LIC introduces new pension plus plan. Know details

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NEW DELHI: Life Insurance Corp. of India has introduced New Pension Plus effective 5 September. This is a non participating, unit Linked, individual pension plan that helps build a corpus by systematic and disciplined savings which can be converted into regular income by purchase of an annuity plan on completion of term.

The plan can be purchased either as a single premium payment policy or regular premium payment. Under the regular payment option, the premium shall be payable over the term of the policy. The policyholder shall have option to choose the amount of premium payable and the policy term subject to minimum and maximum limits of premium, policy term and vesting age. An option shall also be available to extend the accumulation period or deferment period within the same policy with the same terms and conditions as the original policy, subject to certain conditions.

The policyholder has a choice of investing premiums in one of the four types of funds available. Each premium paid by the policyholder shall be subject to premium allocation charge. The balance amount known as allocation rate constitutes that part of premium which is utilised to purchase units of a fund chosen by the policyholder. Four free switches for change of funds in a policy year are available.

Guaranteed additions will be payable under an in-force policy as a percentage of one annual premium. The guaranteed addition on regular premium ranges from 5.0-15.5% and on single premium payable up to 5% on completion of certain policy year. The amount of guaranteed additions shall be utilised to purchase units as per the opted fund type.

The NAV will be computed on a daily basis and will be based on investment performance, fund management charge of each fund type.

The life assured shall utilise the proceeds of the policy on vesting, i.e. at the end of the policy term, or on surrender/ on discontinuance as per the annuitisation provision. Partial withdrawal of units is allowed five years.

The plan can be purchased offline through agents, other intermediaries as well as online from the LIC website.

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