Formula: Total premium paid (exclusive of service tax)*
70%*number of remaining complete month of cover/total policy term in months
Example: A Term Insurance policy is bought for 20 years term
were the premium is paid for a limited period say, at 5 years Rs.2,00,000, and
10 years Rs. 1,00,000 of the term. If the policy is surrendered before the completion
of 10 years the surrender value would be nil. But if the same is surrendered
after the completion of 10 years the surrender value is as under:
Calculation:
Rs.3,00,000
(Total premium paid Rs.2,00,000 + 1,00,000)*70%*50%(remaining
term of the policy in percentage) = Rs.1,05,000
P.S: If the policy is surrendered within the premium payment period, no surrender value would be received.
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