What will change for Life Insurance Policies from 1 January in LIC

Agents are spreading the rumors to generate more sales before 1 January 2013. but in actually Insurance Policies will become more customer Friendly after 31 December. Below are some changes:

1. High Surrender Value: Till now if you cancelled a policy prematurely, the surrender value was calculated without taking into account the first years premium. the new rules says that the surrender value must be at least 30% of the total premium paid.
2. Shorter Minimum Period: Currently, you have to pay at-least 3 annual premiums to eligible for surrender value. after the IRDAs new rule, those policies who are having premium paying term less than 10 years can surrender after 2 years and more than 10 years premium paying term policy will have same 3 minimum years.
3. Higher Insurance Cover: If the Policyholder is upto 45 years old, the insurance cover must be atleast 10 times the annual premium. for those above 45, the cover can be up to 7 times the annual premium.
4. Lower Commission for Agents: Now it will depend upon the premium paying term.
   8 Years PPT – 24% Commission for 1st year.
   10 Years PPT – 30% Commission for 1st year.
   12 Years and More PPT – 35% Commission for 1st year.
5. Lower Premium for LIC: Now Term insurance premium will be cheaper than earlier it was.