the money back after every 4 years. My policy will mature in 2026 december but due to some very urgent needs I pledged the LIC policy with LIC itself in 2024 june but due to financial issues I have not been able to pay the balance premium or principal and interest for the loan taken against the policy. Will I get any amount from LIC on maturity of the policy in 2026 December ??

Ans: Hi Sharad, unfortunately when you stop paying your premiums, the policy lapses. If your policy has lapsed owing to non-payment of premiums on time, the terms and conditions of the policy contract are null and void until you reinstate it. A lapsed coverage must be reinstated by paying the accumulated premiums with interest and providing the necessary health information.You will have to pay the premiums of the years missed and then the policy will get revived.

Ans: Policy Overview

Your LIC policy matured in 2023.
You received a maturity amount of around Rs. 12 lakhs.
LIC deducted a TDS of Rs. 45,000.
Interest Income and Tax Implications
TDS indicates interest income is added to your income.
In this case, the interest income appears to be Rs. 4.5 lakhs.
Interest income from such policies is taxable.
Tax Rebates for Old LIC Policies
Policies started before 2012 might have different tax rules.
Check if your policy qualifies for any old tax exemptions.

Assessing the Financial Outcome
Your premiums were about Rs. 30,000 yearly.
You paid premiums for 20 years.
Evaluate if the maturity amount meets your financial goals.

Evaluating Investment Options
Consider reinvesting the maturity amount.
Actively managed funds can offer better returns.
Engage a Certified Financial Planner for personalized advice.
Avoiding Index Funds and Direct Funds
Index funds have limited potential in volatile markets.
Actively managed funds provide better risk management.
Regular funds through an MFD with CFP offer professional guidance.

Final Insights
Analyze your overall investment strategy.
Ensure your investments align with your financial goals.
Regularly review and adjust your portfolio for optimal performance.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: Hello;

You can apply for duplicate policy certificates from LIC by the process laid down for the same.

It is quite cumbersome so better would be if you can search and find policy certificates at your home or agent office.

The agent seems to have provided you with incorrect information.

You are entitled to receive sum assured under the life insurance policies taken for your late father.

Best wishes;

Ans: You have held these LIC policies for a long time.

You have been disciplined in paying premiums.

That shows commitment and patience.

But it is also important to assess if they are helping you build wealth.

Let us do a complete 360-degree assessment from a Certified Financial Planner’s view.

This will help you take a confident and informed decision.

Your Existing LIC Policies – A Summary Review

Policy 1: Jeevan Saral (started Dec 2008)

Monthly premium: Rs.1,021

Sum Assured: Rs.2.5 lakhs

Maturity: Dec 2043 (35 years term)

Policy 2: Jeevan Saral (started July 2007)

Half-yearly premium: Rs.15,162

Sum Assured: Rs.6.25 lakhs

Maturity: Dec 2043 (36.5 years term)

Policy 3: Jeevan Mitra – Triple Cover (started April 2003)

Annual premium: Rs.3,731

Sum Assured: Rs.1 lakh

Maturity: April 2033 (30 years term)

Policy 4: Jeevan Anand (started Nov 2003)

Annual premium: Rs.4,176

Sum Assured: Rs.1 lakh

Maturity: Nov 2027 (24 years term)

What Needs to Be Evaluated in Your Policies

Total premium paid so far.

Number of years left for maturity.

Guaranteed maturity benefit.

Bonus declared each year by LIC.

Internal Rate of Return (IRR).

How Jeevan Saral and Other LIC Plans Really Perform

LIC policies are mostly traditional endowment-type products.

They promise guaranteed returns and bonuses.

But the real returns are usually very low.

In most Jeevan Saral cases, final returns are between 4% to 5% per year.

Some even get less than 4% IRR.

That is much below inflation.

Why Jeevan Saral Needs Serious Review

LIC stopped selling Jeevan Saral.

There were many complaints about maturity mismatch.

Projections made by agents were often too optimistic.

