Retirement is one of the most important decision in anyone's life. It needs proper planning both financially and emotionally. One of the important factors that one has to consider while planning for retirement is the lack of regular income. When a person decides to retire, the first thing that gets affected is his/her regular income. Investing is a excellent pension plan is therefore very necessary.
To help people plan their retired life better and to give them an opportunity to create an excellent investment portfolio, LIC has introduced the “Pension Plus Plan”. This is a unit-linked deferred pension plan. This pension policy does not have a life cover but comes with a minimum guarantee on the gross premium paid by the policyholder. Under the LIC Pension Plus Plan, policyholders can choose to invest in any one of the two types of investment fund options available.
To buy the LIC Pension Plus Plan, one has to meet the eligibility criteria set by the insurer.
|Plan Type||Non-unit deferred pension plan|
|Minimum Entry Age||18 years|
|Maximum Entry Age||75 years|
|Minimum maturity Age||40 years|
|Maximum maturity age||85 years|
Sum Assured – It is the amount that is received by the insured person at the time of maturity. In case the insured individual encounters death and the LIC Pension Plus Plan is still active, the sum assured is received by the legal heir or a nominee assigned by the insured.
|Minimum Deferred Term||10 years|
|Premium Payment Frequency||Yearly, half-yearly, quarterly, and monthly|
The following conditions are covered by the LIC Pension Plus Plan:
|Guaranteed Maturity Proceeds||Under the LIC Pension Plus Plan, if the policyholder has paid all the due premiums till the maturity of the loan, at the end of every financial year, a guaranteed interest will be accrued on the gross premium. The guaranteed interest rate will be as per the last working date in the month of June, September, December, and March of the preceding year. The guaranteed interest rate will be 50 basis points above the current reverse repo rate. The guaranteed interest rate can range between 3% and 6% p.a.|
|Guaranteed Interest Rate on Discontinued Policy Fund||Also, under this plan, a minimum interest rate of 3.5% p.a is guaranteed which will be credited to the discontinued policy fund.|
|Additional Premiums||Under this plan, a policyholder will have an option to make additional premiums in multiples of Rs.1,000 any time during the term of the policy. However, top-up option will not be available during the last 5 years of the policy.|
A rider or an add-on can be purchased by a policyholder by paying an additional amount for extra protection. A rider will cover those expenses which are usually not covered under the base plan. Currently, no information is available about the riders that can be attached under the LIC Pension Plus Plan. However, you may contact LIC directly to check if you may attach any add-ons under this plan.
Currently, there are no exclusions listed under this plan.
|Switching||At anytime during the term of the policy a policyholder can switch between the two fund types.|
|Partial Withdrawals||No partial withdrawals are allowed under this plan.|
|Revival||If a policyholder fails to make a payment within the grace period, the insurer will send a notification to revive the policy within 30 days from the date of receipt of such notice.|
|Reinstatement||A surrendered policy cannot be reinstated under this plan.|
|Cooling-Off Period||Once the policyholder get this plan, he/she will have 15 days cooling-off period within which the policyholder can return the plan if they are not satisfied with the terms and conditions of the plan.|
|Loan||No loans are available under this plan.|
|Assignment||Assignment option is not available under this plan.|
Under this plan, tax benefits are available under Section 80C and Section 10(10D) of The Income Tax Act, 1961.
Life Insurance Corporation of India is one of the leading insurance provider in India. Headquartered in Mumbai, this state-owned insurance company is one of the largest insurance provider in the country. Founded in the year 1956, over 245 insurance bodies were merged to make it LIC. From group insurance plans to individual life insurance plans, LIC offers it all. It is one of the most trusted brand in the insurance industry in India.