1. What is LIC Agent Commission?

LIC (Life Insurance Corporation) agents earn commission based on the premiums paid by policyholders. The commission rate varies depending on the type of policy and the policy term.

2. How Commission is Calculated

The basic commission formula is:

Where:

• Policy Premium — The premium amount paid by the policyholder (typically in INR)
• LIC Commission Rate — The percentage rate set by LIC for that policy type

Note: Commission rates are higher in the first year and reduce in subsequent years for most policies.

3. Commission Rate Structure

Details: LIC commission rates typically range from 2% to 35% depending on:

• Policy type (term, endowment, ULIP, etc.)
• Policy term (short-term vs long-term)
• Premium payment mode (yearly, half-yearly, etc.)
• Commission year (first year vs renewal)

4. Using the Calculator

Instructions: Enter the policy premium amount in INR and the applicable commission rate percentage. The calculator will compute the agent's commission.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical commission rate for LIC agents?
A: Rates vary but typically range from 2% for short-term policies to 35% for certain long-term policies in the first year.

Q2: Do agents get commission every year?
A: Yes, but renewal commissions are usually much lower than first-year commissions (typically 5-7.5% of premium).

Q3: Are commissions taxable?
A: Yes, agent commissions are taxable as income under the head "Profits and Gains from Business or Profession."

Q4: How often is commission paid?
A: Commissions are usually paid when the premium is received by LIC from the policyholder.

Q5: Can commission rates change?
A: Yes, LIC periodically revises commission structures. Always check current rates for accurate calculations.