29 Mar 2020
Pension plans, also known as retirement or annuity plans, are an ideal choice for policy buyers who wish to secure their post-retirement life. Generally, most pension plans are single premium policies, thus enabling the policy buyer to purchase the plan by paying a lump sum, one-time premium to the insurer. The insurer then provides annuity payments throughout the lifetime of the policyholder, after their retirement.
The top 10 pension plans that are available for purchase in India are:
The Saral Pension Plan from SBI Life is an individual, non-linked, participating, traditional pension policy, which offers financial security to policyholders by providing annuity payments and bonuses.
Features and Benefits of SBI Life Saral Pension Plan:
- A vesting benefit, which will amount to the full sum assured, Vested Simple Reversionary Bonus, and Terminal Bonus, will be paid upon the policyholder attaining the vesting age.
- A death benefit will be paid if the policyholder passes away.
- Guaranteed bonuses will be paid to the policyholder, as per schedule.
- Policyholders can customise their policy by purchasing the SBI Life – Preferred Term Rider.
- The minimum and maximum ages at entry are 18 years and 65 years, respectively.
- The policy buyer can choose a policy tenure between 10 years to 45 years.
- One can opt for a sum assured starting from Rs.1,000.
- Premiums start at Rs.7,500 p.a.
The Freedom Plan from Tata AIA Life Insurance is a participating, non-linked, endowment policy that is ideal to help secure your retirement years. This policy comes with two retirement age options, thus giving policy buyers the option to choose a retirement age as per their needs.
Key Features of Tata AIA Life Insurance Freedom Plan:
- In order to purchase this policy, prospective buyers need to be over 25 years of age.
- The policy term will vary based on the retirement option that you choose and your age at entry.
- Premiums can be paid annually, semi-annually, or on a monthly basis.
- The minimum basic sum assured that will have to be chosen under this policy is Rs.2 lakh.
The Smart Monthly Income Plan is a non-participating, unit-linked, life insurance policy that provides guaranteed monthly income to policyholders for a period of 15 years, starting from the 11th policy year, thus helping policyholders meet their retirement needs.
Key Features of Canara HSBC OBC Life Insurance Smart Monthly Income Plan:
- Individuals between 18 years and 55 years can purchase this policy.
- The minimum maturity age for this policy is 43 years, while the maximum is 80 years.
- Policy buyers can opt for a policy term of 25 years. The premium payment term is 15 years.
- The minimum monthly income payable is Rs.2,000.
- The sum assured will be equal to 100 times the monthly income chosen by the policyholder.
The Forever Young Pension Plan from Max Life Insurance is a unit-linked, non-participating, retirement policy. In addition to the vesting benefit, this policy also pays a death benefit if the policyholder happens to succumb to an untimely death during the premium-payment years. Further, loyalty additions will also be paid starting from the 10th policy year.
Key Features of Max Life Forever Young Pension Plan:
- Individuals between the age of 30 years and 65 years can purchase this policy.
- Premiums can be paid as a one-time lump sum amount or throughout the policy tenure.
- The minimum policy term that an individual is required to opt for when purchasing this policy is 10 years. The maximum policy term that can be opted for is 75 years minus the policyholder’s age at entry.
- Policy buyers can purchase the Max Life Partner Care Rider along with this policy.
LIC Jeevan Akshay – VI Plan
The Jeevan Akshay – VI Plan from LIC is an immediate annuity plan, which can be purchased by paying a one-time, lump sum amount. The plan guarantees flexibility in terms of annuity payments.
Features and Benefits of LIC Jeevan Akshay – VI Plan
- Policyholder can choose the type of annuity he/she wishes to receive, when purchasing the policy.
- The minimum purchase price when buying the plan through offline channels is Rs.1 lakh, whereas the minimum purchase price when buying the policy through online channels is Rs.1.5 lakh.
- Policy buyers are not expected to undergo a pre-policy medical examination before purchasing the plan.
