LIC rolls out Smart Pension Plan. Key questions answered on retirement scheme

Life Insurance Corporation of India (LIC) has rolled out LIC New Smart Pension Plan. It is a non-participating, non-linked, individual, savings, immediate annuity plan. 

The new single premium immediate annuity plan offers a wide range of annuity options, from which policyholders can choose the ones that suit their needs, according to the official website of the state insurer.  

If, as an investor, you are contemplating investing in this retirement plan, here are some useful details.

Smart pension plan: Key Questions Answered

Can you buy it jointly with someone?

Yes, the Joint Life annuity can be taken between any two lineal descendants/ascendants of a family (i.e. grandparent, parent, children, grandchildren) or spouse or siblings or parent-in-law.

Is there a guarantee of annuity?

Yes, the annuity rates under all annuity options are guaranteed at the inception of the policy.

What are the different options available?

The different options available are liquidity, advanced annuity option and annuity accumulation option.

With regards to payment of death benefit, what are the options available?

Different options available for payment of death benefit are lumpsum death benefit, annuitisation of death benefit and in instalments.

What are the annuity options available?

Under single life, different annuity options—a total of 14—are available, including life annuity, annuity certain for five years and life thereafter, annuity certain for 10 years and life thereafter, and so on.

Under joint life, there are seven different annuity options available.

Can you change the annuity option?

No, the annuity option, once chosen, cannot be altered.

What are the minimum and maximum purchase price?

The minimum purchase price is ₹1 lakh and there is no maximum limit.

What is the minimum annuity?

The minimum annuity is ₹1,000 per month, ₹3,000 per quarter, ₹6,000 per half year and ₹12,000 per annum.

What is the mode of payment of premium?

The insurance premium needs to be paid as a single premium. The available modes of annuity payment are yearly, half-yearly, quarterly, and monthly.