I have been reading articles on Value Research Online and I find them very informative. I have purchased LIC Jeevan Tarang in 2010 and I have been regularly paying premiums since then. Recently I came to know the long term returns in the LIC policy are very low. I want to know from you whether I should surrender this policy now?
- Amey Joshi
LIC policies are basically meant to provide a life insurance cover. Most of them also have an investment component in them. But these policies fail on both counts: they provide very little insurance cover and they also five poor returns. Read about Jeevan Tarang policy here.
As you have completed three policy years, you may surrender this policy. Surrender value will be equal to 30% of the total amount of premiums paid excluding the premiums for the first year and all premiums in respect of optional benefits. We have assumed you have a regular premium pay policy and your age at the time of entry was over 12 years.
Once you surrender the policy, you will lose your existing insurance cover. Buy a plain term plan to secure a life insurance cover. Also, invest in mutual funds and other saving schemes, based on your objectives and risk appetite, to meet your various financial goals.