CRM Department, Central Office.
5
Jeevan Bima Marg, P.O.Box No.19953,
Mumbai – 400 021.
Tel : 66598353, Fax : 22825829
E-mail
th Floor (Link), “Yogakshema”,co_crm@licindia.com-------------------------------------------------------------------------------------------
Ref: CO/CRM/838/23 July 28, 2011
To,
All Zonal Managers,
All Regional Managers (CRM)
All Sr/Divisional Managers,
M.D.C., Audit & Inspection
RE: SURRENDER OF POLICIES UNDER JEEVAN AKSHAY PLANS AND DEFERRED ANNUITIES
PLANS AFTER VESTING OF ANNUITY
Strictly speaking, there is no provision for surrender of policies under immediate annuity
plans or deferred annuities plans after vesting of annuity. However, Actuarial Dept, Central
office has allowed the surrender value under immediate annuity plans and deferred annuity
plans after vesting
expenses incurred or to be incurred on his/her medical treatment or for the medical
treatment of his/ her spouse, provided the annuity option is under “annuity for life with
return of purchase price on death”. The surrender factors were revised on 7
As per letter dt 13/1/2007 ref: Actuarial /PS, the Regional Managers( Actuarial) are
authorised to sanction such surrender payments. Subsequently, as per our circular dt.
21/4/2009 Ref: CO/CRM/741/23, the powers to sanction the surrender payment under
eligible cases was delegated to Divisional Office standing committee upto net surrender
value of Rs. 1 lakh.
It has been observed that many requests are now being received to allow surrender
payment under vested annuity policies for reasons other than medical emergencies and
sometimes even within one year of purchasing the policy. It appears that annuity plans are
being sold by highlighting that these plans offer easy liquidity and can be surrendered
whenever required. Due to this reason, the number of surrender requests is also increasing.
The matter has been reviewed by the competent authority and it has been decided as
follows:-
on merit of the case like money is required by annuitant for theth May 2010.•
annuity option of ‘ Annuity for life with return of purchase price on death’ shall be
allowed only in
close family members
policies should not be allowed.
surrender of immediate annuity plans and Deferred annuity plans after vesting withcase of medical emergency like treatment of self, spouse, and /or. Under any other circumstances, surrender of vested annuity•
with his/her consent on surrender value quotation generated through FEAP module.
The policyholder’s written request to surrender the policy should be obtained along•
expenses from annuitant.
The Office should also ask for documentary proof in support of illness and related•
surrender duly signed by annuitant and documentary proof with self contained note
to respective office i.e Divisional office or Regional Manager( Actuarial) depending
upon the amount of surrender value payable.
After receipt of this, office should forward the request of annuitant , quotation for•
higher office but should be kept by Branch office only.
Original policy document and surrender discharge form should not be forwarded to•
should be collected from the annuitant and to be forwarded to IPP cell of Zonal
office.
The annuity cheques already issued and falling due after the date of surrender value•
their record after receipt of sanction from Divisional Office standing committee or
Regional Manager (Actuarial). After taking action of surrender by IPP cell in annuity
master, branch should process the surrender payment thorough loan/ surrender
module of FEAP. Under no circumstances, manual voucher should be prepared.
It should be ensured that IPP cell of the Zonal office takes the surrender action in•
policy, all annuity instalments upto date of surrender have been settled.
Kindly, bring the provisions of this circular to the notice of the offices under your
jurisdiction and ensure that instructions are adhered to in its spirit.
IPP cell should also ensure that before processing the surrender request under theEXECUTIVE DIRECTOR (CRM)
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