Loan Against LIC Policy: Here’s how to apply online, Eligibility Criteria, and Documents Required
Loans against LIC policies are secured personal loans provided by the Life Insurance Corporation of India (LIC). You can apply for this form of loan by keeping your LIC policy as security or collateral. Here’s how you can apply online for a loan against LIC policy, its eligibility criteria, and the documents required.
One of the biggest suppliers of insurance and other associated goods and policies in India is Life Corporation of India (LIC).
LIC offers a wide variety of insurance products, including term plans, endowment plans, plans for senior individuals, children, etc.
There are additional lenders who provide loans secured by LIC or other life insurance policies in addition to the Life Insurance Corporation of India. If your credit score is bad or you are having trouble securing a loan from a commercial or public sector bank, a loan against LIC policy is a simple option.
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Rates of interest will be determined by the applicant's profile. Only owners of LIC endowment policies are eligible for the loan. The loan amount is an advance on the plan's surrender value.
The LIC holds the insurance policy as collateral. As a result, the insurance provider has the right to refuse coverage if the applicant fails to make loan payments as agreed.
LIC maintains the right to revoke the policy if the loan obligation is greater than its surrender value. Before disbursing the proceeds of the plan to the policyholder, LIC reserves the right to deduct the requisite sum if the insurance policy matures before the loan is fully repaid.
Here’s how to apply online for a loan against the LIC policy:
- To create an account, go to the LIC e-Services Portal and select "Don't Have an account? The "Sign Up" button.
- To sign up for LIC eServices online, fill out the necessary information.
- You can complete the registration process by choosing a password after clicking "Proceed" to start the registration process. To log into your account, you may either create a User ID or use your email or mobile device.
- You can access your insurance details as well as the vast array of eServices provided by LIC after successfully logging in.
- Verify whether your insurance policy qualifies for a loan secured by a LIC policy.
- If so, you will be able to view the loan's terms, conditions, interest rates, and other features online.
- You might need to send your KYC documents to the local LIC Office or upload them after submitting the application in order to execute your loan request.
Here are the eligibility criteria for a loan against the LIC policy:
- The applicant should be at least 18 years old.
- The applicant needs a current LIC policy.
- The loan-insuring LIC policy has a guaranteed surrender value.
- At least three years' worth of LIC premiums must be fully paid.
Here are the documents required to apply online for the loan against the LIC policy:
- Properly completed application form and two passport-sized photos
- The original statement of policy
- Aadhaar cards, passports, voter ID cards, and other identification documents
- Aadhaar cards, voter ID cards, driving licenses, and utility bills (for water or electricity) serve as proof of domicile.
- Salary slips and a bank account statement are acceptable forms of identification.
- Any other document that LIC requires
However, the whole loan repayment schedule is sent to the borrower after the loan is approved, and it is also available online through the LIC eServices portal.