The entire fund value is paid to the policyholder if a ULIP is surrendered after the 5-year lock-in period. However, the process of surrendering the policy before 5 years is different. The amount will be paid to the policyholder only after the end of 5 years. However, the insurance provider will deduct discontinuance charges from the fund value. The balance is transferred to a Discontinued Policy (DP) fund and a fund management charge of not more than 0.5% is applied. The DP fund will earn interest over time to provide the minimum return guaranteed by the provider.