FAQs for Policy Surrender

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What is surrender?

Surrender refers to early encashment of unit-linked policy for prevalent cash value of the policy. Full surrender of the policy terminates the insurance contract and the Company’s liability to pay any claim ceases. Please note that only Unit Linked policies can be surrendered.

What is payable at the time of surrender?

The amount payable upon surrender is the prevailing cash value of the policy i.e., cash value at the date all surrender requirements have been received at the Head Office.

How may I know the cash value of my policy?

You can determine the cash value of your policy at any time by simply multiplying the number of units allocated in your policy to the Bid Price of the fund your policy is linked to.

Mathematically,

Cash Value = Number of units x Bid Price of the Fund.
Let us assume, the total number of units allocated in your policy are 985.12. At a particular point of time Bid Price of the fund is Rs. 1, 200/-. Hence the cash value of the policy at that time would be:

Cash Value = 985.12 x 1, 200

= Rs. 1, 182, 144/-

When can I apply for surrender/partial surrender of my policy?

Generally, if a policy is surrendered prior to the payment of two full years’ premiums after commencement, no amount is payable by the Company.

In order to know if your policy is eligible for surrender, may we request you to refer to your Policy’s Provisions and Conditions which highlights the Clause regarding Policy Surrender.

What documents are required to process full ‘surrender’ of my policy?

In order to fully surrender your policy, the following documents would be required:

    • Surrender Form, duly filled in and signed by the policy holder
    • Original Policy Documents
    • Zakat Declaration (if you wish to apply for Zakat Exemption)

To get the ‘Surrender Form’, please call us at our Call Centre or download the same from our website.

Where should I submit my surrender requirements?

After completing the above requirements, you may send them directly to us at EFU Life Head Office on the following address:

Client Advisory Department

EFU Life Assurance Ltd

37-K Block 6, PECHS, Karachi- 75400

The same can also be submitted at any of the branch offices of our Company convenient to you.

However, if you have taken this policy through our bancassurance channel, we would request you to submit the requirements at the parent bank / branch from where the policy was taken.

How long does the full surrender procedure take?

Upon receipt of all requirements at EFU Life’s Head Office, the process may take 4-5 working days, after which the cheque will be ready for dispatch

What is the procedure for full surrender?

Once all the surrender requirements have been fulfilled, our Client Advisory Department may call you for verification. Once the verification is completed, the policy is surrendered on the Bid Price determined on the next valuation of Fund i.e., the Bid Price of the next day. The Bid Price is unknown in advance. The final surrender value payable is calculated by multiplying the number of units surrendered with the Bid Price.
Once the cheque has been made, the same will be sent to your correspondence address or local branch office of EFU, as per your wish.

I do not have any bank account in Pakistan. What should I do?

Personal bank account within Pakistan is mandatory. It is recommended to open up bank account in Pakistan to deposit the surrender Cheque if you do not currently have one.

My Original Policy Documents/Amended Schedule has been lost. What should I do?

In case of lost policy documents, we require Surrender ‘Indemnity Bond’ to be executed on Rs.100/- Stamp paper and attested by Oath Commissioner as a replacement of original policy documents. A sample of the said requirement can either be obtained from your respective servicing branch or by writing to us at csd@efulife.com.

Can any of my acquaintance collect the surrender cheque on my behalf?

Yes, any of your blood relative may collect the surrender cheque upon provision of an Authority Letter, duly signed by yourself. However, please note that the surrender cheque will only be issued on the name of Policy Holder.

Can you transfer the surrender value to my bank account directly?

Yes, there is a facility of transferring surrender value to your bank account directly. You may request for this special ‘Surrender Form’ by calling us at our Call Center or by writing to us at csd@efulife.com or at our Head Office address mentioned below:

Client Services Department

EFU Life Assurance Ltd

37-K Block 6, PECHS, Karachi- 75400

However, it is important that your bank offers this facility and is on 1 LINK Network such as (UBL, HBL, ABL etc.) The amount of bank transfer available is currently limited to a maximum of Rs. 250, 000/-. Hence, if the surrender amount is greater than Rs. 250, 000/- you may select ‘Cheque’ as mode of your payment.

To transfer the amount directly to your bank account, you may fill out the ‘For Online Payment’ section on the Surrender Form and get the same attested by your Bank Branch Manager. This section includes information such as Name, Bank Account, Branch, CNIC, Bank Name and Branch Code.

