LIC Unveils Latest Single Premium Smart Pension Plan
LIC (Life Insurance Corporation of India) shares rose a little on Wednesday following the introduction of a new pension plan on Tuesday. The new plan, the Smart Pension Plan, allows individuals to pay a one-time premium now and then get periodic payments (an annuity) in their later years.
The policy has various annuity options, with options for individuals and couples. For couples, the annuity can be between spouses, siblings, parents/children, or even in-laws. With a single premium plan, you pay the premium once instead of some plans where you pay bit by bit.
High officials from the finance ministry and LIC introduced the Smart Pension Plan. It’s a “non-par” and “non-linked” plan, i.e., the benefits are guaranteed and fixed. It also provides some flexibility in the form of partial or full withdrawals under specific circumstances
The minimum purchase amount is ₹100,000, and you can choose to receive your annuity monthly, quarterly, half-yearly, or yearly. There are incentives for purchase amounts higher than this, LIC also mentioned.
Because it’s a “non-par” product, the returns are assured and fixed, so you will not get any bonus or share in any extra money LIC might earn. An annuity is simply a contract by which LIC promises to pay you periodically, either right away or sometime later. “Non-linked” and “non-participating” plans, like this one, generally give assured returns with lesser risk
The minimum purchase value is ₹100,000, and you can opt for receiving your annuity on a monthly, quarterly, half-yearly, or annual basis. There are incentives for values greater than this, LIC also stated. You can purchase this plan online (on www.licindia.in) as well as offline from LIC agents and other authorized dealers. The rates of annuity are guaranteed at the beginning of the policy.
Here are the main features and advantages summarized:
Single Premium: Pay a lump sum and enjoy lifetime benefits.
Different Annuity Choices: Select what suits you best.
Flexible: Plans for individuals and couples.
Guaranteed Returns: No bonus, but regular payments.
Liquidity Choices: Access to your funds if required.
Low-Cost Start: Minimum buy of ₹100,000.
Multiple Payment Choices: Select how frequently you receive payments.
Online and Offline Available: Convenient to buy.
Loan Option: You have the option of availing of a loan from your policy after three months.
Special Features: Available for subscribers to NPS and differently-abled persons.
The plan has varying payout options depending on what you select when purchasing it. If the person who is the intended recipient of the annuity passes away, the funds will be paid based on the option they had picked, which can be a lump sum, continued annuity payments, or in installments.
Since it’s a “non-par” product, the returns are guaranteed and fixed, so you will never receive any bonus or participate in any excess money LIC may make. An annuity is just an agreement by which LIC undertakes to pay you at regular intervals, either immediately or at some future time. “Non-linked” and “non-participating” plans, such as this one, typically offer guaranteed returns with lower risk.
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