Lic Of India Reassignment Form 3857 _best_ <99% Validated>

Title: Understanding LIC Form 3857: The Essential Guide to Policy Reassignment

Life insurance policies are often taken out to secure the financial future of loved ones or to satisfy loan requirements. When a policy is pledged to a bank or financial institution to secure a loan, it is said to be "assigned" to that institution.

Once the loan is repaid, the policy does not automatically revert to the policyholder. A specific legal procedure must be followed to restore the policyholder's full rights. This procedure is known as Reassignment, and the document used to facilitate this in the Life Insurance Corporation of India (LIC) is Form 3857. lic of india reassignment form 3857

This article provides a comprehensive overview of LIC Form 3857, its purpose, and the step-by-step process for completing it.

Most Relevant LIC Form for Reassignment

The primary form used for transferring rights (reassigning) a life insurance policy to another person (e.g., a creditor, bank, or family member) is: Title: Understanding LIC Form 3857: The Essential Guide

• Form No. 3155 – Assignment of Life Insurance Policy (under Section 38 of the Insurance Act, 1938)

If you are reassigning the policy back to yourself after a loan is repaid, you would use:

• Form No. 3156 – Reassignment / Revocation of Assignment

These are the standard forms for reassigning policy ownership rights. Most Relevant LIC Form for Reassignment The primary

When to use

• To transfer an existing assignment to a different person/entity.
• To cancel an assignment (revert policy back to policyholder’s control or remove the current assignee).
• To modify assignment details where permitted by policy terms.

Who completes it

• Current assignee (if transferring) and/or policyholder, depending on the transaction.
• If the policy is jointly held or involves minors/incapacitated persons, relevant guardians or legal representatives must sign and submit supporting documents.

2. Obtaining the Form

The bank (Assignee) usually provides Form 3857. In some cases, the policyholder can download the standard form, but it must be executed (signed and stamped) by the Assignee (Bank).

Q5: Who pays stamp duty for reassignment?

In most states, reassignment for loan repayment is exempt from stamp duty. For other cases, nominal stamp duty of ₹10-₹100 may apply. Check your state’s Stamp Act.

The Step-by-Step Process for Reassignment

Reassigning a policy using Form 3857 involves coordination between the borrower, the lender, and LIC. Here is the typical workflow:

Why Should You Care? The Strategic Angle

Most policyholders ignore Form 3857 because they don't plan to give their policy away. But understanding this form opens up three powerful opportunities:

1. Better Loan Terms: Lenders love collateral. By officially assigning your LIC policy via Form 3857, you can often get lower interest rates on a loan than an unsecured personal loan.
2. Corporate Keyman Insurance: If you are a business owner and the company holds a "Keyman Insurance Policy" on you, Form 3857 is used to reassign the policy to you personally after you leave the company or retire.
3. Resolving Family Disputes: In a legal separation or divorce settlement, Form 3857 can be used to transfer a policy’s ownership to a spouse or child cleanly, without canceling the plan.