Attachment of lic policy - is it possible???
This query is : Resolved
CA Shruti Bhavsar
(Querist)
30 March 2012
Is it possible that a creditor can attach an LIC Policy of Debtor, if debtor is not able to pay the dues???
or attachment of LIC policy is not possible at all???
or attachment of LIC policy is not possible at all???
31 March 2012
A lien can be marked on a LIC Policy.
31 March 2012
Original LIC Policy can also be a Collateral security. But authorization should also be provided for this same as to be given for lien marking.
CA Shruti Bhavsar
(Querist)
02 April 2012
thanks sir.. but i am not clear. can u explain me in depth???
lien marking ... how it is possible??
lien marking ... how it is possible??
04 April 2012
***Assignment of LIC Policy Bond***
In case you are raising a loan against your policy from LIC or any other financial institution, your policy would have to be assigned to LIC or the financial institution.
When you assign the policy the title of the policy is shifted from your name to that of the institution.
The policy would be reassigned to you on the repayment of the loan.
A fresh nomination should be done after reassignment of the policy.
Assignment of policies can be done even when a loan is not required or for some special purposes (To learn more about assignment https://www.licindia.in/policy_conditions.htm#12 ).
In case you are raising a loan against your policy from LIC or any other financial institution, your policy would have to be assigned to LIC or the financial institution.
When you assign the policy the title of the policy is shifted from your name to that of the institution.
The policy would be reassigned to you on the repayment of the loan.
A fresh nomination should be done after reassignment of the policy.
Assignment of policies can be done even when a loan is not required or for some special purposes (To learn more about assignment https://www.licindia.in/policy_conditions.htm#12 ).
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CA Shruti Bhavsar
(Querist)
06 April 2012
ok i got it. but if an individual is indebted to other individual or firm, can they attach the LIC Policy??
in this case naturally there will no lien in the policy.
in this case naturally there will no lien in the policy.
07 April 2012
Here I'm not sure about legal position..
But being a CA, we can understand that in the eyes of law, a transaction will be similar for all..
Hence, if assignment of a insurance policy is allowable than it should be allowed for other than financial companies too...
I suggest to keep a promissory note from the indebted individual in this regard apart from taking assignment of policy's monitory benefits
But being a CA, we can understand that in the eyes of law, a transaction will be similar for all..
Hence, if assignment of a insurance policy is allowable than it should be allowed for other than financial companies too...
I suggest to keep a promissory note from the indebted individual in this regard apart from taking assignment of policy's monitory benefits
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