The main purpose of a life insurance cover is to protect the dependents of an individual in case of his/her untimely demise. The Life Insurance Corporation of India (LIC) is the largest life insurer in India, and it offers an array of life insurance covers for people with different requirements. The protection offered by an LIC life insurance cover remains active only as long as the premiums are paid within the due date. If the policy lapses due to non-payment of premiums, the insured will no longer be protected by the life insurance cover. The ideal thing to do is to never let a policy lapse and enjoy the insurance protection continuously. However, if an LIC policy lapses due to some unavoidable circumstances, there are certain options offered by the company for revival.
When it comes to policy revival, there are certain conditions set forth by LIC. These conditions must be satisfied by policyholders in order to effect a revival of their life insurance covers. Also, it must be noted that policy revival involves initiating a fresh contract between the insurer and the insured. In this situation, the insurer may come up with some new terms and conditions for the policyholder. Before we find out the different types of revival methods, let’s take a look at the grace period offered by LIC for policy renewal.
Grace period refers to the additional time offered by LIC for renewing a policy. This grace period is available for almost all the policy covers available with LIC. A grace period of 30 days from the renewal deadline date is offered by LIC if the premiums are paid on a quarterly, half-yearly, or annual basis. For monthly premium payment mode, the company offers a grace period of 15 days. It must be noted that there will not be any coverage during this grace period. In other words, if the insured suffers an accidental death during this grace period, the company has no legal obligation to provide compensation to his/her dependents. If the premium amount is not paid even during this grace period, the policy will lapse. The policyholder can take any of the following choices for reviving a policy after its lapsation.
LIC policies that have lapsed can be revived through any of the following options:
The methods listed above are the ways outlined by LIC to revive a life insurance policy after lapsation. Reviving a policy has its own benefits. It could be a little bit expensive to revive a policy after its lapsation. However, it is certainly cost effective than purchasing a new policy, which might have much higher premiums. If a lapsed policy is still within the revival limit, it is definitely worthwhile to go ahead with the revival process.