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ECS facility for payment of premium was started in L.I.C. since March 2004. This is a facility by which premium is deducted by bank at pre-decided date and remitted to LIC.

LIC of India has migrated all its existing policies registered under the ECS mode of premium deductions to NACH mode with effect from November 09, 2016.

The National Payments Corporation of India (NPCI) has implemented an electronic payment service termed as National Automated Clearing House (NACH) is a funds clearing platform set up by NPCI similar to the existing ECS of RBI. RBI has mandated that all Merchants & Financial Institutions have to compulsorily migrate to NACH as ECS will be completely replaced by NACH.
Under the NACH system, mandate forms are to be submitted as hard copies at the servicing branch of LIC.

Conditions to avail this facility:

1. NACH facility can be availed at the time of inception of the policy or later after completion of policy.
2. In NACH (MLY) mode, 5% extra premium charged under normal Monthly mode is waived.
3. No receipts will be printed and dispatched for NACH (MLY) mode policies. Premium paid certificate can be obtained twice in a year from the servicing branch.
4. NACH mode of payment can be opted for all Inforce ULIP, Non-Ulip and Health policies as per plan conditions.
5. NACH mode is not allowed for E-term Policies.
6. To opt for NACH facility the next premium must be due at least after 1 month from the date of exercising the option of NACH facility.
7. Arrears of premiums cannot be collected through NACH.
8. Under the policies registered under NACH mode, premium cannot be paid through any other payment channel except in case of NACH dishonor.
9. If NACH debit to customer’s bank is dishonoured , deduction will automatically stop for the further dues until the premiums that have fallen due are paid at LIC Branch / premium Point/LIC customer portal.
10. Debit dates allowed are 7th, 15th, 22nd and 28th of the month.

Debit dates are calculated automatically on the basis of Date of commencement as follows :

Date of CommencementDebit Date
1st to 7th7th of the same month
8th to 15th15th of the same month
16th to 22nd22nd of the same month
23rd to 28th28th of the same month

How to avail this facility:

1. NACH mandate form, duly signed by the account holder should be submitted along with cancelled cheque leaf/copy of passbook for validation of bank details of account holder.
2. There will be a separate mandate for each policy.
3. For NACH monthly mode cases, two installments of premium will be collected for New policies. These will be in addition to the premium installments for back dating cases.
4. All NACH mandate forms submitted by customers at the LIC Office will be sent to LIC’s NACH “Sponsor Bank” for scanning.
5. Sponsor Bank will upload the scanned images on the NPCI platform.
6. The customer’s bank will validate the credentials from the image of the NACH mandate with the customer’s details in the database of the Bank.

If found valid, the customer’s bank will accept the NACH mandate received from the customer and SMS conveying acceptance of the customer’s NACH mandate for inclusion in the process of debiting all future premiums due under a given policy under NACH process will be sent.

If the customer’s bank detects any discrepancy in the image of the NACH mandate of the customer, customer will be informed of the rejection status through SMS on the registered mobile number in LIC’s database. In such rejections, fresh NACH mandate is to be submitted to LIC Branch after taking necessary corrective action.
7. For change in Bank details, fresh mandate form (fulfilling the conditions in point 1) should be submitted to the servicing branch.
8. Policy holder should ensure that sufficient funds are available in the bank account at the time of debit date and mandate is not dishonoured.
9. Any dispute regarding dishonor should be taken up with the customer’s bank only.
10. This facility of easy premium payment can be availed of not only in respect of the policies of self but also on the policies issued on the lives of the spouse and children.

NACH Dishonour:
For the NACH dishonours, LIC sends a letter to the policy holder intimating the dishonour with reason. If the reason is Insufficient funds/Account Closed, dishonour charges of Rs. 125/- will be payable in addition to the due premiums and late fee (if applicable) with GST.

If NACH is dishonored twice for the reason Account Closed or No Such Account, no further Debit will happen unless fresh NACH mandate is submitted to LIC servicing Branch.