I need to raise a personal loan. Is it possible to use my life insurance policy as a collateral serurity for the loan liability.

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If you need to raise some cash, you may be able to borrow against your life insurance policy if it has a cash value, and enough equity to borrow against. If you don't have any equity in your policy, and your credit is not good, you can also get cash quickly with bad credit signature loans.

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I had taken a loan from my existing life insurance policy, which I repaid along with my quarterly premiums. Will my final returns from the policy be affected in any way?

Once you take a loan on a life insurance policy, it is independent of the returns under the policy.

Insurance companies charge interest on the amount of loan advanced against the policy. Once the principal amount along with the interest is repaid, it does not have any affect on the final returns of the policy.