LIC Saral Pension plan: Here’s everything you need to know

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State-owned Life Insurance Corporation of India (LIC), which commands more than 66% market share , on July 1 launched a new pension plan named ‘Saral Pension’. It is a standard, individual, single premium, annuity plan.

This annuity plan is designed as per the guidelines of Insurance Regulatory and Development Authority of India (IRDAI). It offers the same terms and conditions across all the life insurers.

Features

Minimum age at entry: 40 years

Maximum age at entry: 80 years

Minimum annuity: Rs 1,000 per month (Rs 12,000 per annum)

Maximum annuity: No Limit

Minimum purchase price: Will depend on minimum annuity

Maximum purchase price: No Limit

Type of annuity

The policyholder can choose the type of immediate annuity from two available options:

Option 1 (single Life): Life Annuity with return of 100 per cent of purchase rate.

Option 2 (joint life): Joint last survivor annuity with return of 100% of purchase on death of the last survivor.

The annuity rates are guaranteed at the inception of the policy and annuities are payable throughout the lifetime of annuitant(s).

Rebates

Under this plan LIC announced incentives for high purchase prices. There is also a chance to get a rebate if any customer can buy it through online mode without any involvement of agent or intermediary or Point of Sales Person-Life Insurance (POSP LI).

Benefits

Option 1 (single life): The purchaser will continue getting annuities as long as he/she is alive. On his/hers death the nominee/legal heirs will be paid the full purchase price.

Option 2 (joint life):

Is the case of joint life, there are two type of death benefit options:

a) On the first death: 100% of the annuity payments shall continue to be paid as long as one of the annuitants is alive.

b) On the death of the last survivor: the annuity payments will be stopped and 100% of purchase price will be payable to nominee or legal heirs.

Maturity benefit

There is no maturity benefit under this scheme.

Policy loan

Policy loan facility also available after the six months from the policy commencement date.