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How can I revive a policy?

A policy gets lapsed if the premiums are not paid within the due date or the period of grace permitted by the insurance company. However, a lapsed policy can be revived and procedure varies from company to company.

In case of LIC a lapsed policy can be revived within 5 years from the date of first unpaid premium. There are five different schemes under which a policy can be revived.

Ordinary Revival Scheme : Under this scheme, all the arrears of unpaid premiums with interest have to be paid. Along with this, 'Declaration of Good Health' in Form No. 680 and medical certificate, if necessary, are required.

Special Revival Scheme : If a person is not in a position to pay all the arrears, then, he can choose this scheme. Under this scheme, the date of commencement will be shifted so that the policy is not lapsed just prior to the date of revival, i.e, the date of commencement is advanced approximately by the period of lapse. Other requirements like 'Declaration of Good Health' and Medical certificate wherever necessary are required as in Ordinary Revival.

Special Revival is allowed under the following conditions :
The policy should not have acquired any surrender value.

Revival should be within 3 years of lapse.
Special Revival is allowed only once during policy term.

Revival by Instalment method: If a policy holder cannot pay arrears in one lumpsum and if the policy cannot be revived under Special Revival Scheme, he can make use of Instalment Revival Scheme. In this scheme, on the date of revival he has to pay immediately:

» 6 months premiums, if mode is Monthly
» 2 quarterly premiums, if mode is Quarterly
» 1 Half year premium, if mode is Halfyearly
» Half of the yearly premium, if mode is Yearly

The balance of revival amount is paid in instalments spread over two years along with normal premium instalments. Other requirements regarding health are, as required in Ordinary Revival Scheme.

Loan-cum-Revival Scheme : If a policy acquires surrender value on the date of revival, the policy can be revived taking a policy loan. Loan amount will be calculated treating the premiums as paid upto the date of revival. Short fall, if any, in revival amount is called for. If loan amount is more than required for revival, the excess will be paid to the policy holder.

Survival Benefit-cum-Revival Scheme : The Survival Benefit which falls due in a money-back type of policy can be used for revival of the policy, if date of revival is later than the Survival Benefit due date. Here, if the SB amount is less than the revival amount, the short fall will be called for. If the SB is more than the revival amount, the excess is paid back to the policy holder. The other requirements for normal SB settlement and revival requirement are to be fulfilled.


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