Agents showed high maturity values which were not guaranteed.

In reality, maturity depends on age at entry and term.

Older policyholders often got very low maturity values.

Your Jeevan Saral Policies – Key Concerns

One policy has Rs.1,021 monthly premium for 35 years.

The total premium paid will be nearly Rs.4.3 lakhs.

Sum assured is only Rs.2.5 lakhs.

Expected maturity can be Rs.5 to 6 lakhs depending on bonus.

But that means less than 5% return for 35 years.

Second Jeevan Saral policy has higher premium of Rs.15,162 half-yearly.

Total paid will cross Rs.21 lakhs by 2043.

Sum assured is Rs.6.25 lakhs only.

Even with loyalty additions, returns may remain under 5.5%.

What About Jeevan Mitra and Jeevan Anand?

These are older plans with low sum assured.

Jeevan Mitra offers triple cover but investment value is low.

Jeevan Anand continues coverage even after maturity.

But it is of no real benefit unless it is for life insurance need.

Premiums are small, but the returns are not attractive.

Total investment is locked in for long term.

Big Issue – Mixing Insurance with Investment

LIC policies combine insurance and investment.

This is not ideal.

Insurance should give protection only.

Investment should create wealth.

Mixing both gives neither good coverage nor good returns.

Why You Should Surrender – Analytical Assessment

Your goal should be wealth creation and financial protection.

These LIC policies give low returns.

Real return after inflation may be zero or negative.

Even if held till maturity, returns remain weak.

These funds are better used in mutual funds with CFP guidance.

What Happens If You Surrender Now?

All your policies have completed more than 20 years or close to it.

That means surrender value will be higher than early years.

LIC will give you guaranteed surrender value plus bonuses.

In most cases, surrender gives 30% to 50% of total premiums paid.

But if you reinvest wisely, you can recover this gap.

The earlier you surrender, the faster your wealth creation begins.

Reinvestment Strategy – 360-Degree View

Surrender values can be reinvested into mutual funds.

Use actively managed equity funds with long term view.

Always invest through a CFP and MFD, not in direct plans.

Direct funds do not offer help or regular review.

Regular funds via CFP give guidance, rebalancing and emotional support.

Why Not Direct Funds? Key Disadvantages

No one to support during market fall.

No plan to shift asset when goals change.

No help in tax planning.

No family guidance in your absence.

Most people stop SIPs or withdraw in panic without advisor help.

Returns in direct funds may look high, but are rarely achieved.

Why Not Index Funds Also

Index funds copy market blindly.

They can’t protect from downside.

They don’t shift allocation during market bubble.

You get average market returns only.

No active fund manager to add value.

Good active funds have beaten index consistently in India.

India is not yet a mature market for passive investing.

What You Must Do Now – Action Steps

Take surrender quotes for all four LIC policies.

Check exact surrender value and accumulated bonuses.

Do not delay. Every month wasted is loss of growth.

Consult a Certified Financial Planner and execute surrender with confidence.

Shift the proceeds to mutual funds under long-term plan.

Allocate funds based on your risk level and goals.

Use SIPs and STP for reinvestment if large corpus.

Do You Need Insurance Now Separately?

Buy a term insurance plan for full protection.

Term plan is pure cover, no savings.

Premium is very low for large cover.

It is best way to protect your family.

Final Insights

You have kept the policies for long. That discipline is rare.

But continuing them will not create meaningful wealth.

LIC policies serve purpose only for guaranteed returns and simple safety.

But they don’t grow your money fast.

You should not mix insurance and investment.

Surrendering is not a loss. It is a correction.

Mutual funds offer better returns, more flexibility and full transparency.

You will also get better control of your money.

Your money must work for you. LIC policies are not doing that.

With right CFP guidance, you can recover and grow faster.

Start now. Every month delayed is growth lost.

Take smart decisions. Not emotional ones.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

Ans: Hello;

You may expect to receive a sum of 10-12 L at maturity from this endowment policy.

Best wishes;