The Life Insurance Corporation of India (LICI) was established on 1st September 1956 when the Indian Parliament passed the Life Insurance Corporation Act to nationalize the life insurance business. LIC, therefore, became the sole life insurance provider in India enjoying a monopoly position in the insurance market. The company is, therefore, the oldest life insurance company in India and enjoys a customer base of more than 250 million individuals. Today, the company has a presence pan India with more than 2040 branch offices and 113 divisional offices. The company issues all types of life insurance policies so that individuals with different financial needs can find a suitable insurance solution at a single platform.
Since LIC is trusted among its customers, it has the largest market share in the life insurance segment. Many of its policies have been subscribed by policyholders who continue to enjoy good coverage under LIC’s plans. To make premium payments easy, LIC offers its customers various ways in which the premiums can be paid. Let’s understand what these premium payment ways are –
There are, broadly, two ways of paying LIC premiums – offline and online. Each of these ways is further sub-divided into different means to offer you flexibility in premium payments. So, let’s understand each mode of premium payment in details –
Offline premiums for LIC policies can be paid in any of the below-mentioned ways –
NACH means National Automated Clearing House and it is an electronic payment facility offered by the National Payments Corporation of India (NPCI). You would have to submit a NACH mandate form at the nearest LIC branch from which you have bought the policy. Your bank account number should be mentioned on the form. After the form is submitted, LIC would clear it with your bank. If your bank validates the mandate, the premium would be automatically debited from your bank account.
You can register with your bank to pay LIC premiums directly from your bank account through Bill Pay facility. You can register for Bill Pay facility online or offline. After registration, you give your bank the authority to debit LIC premium from your bank account whenever it is due.
You can also pay your LIC premiums through the ATMs of specified banks. Axis Bank and Corporation Bank will allow you to pay premiums through their ATMs. Premiums for all types of LIC policies, except unit-linked plans, health plans and online term plans, can be paid through ATM. Monthly premiums and premiums payable under the Salary Saving Scheme would, however, not be accepted at ATMs. To pay premiums through ATMs, you would have to register for the same with your bank and the facility is available only to the customers of Axis Bank and Corporation Bank.
Since digital premium payment modes have become popular, LIC allows you to pay its premiums online. LIC online payment can be done through the following means –
The website of the company allows you to pay LIC premium online with the help of a few clicks of your mouse. You can pay the premium directly without registering as a customer. Alternatively, if you are registered for LIC’s online services, you can pay through the company’s customer portal. The steps for payment through both of these means are as follows –
You can pay premiums through your debit card, credit card, mobile wallet, UPI platform or net banking facility offered by your bank.
LIC has partnered up with Axis Bank, City Union Bank and IDBI Bank to serve as authorized premium collection points for LIC policyholders. You can, therefore, visit the nearest branch of any of these authorized banks across India and pay your LIC premiums on their counter through cash or cheque. If you are paying through cheque, the cheque should be drawn on the bank. Once the premium is paid, the bank would issue a premium receipt which is a valid proof of premium payment. LIC would not issue any other receipt as the bank issued receipt would be sufficient. You can pay premiums for all types of LIC policies except unit-linked plans, health insurance plans and online term plans. The premium can be paid up to 30 days in advance. However, monthly and quarterly premiums would not be accepted if the policy is maturing after the premium has been paid. No additional charges are levied by the banks if you pay your LIC premiums through them.
LIC has various franchises which allow you to do LIC online payment of premiums. These franchisees are as follows –
To pay premiums through any of these franchisees you would have to deposit cash. Premiums cannot currently be paid through cheques. As soon as you deposit the premium, the cash collection counter would issue a signed premium receipt which would be a valid proof of premium payment against your LIC policy. Premiums of all policies can be paid up to 30 days in advance. However, premiums for unit-linked plans, online term plans and health plans are not accepted by these franchisees. No additional cost is applied on a collection of the premium by these franchisees making it easy for you to do LIC online payment of your policy premiums.
Various merchants are also tied up with LIC for LIC online payment facility. These merchants are as follows –
These merchants are allowed a user ID and password which connects them with LIC portal. Using the portal connection, they can collect premiums on behalf of LIC and log the premiums with the company. After collecting premiums up to a predefined limit (the limit is defined by the marketing department of LIC), the merchants deposit the amount in Axis Bank or any branch of LIC. They can also deposit cash invoice online through LIC’s portal through the net banking facility of their bank account. Payment can be done through cash or cheque. You can pay the premiums for all types of policies except online term plans. Upon receiving the premium, the merchants issue a signed premium receipt which serves as a valid proof of premium payment.
By allowing online payment facility for premiums, LIC has offered its customers a host of benefits. These benefits are as follows –
Once the policy is issued, you are required to pay the premiums on each due date. Premiums can be paid annually, half-yearly, monthly or quarterly and the due date is fixed accordingly. However, you might miss a premium payment due to any reason. Some common reasons why premium payments are missed include the following –
If the premiums are not paid, the policy lapses and the coverage stops. However, LIC offers its customers the benefit of a grace period to pay the premium due. During the grace period, the policy does not stop. You get full insurance coverage.
Grace period means an extra period allowed to pay the outstanding premium. The grace period allowed under LIC policies is 30 days if you pay the premiums annually, quarterly or half-yearly. However, if the premiums are paid monthly, the grace period allowed is 15 days. Here are some of the aspects of grace period which you should know –
To pay premiums through PayTM, you should open the application on your mobile or visit the website of PayTM. On the application or website, select ‘Insurance’. Then select ‘Life Insurance Corporation of India’. You would then have to enter the policy number of your LIC policy and click ‘Proceed’. Thereafter, you would be prompted to pay the premium. Premiums can be paid using the existing balance in your PayTM wallet or through credit cards, debit cards, net banking, UPI, etc.
In case of double premium payments, the extra premium paid would be refunded by LIC within 6 to 8 days of payment.
Yes, if you make LIC online payment of premium through your credit card, a convenience fee would be charged on the premium amount paid. This convenience fee is not for LIC but for the credit card network which is allowing LIC online payment. However, if you are an Axis Bank customer, your convenience fee would be borne by the bank itself and you would not be charged anything extra. Moreover, if you pay through debit card or net banking facility, the applicable convenience fee would be borne by LIC itself.
No, online premium payments are accepted only for those policies which are in force on the date the premium is paid.
In case you cannot see the premium credited to your policy account within 10 days of payment through an authorized bank, you should contact the bank immediately. You should present the premium payment receipt issued by the bank and ask for the reason of non-credit of premium. The bank would then check the whereabouts of your premium deposit and credit your premium to your policy at the earliest.