LIC Premium Payment Modes - Yearly vs Half-Yearly vs Monthly (Which is Better?)

When you buy an LIC policy, you choose a premium payment mode: yearly, half-yearly, quarterly, or monthly. This choice affects your total annual outgo more than most people realise.

**How premium modes work:** LIC uses a base annual premium. For other modes, it applies a loading factor:

| Mode | Effective annual cost | Loading | |------|----------------------|---------| | Yearly | 100% (base) | None - get rebate | | Half-yearly | ~102% | Small loading | | Quarterly | ~104% | Moderate loading | | Monthly | ~108% | Highest loading |

**SA rebate (applies in yearly mode):** - SA ₹2L to ₹5L: ₹2/1000 rebate - SA above ₹5L: ₹3/1000 rebate

**Practical example - Jeevan Anand (914), Age 35, SA ₹5L, Term 20 years:** - Yearly: ₹32,400/year (total outgo) - Half-yearly: ₹16,750 × 2 = ₹33,500/year (+3.4%) - Quarterly: ₹8,500 × 4 = ₹34,000/year (+4.9%) - Monthly: ₹2,880 × 12 = ₹34,560/year (+6.7%)

**Over 20 years, the difference:** - Yearly vs Monthly: ₹34,560 - ₹32,400 = ₹2,160/year × 20 = ₹43,200 extra

**Which mode to choose:** - Yearly: Always best financially if you can manage the lump sum - Half-yearly: Good balance between cost and cash flow - Monthly: Use UPI AutoPay - most convenient, but costs most

Call 9415313434 to get exact premium breakdown for your plan.