Loan Against LIC Policy: Now Apply Online

Good News: Now You can apply for a Loan against LIC Policy online. Earlier we used to apply for a loan offline by contacting the agent for understanding eligibility and details and paying a visit to your branch.

Now LIC has simplified the online process by making these methods easy and online, under which you can fill your loan application online. Not only loan, but you can also pay Loan Repayment/ Loan Interest Payment online.

Before giving more information about this, let me tell you about loan features given on LIC policy.

Features of Loan Received under LIC Policy

  • The amount of loan you can get is up to 90% of the surrender value.
  • All types of LIC policies are not liable for the loan as (Term Life Insurance), it is very important for you to check your loan eligibility.
  • You need to pay interest every half year.
  • The loan would be given for a minimum of 6 months period.
  • You can repay the loan principal with interest or just if you want to pay interest. If you want to pay only the interest on the loan, then the principal amount of the loan is reduced by the amount of your claim.
  • To take the loan on LIC policy, you have to complete at least 3 years of the premium paying term. which means you can only get the loan on 3 years + old policies.
  • You will have to keep LIC’s policy as security. LIC keeps all your original documents under their custody.
  • If you fail to deposit the interest within 30 days from the last day of payment, then LIC forcibly closes your policy and recovers the loan amount.
  • You can also take a second loan on your same LIC policy, whether your past interest is fully deposited or not. However, the amount given to you will be equal to ninety percent of the surrender value by adding two amounts.
  • You can take the loan from other banks also on LIC policy but it will not be beneficial for you and other banks can charge you more interest.
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Loan Against LIC Policy Online application process

As I told you earlier, LIC has now made the online process for all its loans and its payment.
The way to apply for the loan and pay online applications is like this.

  1. You have to go to the LIC’s home page and press the online loan button which is present in the online services tab or you can click here to go directly at
  2. As soon as you click on the online loan, you are redirected to another page. Two types of options are available on that new page, for an installment payment and for applying for a new loan.
  3. There you have to register yourself, in which you are given your login ID. If you already registered just log in.
  4. In the end, you will be able to register yourself after filling up all the types of options given to you to register yourself.

Benefits of taking a loan against LIC policy.

  1. The first thing is that you get a loan immediately in the time of your emergency on LIC policy.
  2. Now as I said that the process has become online, applying it has become very easy.
  3. Interest rates under this are less compared to other personal loans.
  4. Lots of flexibility has been given to repay the loan, which is not given in the other personal loan.
  5. Here you only have to give your policy document as proof, if you are taking personal loans from any other place, then you have to go through many eligibility processes.

The disadvantage of taking the loan against LIC policy.

  1. The amount of money you get as a loan is very limited as your surrender value will be. If you want more money then you cannot get that much loan amount on the LIC policy.
  2. You do not get any tax benefits.
  3. In the event of your tragic death, the values of your insurance are greatly reduced. Because the loan is still outstanding and the amount that your nominee receives benefits is reduced.
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As far as LIC’s traditional plans do not have many advantages as the increment of money is not as much. But yes, it can be beneficial in an emergency for anyone who needs a loan urgently and it can also be helpful for those who need a personal loan.

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