Typically, one should have paid at least three years' premium to the insurer and thereafter can opt for either one of the 2 above mentioned options for policies with a term of 10 years or more. For policies with a lesser term, at least two years' premium payment is mandatory. Nowadays, there are several policies where the premium paying term (PPT) is lesser than the policy's actual term. If the PPT is less than 10 years (even if the actual policy term is 25, 30 years), the policy will acquire a surrender value if the premium has been paid for at least two years. For single premium policies, the surrender value gets acquired after the first year itself. In case you haven't paid even 2 or 3 years' premium (as per the case above) and want to discontinue, the insurer will not pay you back anything and will not convert it into a paid-up policy either. The money is all but lost. So if you have already paid 3 years' premium, not paying any future premiums will convert the policy into a paid-up policy. You won't get any money back in the year you turn it into a paid-up policy but will have to wait till the policy's original maturity. Although the bonuses already attached to the policy will continue, the sum assured will reduce and will be called paid-up sum assured.
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