Employees’ Provident Fund Organization i.e. EPFO Members, who have Life Insurance Corporation of India or LIC policy in their name, can use their EPF amount to pay their life insurance policy premium. Huh. According to Tax and Investment Expert, EPFO member can use his money in EPF account for LIC premium payment. Provided he has EPF balance of at least two years of LIC policy premium. According to experts, EPFO customers who have lost their jobs or are under financial stress due to any other reasons, they can avail this EPFO facility to continue their LIC policy with policy renewal payment from EPF account.
Form 14 has to be submitted
How EPFO member can use his EPF amount for LIC premium payment. According to Pankaj Mathpal, Founder and MD, Optima Money Managers, EPFO members can use their EPF amount for LIC premium payment. For paying LIC premium from EPF account, they have to submit Form 14 to EPFO. However, while submitting the Form 14 at the EPFO office, the EPF account holder should ensure that the EPF balance should be equal to the LIC premium amount for at least two years while submitting the Form 14.
These people can take advantage
Pankaj Mathpal of Optima Money Managers said that EPFO customers can avail this facility at the time of purchasing LIC policy or in the post LIC premium payment phase. So, if an EPF account holder is under financial stress due to the COVID-19 pandemic or any other reason, he can still renew his LIC policy by paying LIC premiums from his EPF accounts. He has to submit Form 14 to his nearest EPFO office.
lic policy renewal rule
According to tax and investment expert Jitendra Solanki, LIC allows its policyholders to renew their policy even on late payment of premium. As per LIC premium renewal rule, no late fine is levied on policy renewal after 6 months from the policy renewal date. On renewal of LIC policy after 6 months to 3 years from the date of policy renewal date, some late fine will have to be paid in addition to the policy premium. LIC policy becomes inoperative if a person fails to renew his policy after 3 years from the policy renewal date. He says that one should use their EPF amount for LIC premium payment only as the ultimate solution. If a member’s LIC policy is about to become inactive, in that case he can do so.