Question: I paid only one year's premium on a traditional endowment policy in India and now want to discontinue it. A colleague who surrendered a similar policy after just one premium a couple of years back says he got nothing back. Is he correct?
Answer: Yes, he's likely correct for his situation. Under the old IRDAI rules (pre-October 2024), there was no surrender value in case the policy is surrendered during the first year, so if he bought and surrendered before the new norms kicked in, getting nothing matches the old regime. But this doesn't apply to you — the new rules effective October 1, 2024 require insurers to pay surrender value after just one premium, for policies issued on or after that date. Check your policy's issue date to confirm which regime applies to you.

Supporting evidence:
title: irdai.gov.in/56f5b93b-a7c6-30cf-1734-0537e2d8676d
quote: SSV calculated as above shall become payable after completion of first policy year provided one full year premium has been received:
context: including surrendering policyholders and continuing policyholders.
- 26.4. Special Surrender Value (SSV):
- 26.4.1. Insurers, while determining the SSV as per the provisions of clause 4 of Schedule I of IRDAI (Insurance products) Regulations, 2024, shall ensure that such SSV shall be at least equal to the expected present value of the
- (a) paid-up sum assured on all contingencies covered and
- (b) paid-up future benefits (such as income benefits), if any, and
- (c) accrued/vested benefits, duly allowing for survival benefits already paid (what so ever name called), if any.
- 26.4.2. SSV calculated as above shall become payable after completion of first policy year provided one full year premium has been received: Provided for policies with limited premium payment term of less than 5 years and single premium policies, SSV shall become payable immediately after receipt of first full year premium or single premium, as applicable.
- 26.4.3. The paid-up sum assured and paid-up future benefits as referred in the para 26.4.1 above:

26. Surrender Value:

- 26.4.3.1. shall be calculated as per clause 4(A)(7) of Schedule I of IRDAI (Insurance products) Regulations, 2024 for other than single premium policies. Single premium policies shall be considered as fully paid up for this purpose.
- 26.4.3.2. The rate of interest used to calculate such expected present value shall not be more than the prevailing yield on 10 Year G-Sec with a spread of not exceeding 50 basis points.
- 26.4.4. The applicable SSV shall be reviewed annually based on the prevailing yield on 10 Year G Sec and the underlying experience.
- 26.5. Benefit Illustrations: Policy year wise GSV, SSV and Surrender Values payable shall be separately stated in the benefit illustration.

26.6. Other provisions :

- 26.6.1. Insurers shall examine the existing products on sale and carry out necessary changes to the surrender values, if any, by ensuring that surrender values payable to policyholders/beneficiaries is in compliance with the provisions of this master circular and IRDAI (Insurance Products) Regulations, 2024. The modification of existing products can be carried out following the extant norms of product filing procedure.
- 26.6.2. Under non-linked product structure, insurers may move towards products which provide transparency, flexibility and are simple to understand in terms of benefit structure and returns payable to policyholders/beneficiaries.
27. Loans: All non-linked savings products offering