LIC Lapsed Policy Revival Guide 2026: Costs, Documents, Timeframes

By Hari Kotian, IRDAI-Certified Insurance Advisor · 2026

LIC permits revival within 5 consecutive years from the first unpaid premium (FUPR). Beyond that, revival is impossible and only surrender remains. Policies lapsed 0-6 months usually qualify for simple revival with no medical examination.

What revival actually costs

The revival amount is outstanding premiums plus interest, typically around 9.5% per annum on arrears. No separate penalty applies for most policies - the interest is the cost.

Why revival beats surrender

Reviving a lapsed LIC policy restores your original premium rates, keeps your accumulated bonus intact, and protects tax benefits under Section 80C. Surrendering or buying fresh means higher premiums at your current age and a new waiting period on riders.