Pension Plans for Seniors

Other than ensuring good health what are the things that elders must ensure while planning for the future?
The three most important things that one must remember while planning for the future are:

1) to invest one’s money safely,  2)insure oneself for medical benefits and  3)Write a Will.

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You can also opt for Pension plans available in the market. Today we will discuss about LIC India’s pension plan specially meant for Senior Citizens. Pension Plans are Individual Plans that gaze into your future and foresee financial stability during your old age. These policies are most suited for senior citizens and those planning a secure future, so that you never give up on the best things in life.

 

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Pension Plans from LIC:

Pension Plans – Jeevan Akshay VI ( UIN – 512N234V04 )

It is an Immediate Annuity plan, which can be purchased by paying a lump sum amount. The plan provides for annuity payments of a stated amount throughout the life time of the annuitant. Various options are available for the type and mode of payment of annuities.

Options Available:

The following options are available under the plan

  • Type of Annuity:
    • Annuity payable for life at a uniform rate.
    • Annuity payable for 5, 10, 15 or 20 years certain and thereafter as long as the annuitant is alive.
    • Annuity for life with return of purchase price on death of the annuitant.
    • Annuity payable for life increasing at a simple rate of 3% p.a.
    • Annuity for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant.
    • Annuity for life with a provision of 100% of the annuity payable to spouse during his/her lifetime on death of the annuitant.
    • Annuity for life with a provision of 100% of the annuity payable to spouse during his/ her life time on death of annuitant. The purchase price will be returned on the death of last survivor.

You may choose any one. Once chosen, the option cannot be altered.

Mode:

  • Annuity may be paid either at monthly, quarterly, half yearly or yearly intervals. You may opt any mode of payment of Annuity..

Salient features:

    • Premium is to be paid in a lump sum.
    • Minimum purchase price :
      • Rs.100,000/- for all distribution channels except online.
      • Rs.150,000/- for on line sale.
    • No medical examination is required under the plan.
    • No maximum limits for purchase price, annuity etc.
    • Minimum allowed age at entry is 30 years (completed) and Maximum allowed age at entry is 85 years (completed).
    • Age proof necessary.

Website to visit for more info: http://www.licindia.in/jeevan_akshay_plan_009_features.htm

 

Pension Plans – LIC’s New Jeevan Nidhi (UIN: 512N271V02)

LIC’s New Jeevan Nidhi Plan is a conventional with profits pension plan with a combination of protection and saving features. This plan provides for death cover during the deferment period and offers annuity on survival to the date of vesting.

  1. Benefits:
  1. Benefit on Vesting:  Provided the policy is in full force, on vesting an amount equal to the Basic Sum Assured along with accrued Guaranteed Additions, vested Simple Reversionary bonuses and Final Additional bonus, if any, shall be made available to the Life Assured.

 

The following options shall be available to the Life Assured for utilization of the benefit amount.

  1. To purchase an immediate annuity

The Life Assured shall have a choice to commute the amount available on vesting to the extent allowed under Income Tax Act. The entire amount available on vesting or the balance amount after commutation, as the case may be, shall be utilized to purchase immediate annuity at the then prevailing annuity rates. Commutation shall only be allowed provided the balance amount is sufficient to purchase a minimum amount of annuity as per the provisions of section 4 of Insurance Act, 1938.

In case the total benefit amount is insufficient to purchase the minimum amount of annuity, then the said amount shall be paid as a lump sum to the Life assured.

The annuity shall only be purchased from Life Insurance Corporation of India.
or

  1. To purchase a new Single Premium deferred pension product from Life Insurance Corporation of India

Under this option the entire proceeds available on vesting shall be utilized to purchase a single premium deferred pension product provided the policyholder satisfies the eligibility criteria for purchasing single premium deferred pension product.

The Life Assured will have to intimate his / her intention to go for a particular option available on the date of vesting atleast six months prior to the date of vesting.

  1. Death Benefit:

Death during first five policy years: Provided the policy is in full force, Basic Sum Assured along with accrued Guaranteed Addition shall be paid as lump sum or in the form of an annuity or partly in lump sum and balance in the form of an annuity to the nominee.

Death after first five policy years: Provided the policy is in full force, Basic Sum Assured along with accrued Guaranteed Addition, Simple Reversionary and Final Additional Bonus, if any, shall be paid as lump sum or in the form of an annuity or partly in lump sum and balance in the form of an annuity to the nominee.

In any case, provided all due premiums have been paid, the total death benefit at any time shall not be less than 105% of the total premiums paid (excluding taxes, extra premium and rider premium, if any).

The amount of annuity will depend on the payable lump sum and the then prevailing immediate annuity rates.

  1. Guaranteed Additions:  The policy provides for Guaranteed Additions @ Rs.50/- per thousand Basic Sum Assured for each completed year, for the first five years.

 

  1. Participation in profitsProvided the policy is in full force, depending upon the Corporation’s experience the policies shall participate in profits from 6th year onwards for a Simple Reversionary Bonus at such rate and on such terms as may be declared by the Corporation.

Final (Additional) Bonus may also be declared under the policy in the year when the policy results into a claim either by way of death or on vesting, provided the policy has run for certain minimum term.

  1. Optional Benefit:

 

LIC’s Accidental Death and Disability Benefit Rider:  LIC’s Accidental Death and Disability Benefit Rider is available as an optional rider by payment of additional premium under regular premium policies. In case of accidental death, the Accident Benefit Sum Assured will be payable as lumpsum along with the death benefit under the basic plan.  In case of accidental disability arising due to accident (within 180 days from the date of accident), an amount equal to the Accident Benefit Sum Assured will be paid in equal monthly instalments spread over 10 years and future premiums for Accident Benefit Sum Assured as well as premiums for the portion of Basic Sum Assured which is equal to Accident Benefit Sum Assured under the policy, shall be waived. If the policy becomes a claim either by way of death or the policy vests before the expiry of the said period of 10 years, the disability benefit instalments which have not fallen due will be paid in lump sum.

The Accident Benefit Sum Assured may be opted for an amount upto the Basic Sum Assured subject to minimum of Rs. 1,00,000 and maximum of Rs. 50 lakh (under individual as well as group policies with LIC of India). This benefit will be available only till the vesting age.

 

Website to visit: 

http://www.licindia.in/jeevan_akshay_plan_009_features.htm

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