I applied for surrender of my policy; however, I have changed my mind now and do not wish to proceed with withdrawal. What should I do?

If the surrender is still in process, you may send us the request and we will be pleased to cancel the surrender status and continue your policy under the original terms.

What charges are deducted at the time of surrender?

A nominal Surrender Processing Fee of Rs. 500/- is deducted from the total cash value at the time of full surrender.

How much Zakat will be deducted from my cash value?

If you have submitted the Zakat Declaration form then there is an exemption from Zakat, else 2.5% of total cash value will be deducted from the cash value as Zakat.

Will taxes be deducted from my Surrender Value?

No, at present surrender value is given without deduction of any tax amount.

Can I send the scanned copies of the surrender requirements?

Yes, we can initiate the process upon receipt of scanned copies. However, physical / hard copies of all documents are required in order to complete the surrender process.

How the surrender amount will be given to me?

Upon surrender/partial surrender of your policy, a cheque crossed in favor of policy holder’s name and bank account number (to be mentioned on the Surrender Form) will be sent to you.

What is partial surrender?

Partial surrender refers to withdrawal of certain amount from policy’s cash value to meet personal / financial needs without terminating the policy.

What documents are required for partial surrender?

In order to partially surrender your policy, the following documents would be required:

  • Surrender Form, duly filled in and signed by the policy holder
  • Zakat Declaration (if you wish to apply for Zakat Exemption)

To get the ‘Surrender Form’, please call us at our Call Centre or download the same from our website.

What is partial surrender procedure?

Once all the partial surrender requirements have been fulfilled, our Client Advisory Department may call you for verification. Once the verification is completed, an Acceptance Letter indicating the revised Sum Assured is sent. Upon receipt of same, duly signed by you, your policy is partially surrendered on the Bid Price determined on the next valuation of Fund i.e., the Bid Price of the next day. The Bid Price is unknown in advance. The final partial surrender value payable is calculated by multiplying the number of units surrendered with the Bid Price.

Once the cheque has been made, the same will be sent to you on your correspondence address or local branch office of EFU, as per your wish.

Please note that on Partial Surrender, the sum assured of your policy will proportionally reduce (for certain plans). The good news is that you can request to restore the previous sum assured of your policy. In order for us to do the same, please send us a written request at our Head Office or call us at our Call Centre.


The cash value of my policy is below 20, 000/-. Can I apply for the partial withdrawal?

In order to avail partial surrender mechanism, it is required to leave a minimum of Rs. 20, 000/- in Cash Value, after the partial surrender. For example, if the cash value of your policy is Rs. 100, 000/-, you may partially withdraw the amount of upto Rs. 80, 000/-.

Can I pay back the amount withdrawn through partial surrender after a certain period of time?

Yes, you would be pleased to know that the amount withdrawn through partial surrender option may be invested as Fund Acceleration Premium in your policy (depending on the availability of this option in your policy) or by taking a new single premium plan.

How the Sum Assured decrease is determined at the time of partial surrender?

Sum Assured is decreased in proportion to the cash value withdrawn. Let us explain this by giving an example. The cash value of your policy 100, 000/- and Sum Assured of the main plan is 1, 000, 000/. If you withdraw 20 % of the total cash value that is Rs. 20, 000/-, the Sum Assured of your policy will also reduce by 20% i.e., will become 800, 000/-.

How can I apply for restoration of my policy’s Sum Assured?

You may either request for restoration on acceptance letter or later you may send us signed request for the same. Upon receipt of such request, we shall send you a letter for medical / non-medical requirements.

You can send us these requirements via email at csd@efulife.com or at our Head Office address mentioned below:

Client Services Department
EFU Life Assurance Ltd
37-K Block 6, PECHS, Karachi- 75400

The decision to restore the Sum Assured shall be taken once policy has been under-written upon receipt of the requested requirements. In most of the cases Sum Assured is restored, however, the same could be declined or extra-premium could be charged if any abnormality is found in the policy holder’s health or if the policy holder has reached 60 years of age.

What is the procedure for partial surrender in single premium policies?

Once all the partial surrender requirements have been fulfilled, the policy is partially surrendered on the Bid Price determined on the next valuation of Fund i.e., the Bid Price of the next day. The Bid Price is unknown in advance. The final partial surrender value payable is calculated by multiplying the number of units surrendered with the Bid Price.

Once the cheque has been made, the same will be sent to you on your correspondence address or local branch office of EFU, as per your wish.


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