- There is no maximum limit for the purchase price/annuity, under this plan.
- The minimum age at entry is 30 years and the maximum age at entry is 85 years.
The Pension Guaranteed Plan from HDFC Life is a non-participating, single premium, non-linked, annuity/retirement policy. The key benefit of this policy is that it comes with a range of annuity options to cater to the various needs of different policy buyers.
Key Features of HDFC Life Pension Guaranteed Plan
- This policy can be purchased on a single or joint life basis.
- Policy buyers can opt for immediate or deferred annuity.
- The minimum age at entry for this policy will vary based on the plan option chosen. The maximum age at entry is 85 years.
- Policyholders can choose to receive annuity on an annual, bi-annual, quarterly, or monthly basis.
- For group policies, the minimum group size required is 5 members.
The Insta Pension Plan from Aegon Life Insurance is an annuity plan, wherein policy buyers can select either one of the two annuity payout options offered by the insurer. The key benefit of this policy is that it has the provision of providing both the policyholder and his/her spouse a guaranteed income for life, based on the annuity payout option chosen at the time of purchasing the policy.
Key Features of Aegon Life Insta Pension Plan
- This policy can be purchased by individuals between the age of 50 years and 75 years.
- If you are opting for the Joint Life Annuity option, your spouse will have to be between the age of 50 years and 75 years.
- The minimum premium payable for this policy is Rs.1 lakh.
- In order to purchase this policy, a single premium will have to be paid.
The HDFC Life Assured Pension Plan – ULIP is a unit linked plan, which offers policyholders market-based returns and loyalty additions.
Features and Benefits of HDFC Life Assured Pension Plan – ULIP
- Policyholders are assured loyalty additions/pension multipliers from the 11th policy year onwards.
- Policy buyers between 18 – 65 years can purchase this plan.
- The minimum age at vesting is 45 years, and the maximum age at vesting is 75 years.
- A death benefit will be paid to the nominee if the policyholder succumbs to an untimely death.
- The minimum premium is Rs.2,000, which is payable under the monthly mode of premium payment.
- Policyholders can defer their vesting date any number of times, provided it is within the maximum vesting age of 75 years.
The Golden Years Retirement Plan from Exide Life Insurance is a traditional, variable, non-participating, pension policy. This policy provides a guaranteed death benefit to the nominee if the policyholder passes away during the policy term. After the date of vesting, a guaranteed vesting benefit is offered by the insurer.
Key Features of Exide Life Golden Years Retirement Plan
- To be eligible to purchase this policy, individuals will need to be between 18 years and 65 years.
- The minimum single premium payable is Rs.2,40,000.
- Policyholders can pay their due premiums on a yearly or monthly basis.
- Annuity payments are guaranteed for life.
- Policyholders can pay top-up premiums if they wish to increase their corpus.
The Bajaj Allianz Pension Guarantee Plan is a non-linked, non-par, immediate annuity plan, which provides policyholders a steady and regular source of income during their post-retirement years.
Features and Benefits of Bajaj Allianz Pension Guarantee Plan
- The insurer offers 6 types of annuity options.
- The minimum age at entry is 37 years. (The minimum age at entry for Annuity Option B is 0 years).
- The minimum purchase price for this policy is Rs.25,000. There is no maximum purchase price.
- The minimum annuity instalment, under the monthly mode of payment, is Rs.1,000.
- Policyholders can choose between 4 annuity payment frequencies, i.e., monthly, quarterly, half-yearly, and yearly.
The Easy Retirement Plan from ICICI Prudential is a unit-linked insurance plan, which enables policy buyers to be financially independent even after their retirement.
Features and Benefits of ICICI Pru Easy Retirement Plan
- Policyholders can choose to invest in funds, as per their risk appetite.
- The policyholder’s savings are protected from adverse market conditions through an Assured Benefit.
- To purchase this policy, one needs to pay a minimum premium amount of Rs.48,000.
