LIC Policy Loans
The Corporation can grant a loan to the policyholder against his policy as per the terms and conditions applicable to the policy. The requirements for granting a loan are as under :
a) Application for loan with an endorsement of terms and conditions of the loan being placed on the policy.
b) Policy to be assigned absolutely in favour of the Corporation
c) A receipt for the loan amount
The maximum loan amount available under the policy is 90% of the Surrender Value of the policy (85% in case of paid up policies) including cash value of bonus.
The rate of interest charged on loans is at 9% to be paid half-yearly.
The minimum period for which a loan can be granted is six months from the date of its payment. If repayment of loan is desired within this period the interest for the minimum period of six months will have to be paid.
In case the policy becomes a claim either by maturity or death within six months from the date of loan interest will be charged only upto the date of maturity/death.