There are many people, who are holding the LIC policies. However, there are only a few, who know that we can pay LIC Premium Payment using EPF Corpus. We will see this feature in detail, in this article.
Paying the LIC Premium Payment using EPF corpus is a feature, which exists for a long time with EPFO. However, the reality is that only very few people are aware of this feature and are using it. The complete process is an automated process, where one has to just inform EPFO.
Features of paying LIC Premium using the EPF corpus
1) One can inform and instruct EPFO, at the time of Buying the Insurance Plan
It is not a mandatory requirement that one must already hold a LIC Policy. One can instruct EPFO at the starting stage (At the time of buying the LIC Policy) that to pay the LIC Premium using EPF corpus.
2) One can instruct the EPFO to pay for the Existing LIC Policies.
If one is already holding the LIC Policies, then he/she can instruct EPFO to pay the premium for the existing LIC Policies.
3) The Policy will turn Unpaid if there is a lack of sufficient funds
In case, when the funds are insufficient to pay for the LIC premium by EPFO corpus, then EPFO will not pay and will stop paying the premium. In that case, it will be the responsibility of the policy holder to pay for the premium. If a person fails to pay the premium, the policy may get lapsed also.
4) This facility will be active, as long as there is sufficient funds in your EPF account
The EPFO will pay for the LIC Premium using the EPF Corpus, as long as there are funds available in the account. In the case of shortage of funds, it will be the responsibility of the Policy holder to pay the premium of the LIC policies.
5) One has to assign the policy to the Central Board of Trustees in EPFO
This is the rule that the policy must be assigned to the Central Board of Trustees in EPFO. You have to follow this rule to avail this particular facility.
6) The EPF account should be at-least 2 years older
To utilize this facility, one should be a member of EPFO from at-least last two years. The new members of the EPF will not qualify to use this facility.
7) One is required to submit the form to the Employer
To avail this facility, the account holder must download the EPFO form 14 and submit it after completely filling it to the Employer.
In case of short financial hurdles, the LIC account holder can take the decision of paying the LIC premium payment by the EPF corpus. Under various situations, it can be a wise decision to pay the LIC premium utilizing the EPFO Corpus.