1. What is LIC Surrender Value?

The Guaranteed Surrender Value (GSV) is the amount payable by LIC when a policyholder voluntarily terminates the policy before maturity. It's typically calculated as 30% of the premiums paid minus the first year premium.

2. How Does the Calculator Work?

The calculator uses the standard LIC surrender value formula:

Where:

• \( Total\ Premiums \) — Sum of all premiums paid in rupees
• \( First\ Year\ Premium \) — Premium paid in the first year in rupees

Explanation: The formula accounts for the fact that insurers typically deduct the first year's premium completely as it covers initial expenses.

3. Importance of Surrender Value Calculation

Details: Knowing the surrender value helps policyholders make informed decisions about continuing or terminating their policy, especially in financial emergencies.

4. Using the Calculator

Tips: Enter total premiums paid and first year premium in rupees. Both values must be positive numbers, and total premiums should be greater than or equal to first year premium.

5. Frequently Asked Questions (FAQ)

Q1: When does a policy acquire surrender value?
A: Typically after payment of premiums for at least 3 full years.

Q2: Is the surrender value taxable?
A: Surrender value is generally tax-free unless it exceeds the total premiums paid.

Q3: Can I get more than the guaranteed surrender value?
A: Some policies may pay a special surrender value which could be higher, depending on bonuses and policy duration.

Q4: What's the difference between surrender value and paid-up value?
A: Paid-up value keeps the policy active with reduced benefits, while surrender value terminates the policy completely.

Q5: How long does it take to get the surrender amount?
A: Typically 15-30 days after submitting all required documents to LIC.