- Premiums can be paid on an annual, bi-annual, or monthly basis.
- Anyone who is 35 years or older can purchase this plan. The maximum age at entry is capped at 70 years.
- Policyholders can opt to receive pensions starting from 45 years but not later than 80 years of age.
- Policyholders can choose a tenure of 10, 15, 20, 25, or 30 years.
The Retire Rich Plan from Bajaj Allianz is a unit-linked pension plan that offers policyholders/nominees a range of benefits including a vesting benefit, death benefit, surrender benefit, etc.
Features and Benefits of Bajaj Allianz Retire Rich Plan
- Policyholders are offered a guaranteed vesting benefit upon them attaining the vesting age.
- A guaranteed death benefit is paid to the nominee if the life assured meets with an unfortunate eventuality.
- Policyholders can choose the regular, single, or limited premium payment option.
- Policyholders are given the option to change their premium payment term and the option to pay top-up premiums.
- Loyalty additions are paid from the 11th policy year onwards.
LIC’s New Jeevan Nidhi Plan
The New Jeevan Nidhi Plan from LIC is a conventional, ‘with profits’, pension plan that offers policy buyers both savings cum protection features, in one plan.
Features and Benefits of LIC’s New Jeevan Nidhi Plan
- A risk cover against death is provided during the deferment period.
- Upon the life assured attaining the vesting age, the insurer will start providing annuity payments.
- Additional bonuses and accrued guaranteed additions are payable, as per schedule, to the policyholder as part of the vesting benefit.
Policy buyers can purchase LIC’s Accidental Death and Disability Benefit Rider to enhance the coverage offered by the base policy.
- The minimum basic sum assured under this plan is Rs.1 lakh for Regular Premium Policies and Rs.1.5 lakh for Single Premium Policies.
- The minimum entry age is 20 years.
The Smart Pension Plan from Reliance Nippon Life is a unit-linked, non-participating, pension plan that guarantees market-linked returns and helps policyholders build a long-term corpus for their post-retirement life.
Features and Benefits of Reliance Nippon Life Smart Pension Plan
- Policy buyers can opt for a policy tenure between 10 and 30 years.
- Insurer pays Guaranteed Loyalty Additions, which can help enhance one’s retirement corpus.
- Top-up premiums can be paid at any time.
- Policy buyers can choose a vesting age between 45 to 75 years.
- Prospective policy buyers have to be between the ages of 18 years and 65 years in order to purchase this policy.
- Premiums can be paid on an annual, bi-annual, quarterly, monthly, or single frequency.
ABSLI Empower Pension Plan
The Empower Pension Plan from Aditya Birla Sun Life Insurance is a unit linked, non-participating, life insurance pension plan. The plan provides a host of benefits, such as Guaranteed Additions, Vesting Benefit, Death Benefit, etc.
Features and Benefits of ABSLI Empower Pension Plan
- Any individual between the ages of 25 and 70 years can purchase this plan.
- One can opt for an accumulation period between 5 and 30 years, subject to a maximum vesting age of 80 years.
- Policyholders can opt to invest in a fund, based on their appetite for risk.
- The basic premium can be paid on a monthly, quarterly, half-yearly, or yearly basis.
- Policyholders can avail tax benefits under Section 80CCC and Section 10(10A) of the Income Tax Act, 1961.
The HDFC Life Click 2 Retire Plan is an online, unit linked, pension plan that will provide regular payouts during your post-retirement years and help you achieve any goals that you might have for the golden years of your life.
Features and Benefits of HDFC Life Click 2 Retire Pension Scheme
- This insurance plan is available for purchase online.
- Prospective policy buyers need to be over the age of 18 years to purchase this policy.
- A vesting benefit will be provided to you at the end policy term.
- The policyholder can choose to defer the vesting date.
- The nominee will be provided a death benefit if the policyholder passes away during the policy tenure.
- Policyholders can opt to invest in a fund of their choice.