My LIC Experience – Need Advice on Surrender (Plan 936 – Jeevan Labh)

[dreamer007]

When I landed a decent job, one of my relatives (also an LIC agent) convinced my dad to buy a “safe investment plan” for me. They even said they paid my first premium from their pocket — maybe true, can’t verify because payments were made through different apps back then by me.

Here are the actual details

Plan: LIC Jeevan Labh (936)
Age at entry: 21
Policy Term: 25 years
Premium Paying Term: 16 years
Sum Assured: ₹10 lakh
Death Sum Assured: ₹10 lakh
Annual Premium: ≈ ₹45,890 (after 1st year tax 2.25%)

Approximate maturity (as per LIC illustration):

• SA ₹10 L
• Bonus ₹12.5 L
• Final Bonus ₹4.5 L
  Total ≈ ₹27 L after 25 years

Now I’m 25 and have already paid 3 years’ premiums.

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My view now​

After learning a bit of personal finance, I realise this is basically a 5 – 5.5 % return product with a tiny life cover.
I’ve already taken a term insurance for ₹2.1 Cr (annual premium ₹19 k) — much cheaper and with proper coverage.
At 40 LPA base, locking ~₹46 k/year for such low returns makes no sense.

I spent ~30–40 minutes on the LIC portal trying to surrender it online, but there’s no option at all (seems allowed only for ULIPs).

When I told my dad I want to close it, he said “why bother, the agent paid one premium, it’s not a big portion of your salary. and ofcouse relative........”
But honestly, I don’t get any real benefit here.

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Key facts​

• 3 premiums paid so far (~₹1.38 L total).
• Plan acquired surrender value (eligible after 3 years).
• I want to surrender or make it paid-up — whichever is smarter.
• I’ll invest that money into index/flexi-cap SIPs instead.

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​

Need community help​

1. Does surrendering a policy impact the agent?
    Do they get penalised or lose commission? (just trying to avoid drama)
   
   
2. Is the agent involved in the surrender process?
    Can I do it myself directly at the branch without informing anyone?
   
   
3. Any idea how much surrender value I’ll roughly get now?
    (3 years paid on 25-term, 16-PPT, ₹10L SA plan.)
   
   
4. Can the process be done fully online or via email?
    If anyone has done it recently, please share exact steps.
   
   
5. Anything I should be careful about before submitting the policy at branch?

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My intent​

Not blaming anyone — I know the relative probably meant well, but this plan is dead weight now.
Just want to stop further losses and reinvest smarter.

Any genuine suggestions or first-hand experiences are welcome

 

[arjungoyal12]

Totally get where you’re coming from, a lot of us have gone through something similar with traditional LIC plans sold as “safe investments.” You’ve done the right thing by re-evaluating it early.

Since you’ve already completed 3 years, your policy has acquired a surrender value, so you do have options:

• Surrender vs Paid-up: If you surrender now, you’ll get back a portion of what you’ve paid (usually 30–35% of total premiums minus first-year premium). If you make it paid-up, you won’t pay further premiums but will get a reduced sum assured and bonus at maturity.
• Agent involvement: The agent doesn’t get penalized or blocked for your surrender, they just stop getting future renewal commissions. You can do the process directly at the LIC branch; there’s no need to contact the agent.
• Process: Sadly, surrendering can’t be done fully online yet (except ULIPs). You’ll need to visit your home branch with your policy bond, ID proof, bank details, and a simple surrender form. They’ll tell you the surrender value upfront.

If you’re planning to invest that money into SIPs, that’s a solid call — better returns, more flexibility, and transparency. Are you thinking of surrendering right away or waiting till the next premium due date?

 

[dreamer007]

Thankyou @arjungoyal12

I am planning it to surrender it right away, since the next premium will be due on April 2026. I wanted to sort it out as soonest possible.

Thanks again,
Sid

 

[Dsd]

The problem is not in the product, but we mix the Life Insurance and Investment. Then it starts making a problem because we expect a return from a Life Insurance, which is opposite to its nature; it's a safety guard, not an investment. If it's only Life Insurance, then it's okay, or vice versa.
Still, in some cases it is good, but having only one Policy in which less Investment is going and better if you are exposed to other investing categories.