Have a lapsed policy? Here’s how you can benefit from the Revival Processby Himani Mathur Content Writer
Life insurance is basically an agreement between an insurer and a policyholder wherein the insurer agrees to pay the policyholder a certain amount of money in the event of the sudden death of the designated person or after a certain time frame, in lieu of a premium that the policyholder pays to the insurer. However, in case you forget to pay the premium by the due date; then there are chances that you may not get the benefits at all and the policy is forfeited. Most insurers usually offer a grace period of few days to the policyholder in case the premium has not been submitted on time. But in case the premium is not paid even by the grace period then the policy can get lapsed.
However, just as there is a way out for everything, in case your life insurance policy has lapsed; you can always take help of the ‘revival process’ to renew the same. Mentioned below are the different schemes available which can help you to revive the lapsed policy:
- Special Revival: This scheme allows the insured person to pay only one due premium basis his or her age after shifting the date of commencement of the policy. This type of scheme can be selected by people who are not able to pay the premium in total at a time. Here also the policyholder may be asked to submit a medical report and declare good health under form no 680. In addition to this, there are certain terms and conditions that need to be achieved in case the insured person under special revival scheme wants to revive the policy and they are:
- This scheme can be used only once in the entire policy tenure.
- The policyholder can avail of the special revival facility only within 3 years of the policy getting lapsed.
- Ordinary Revival: Under this scheme, the lapsed life insurance policy can be revived just by paying all the due premiums along with the interests. But in this case, the policyholder may be asked to declare medical report and good health under form no 680.
- Installment Revival: This is ideal for those policyholders who cannot pay the due premium in special and lump sum revival. Under this scheme, the payment can be made in the following ways:
o The policyholder will need to pay half of the yearly premium in yearly premium mode.
o The policyholder will need to pay one half of the yearly premium in the half-yearly mode of premium payment.
o The policyholder will need to pay two quarterly payments in quarterly premium payment mode.
o Under the monthly mode of premium payment, the insurance holder can pay a regular six-monthly premium.
- Loan Cum Revival Scheme: In this case, the policyholder has the ability to revive the policy by taking a policy loan if on the date of revival the policy acquires a surrender value. The policyholder will need to pay the additional amount in case there is any deficit in the revival amount. In case the loan amount is more than the revival amount then the additional amount will be paid to the insured person.
These are some of the options available by which the life insurance can be revived in case it has lapsed owing to non-payment of the premiums.
Those like the HDFC Life Insurance can be easily renewed online on various insurance broking portals that facilitate easy purchase, renewal and comparison of insurance policies. However, although there is always a way out to revive the policy, it is always best to keep renewing the policies on time so you do not have to go through unnecessary hassles.
Created on Jan 16th 2018 02:10. Viewed 304 times.