How to Calculate Maturity Value of LIC?
Calculating the maturity value of your LIC policy involves a simple formula. The maturity value is the amount that an insurance company will pay you when your policy matures. To calculate the maturity value of LIC, you can use the following formula:
Maturity Value = Sum Assured + Bonus
The “Sum Assured” is the amount of money that the insurance company promises to pay you in case of death or maturity of the policy. The “Bonus” is the additional amount that LIC may give you based on the performance of the company and your policy during its term.
Let’s say you have an LIC policy with a sum assured of $1,00,000 and an accumulated bonus of $20,000.
Therefore, the maturity value of your LIC policy will be:
Maturity Value = $1,00,000 + $20,000 = $1,20,000
So, by using this formula, you can easily calculate the maturity value of your LIC policy.
FAQs on How to Calculate Maturity Value of LIC
1. Is LIC the same as maturity value?
No, LIC is the Life Insurance Corporation, a government-owned insurance company in India. Maturity value, on the other hand, is the amount an insurance company pays you when your policy matures.
2. How is LIC maturity value calculated?
LIC maturity value is calculated by adding the sum assured and any bonus accrued during the policy term.
3. What is sum assured in LIC?
The sum assured in LIC is the guaranteed amount that the insurance company promises to pay the policyholder in case of death or maturity of the policy.
4. How is LIC bonus calculated?
LIC bonus is calculated based on the performance of the company and the policy during its term. It is usually expressed as a percentage of the sum assured.
5. Can I calculate my LIC maturity value online?
Yes, LIC provides online tools and calculators on its website that can help you calculate the maturity value of your policy.
6. What factors affect LIC maturity value?
Factors such as the sum assured, bonus rate, policy term, and performance of the company can affect the maturity value of an LIC policy.
7. Is LIC maturity value taxable?
The maturity value of an LIC policy is usually tax-free under Section 10(10D) of the Income Tax Act, 1961, as long as certain conditions are met.
8. Can I surrender my LIC policy before maturity?
Yes, you can surrender your LIC policy before maturity, but you may incur a surrender charge and receive a reduced amount.
9. What happens if I miss paying LIC premiums?
If you miss paying LIC premiums, your policy may lapse, and you may lose the benefits associated with it. It is important to keep your premiums up to date to ensure the policy remains in force.
10. How can I increase the maturity value of my LIC policy?
You can increase the maturity value of your LIC policy by opting for higher sum assured, choosing a policy with better bonus rates, and keeping the policy in force for the entire term.
11. Can I take a loan against my LIC policy?
Yes, LIC policies usually have a loan facility where you can borrow money against the cash value of the policy. The loan amount is typically a percentage of the surrender value of the policy.
12. What happens if I surrender my LIC policy?
If you surrender your LIC policy before maturity, you will receive the surrender value, which is the amount that the insurance company will pay you after deducting any applicable surrender charges.