Surrender Value Factors applicable to the premiums paid
| Policy Term | ||||
| 16 years | 21 years | 25 years | ||
| No. of years of premiums payment | 1 | 0.00% | 0.00% | 0.00% |
| 2 | 0.00% | 0.00% | 0.00% | |
| 3 | 30.00% | 30.00% | 30.00% | |
| 4 | 50.00% | 50.00% | 50.00% | |
| 5 | 50.00% | 50.00% | 50.00% | |
| 6 | 50.00% | 50.00% | 50.00% | |
| 7 | 50.00% | 50.00% | 50.00% | |
| 8 | 53.75% | 52.30% | 51.80% | |
| 9 | 57.50% | 54.60% | 53.50% | |
| 10 | 61.25% | 56.90% | 55.30% | |
| 11 | 65.00% | 59.20% | 57.10% | |
| 12 | 68.75% | 61.50% | 58.80% | |
| 13 | 72.50% | 63.80% | 60.60% | |
| 14 | 76.25% | 66.20% | 62.40% | |
| 15 | 80.00% | 68.50% | 64.10% | |
| 16 | 80.00% | 70.80% | 65.90% | |
| 17 | 73.10% | 67.60% | ||
| 18 | 75.40% | 69.40% | ||
| 19 | 77.70% | 71.20% | ||
| 20 | 80.00% | 72.90% | ||
| 21 | 80.00% | 74.70% | ||
| 22 | 76.50% | |||
| 23 | 78.20% | |||
| 24 | 80.00% | |||
| 25 | 80.00% | |||
The Bonus which accrued in the plan also gets a Surrender Value.
Surrender Value Factors for Bonus in the LIC Jeevan Labh Plan
| Policy Term | ||||
| 16 years | 21 years | 25 years | ||
| No. of years of premiums payment | 1 | 0.00% | 0.00% | 0.00% |
| 2 | 0.00% | 0.00% | 0.00% | |
| 3 | 17.58% | 15.93% | 15.28% | |
| 4 | 17.66% | 16.22% | 15.42% | |
| 5 | 17.85% | 16.58% | 15.55% | |
| 6 | 18.16% | 17.03% | 15.72% | |
| 7 | 18.60% | 17.58% | 15.93% | |
| 8 | 19.18% | 17.58% | 16.22% | |
| 9 | 19.93% | 17.66% | 16.58% | |
| 10 | 20.85% | 17.85% | 17.03% | |
| 11 | 21.99% | 18.16% | 17.58% | |
| 12 | 23.38% | 18.60% | 17.58% | |
| 13 | 25.05% | 19.18% | 17.66% | |
| 14 | 27.06% | 19.93% | 17.85% | |
| 15 | 30.00% | 20.85% | 18.16% | |
| 16 | 35.00% | 21.99% | 18.60% | |
| 17 | 23.38% | 19.18% | ||
| 18 | 25.05% | 19.18% | ||
| 19 | 27.06% | 20.85% | ||
| 20 | 30.00% | 21.99% | ||
| 21 | 35.00% | 23.38% | ||
| 22 | 25.05% | |||
| 23 | 27.06% | |||
| 24 | 30.00% | |||
| 25 | 35.00% | |||
Let us understand how this works with the help of an example.
Suppose Gurdeep has taken the Jeevan Labh plan with a cover of 5 lakhs and a policy term of 25 years. His Annual Premium was Rs. 21,000 + taxes. Each year, a bonus of Rs. 40 per 1,000 Sum Assured was declared. The bonus declared is an assumption to show how the surrender value is calculated.
He paid the premium for 7 years. Now due to a financial crunch, he decided to surrender the plan. This is the amount he will get on surrendering the plan.
Premium Paid so far = 7 x 21,000 = Rs. 1,47,000
Surrender Value Factor for premiums = 50% (marked in the blue in the 1st table)
Bonus received in the plan in 7 years = (40 x 5,00,000 / 1,000) x 7 = Rs. 1,40,000
The Guaranteed Surrender Value of the Jeevan Labh would be as follows:
Surrender Value of Premiums = Rs. 1,47,000 x 50% = Rs. 73,500
Surrender Value of Bonus = Rs. 1,40,000 x 15.93% = Rs. 22,302
So Gurpreet will get Rs. 73,500 + Rs. 22,302 = Rs. 95,802 if the plan is surrendered after 7 years.
This is the Guaranteed Surrender Value. A Special Surrender Value maybe paid by LIC - this value can only be known at the time of actual surrender.
To know more about how this plan works - Read the LIC Jeevan Labh Review.
In case you have any questions on this, please drop a comment and we will get back to you.