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Loan Against LIC Policy

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What is an LIC Loan?

LIC policy holders can avail loan against LIC policy by pledging their policy as collateral for loan amount of up to 90% of the policy’s surrender value. The interest rates are usually lower than the personal loan interest rates. The loan process is completely digital with minimal documentation required. You can consider opting for this loan under the following circumstances:

  • When you need immediate funds at a lower interest rate.
  • If you don’t have a very good credit score.

Interest Rates for Loan Against LIC Policy

Lenders Interest Rate (p.a.)
HDFC Bank 10.75% onwards
Axis Bank 11.50% onwards
State Bank of India 11.20%
ICICI Bank 10.75% - 11.75%
IDFC FIRST Bank 9.50%

Note: Interest rates may vary for different policies across lenders. Confirm the exact rates with the lender before applying.

Maximum Loan Amount for LIC Loan

The loan amount for an LIC policy depends on the borrower’s profile, lender’s policies and insurance policy’s value. Loan against LIC policy is offered for a loan amount of up to 90% of the policy’s surrender value. The ongoing policies (90%) have a higher percentage of surrender value as compared to the paid-up policies (85%).

Eligibility for LIC Loan

Eligibility criteria Details
Nationality Indian citizen
Applicant’s age Minimum 18 years
Eligible plans Jeevan Pragati, Jeevan Labh, New Endowment Plan, Jeevan Rakshak, Jeevan Lakshya
Minimum premium payment 3 years’ premium in full
Surrender value requirement The policy should have a guaranteed surrender value

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Documents Required

Below-mentioned are the documents required during a LIC loan application:

  • Duly filled application form.
  • ID proof (Aadhaar card, PAN, Voter ID).
  • Address proof (Utility bills, Aadhaar card, passport, driving license).
  • Original policy document.
  • Bank statement or passbook.

Also Check: Documents Requirements for Personal Loan

LIC Loan Repayment

  • You can repay the loan against the LIC policy by visiting the official website of Life Insurance Corporation of India.
  • The repayment can be done online either directly without logging in, or through the customer portal.
  • You can also visit the bank branch to make timely repayment.
  • You can repay the principal anytime, either in parts or in full. There is no fixed EMI schedule.
  • The interest on an LIC loan is generally payable half-yearly.
  • In case you fail to make the repayment, the outstanding loan amount and the accumulated interest are deducted from the policy at the time of policy maturity/surrender/death claim.

Benefits of Taking Loan Against LIC Policy

Below-mentioned are the benefits of taking a loan against an LIC policy:

  • The interest rate is lower as compared to personal loans.
  • The life insurance policy remains fully active.
  • It offers flexible repayment options, i.e. you can pay the interest component initially and the principal amount later.
  • Individuals with poor credit score can also avail a loan against an LIC policy.
  • Funds are disbursed very quickly.

Disadvantages of Taking Loan Against LIC Policy

Below-mentioned are the disadvantages of taking a loan against an LIC policy:

  • The interest is accumulated on the loan.
  • In case of repayment failure, the outstanding balance is deducted from the maturity amount or the death claim.
  • You need to pay LIC premium for at least 2-3 years before applying for the loan.
  • The loan can be availed only on a specific LIC plan.

Loan Against LIC Policy v/s Personal Loan

Loan Against LIC Policy Personal Loan
Secured loans Unsecured loan
Lower interest rates Comparatively higher interest rates
Loan amount offered up to 90% of the policy’s surrender value Loan amount depends on the repayment capacity of the applicant
The process is faster with flexible repayment options The process might take a little longer with monthly repayment options
The loan is offered to individuals with a poor credit score Applicants should have a high credit score, preferably 760 or above, to get their loans approved

LIC Policies Eligible for Loan Against LIC Policy

Below-mentioned are the eligible policies for LIC loan:

  • Jeevan Pakshak
  • Jeevan Pragati
  • Jeevan Laabh
  • Limited Premium Endowment Plan
  • New Endowment Plan
  • New Jeevan Anand
  • Single Premium Endowment Plan
  • Jeevan Lakshya
  • Limited Premium Endowment Plan
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What our customers say

Get My Personal loan disbursed

I would like to give a huge shoutout to Munni Nayak from Paisabazaar for her incredible support in helping me get my personal loan disbursed within just a few days. She was extremely cooperative throughout the entire process and demonstrated great knowledge by explaining every step in detail with patience and clarity. I truly appreciate her dedication, professionalism, and the smooth experience she provided. Thank you so much, Munni, for all your help and support!

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Preeti BhattMay 16, 2026

Smooth & hassle-free loan approval experience

I want to express my gratitude for your exceptional support & guidance throughout my loan application process to Aman (EW17239). Your professionalism & clear communication made the journey smooth and manageable. I appreciate how you helped during loan approval & fast-tracked the documentation. It is rare to find someone so committed to their clients. I truly value the effort you put into ensuring a successful outcome. Thanks again for your invaluable help.

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Sanjay Kumar GuptaMar 30, 2026

Exceptional guidance throughout the process

I’d like to express my sincere appreciation for Mr. Aman Kumar (EW32023) for the excellent assistance provided. His professionalism & willingness to help made the experience smooth & pleasant. Aman Kumar demonstrated patience & clarity while addressing queries and ensured that everything was handled efficiently. Such dedication & customer-focused service truly deserve recognition. Please convey my thanks and appreciation to him for his outstanding support.

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Jyotirmoy SinghaMar 23, 2026

Very helpful and easy to reach

I really wants to appreciate Mohankumar Dhandapani for closing my loan requirement in such a short time and nice manner. He is very much approachable helped me based on my requirements. He explained me all the options in very short time even one option failed immediately helped me to get other options worked. Excellent job done by Mohankumar Dhandapani all the best keep you same way approachable you will get more customers. Thanks to Paisabazar too.

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Kirubagaran GanesanFeb 24, 2026

Reliable help when i needed it most

I am writing this email to express my sincere thanks for your excellent support and guidance on Paisabazaar. My experience was very smooth and satisfying because of your help. You explained everything clearly and made the whole process easy and comfortable for me. I truly appreciate your professionalism, patience, and quick response. I am very happy with the service and would definitely recommend to others because of the great support I received from you. Thank you once again

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DharmeshFeb 22, 2026

Committed support that made everything easy

I’d like to appreciate the Paisabazar team for the excellent loan service. I especially want to recognize one of your agents, Mr. Prince Kumar, for his outstanding support. For more than a month, he continuously followed up with me and assisted me. His commitment & professionalism made the experience smooth & hassle-free. I appreciate his efforts and dedication. Kindly acknowledge his performance and consider rewarding such a sincere employee.

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BhupendraFeb 18, 2026

My Trust in Paisabazaar has Increased

I would like to take a moment to share my sincere feedback regarding the support I received from your team. The executive who assisted me was extremely professional, polite, and knowledgeable. They patiently understood my concern, explained the process clearly, and guided me step by step toward the right solution. I truly appreciate the transparency, timely responses, and genuine effort shown to help me.

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Lalit MaviFeb 12, 2026

Best Place for Taking Loans

I contacted customer care with a few queries, and I am very satisfied with the support I received. The representative was polite, patient, and explained everything clearly. My questions were resolved properly, and the overall experience was smooth and helpful. Thank you for the excellent customer service

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Kokil BarnwalFeb 12, 2026

Easy loan approval with good guidance

Thank you for the support provided for getting personal loan approval. During this process I worked with Mr. Aman Bajpai (EW17239) who was co-ordinator for this entire process of Personal loan, I was incredibly impressed by his efficiency and problem-solving skills. He went out of their way to ensure all my questions were answered and that the disbursement timeline stayed on track. His coordination was really appreciable.

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Riyaj AtarFeb 9, 2026

Apne higher education ke liye loan liya tha

Muhje higher education ke liye loan chahiye tha. Paisabazaar pe apply kiya. Got it at the right time. Quite helpful.

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Puja DanuJan 22, 2026
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Paisabazaar is a loan aggregator and is authorized to provide services on behalf of its partners.

The APR (Annual Percentage Rate) of a personal loan is its annualised cost of borrowing, which includes the interest rate as well as the processing fees, documentation fees and other fees charged during the loan origination. The APR is expressed in the form of a percentage and thus, allows personal loan applicants to detect personal loan schemes offered at lower interest rates but with higher processing fees and/or other charges.

The APR of personal loans usually ranges between 11.29% to 35%. For example, assume that you have availed a personal loan of Rs. 5 lakhs @ 10.50% p.a. with a repayment tenure of 5 years. The processing fee charged for this loan is 1.5% of the loan amount, which amounts to Rs 7,500. Therefore, the total borrowing cost of your personal loan will be Rs 1,52,317 and its APR will be 11.16%.

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