All You Need To Know About LIC Senior Citizen Pension Scheme

The Life Insurance Corporation of India is a prodigious company that offers a spectrum of insurance products to people so that they can lead a healthy and tension-free life. LIC’s products are suitable for all people including senior citizens. The company has introduced various LIC Senior Citizen Schemes that are supported by the government of India. Senior people are more susceptible to various diseases.

Moreover, the falling rate of interest has also influenced the government to safeguard these senior citizens so that they can enjoy a wholesome life. The Life Insurance Company has launched several LIC pension plans for senior citizens under which these senior people can enjoy a regular income in the form of a pension.

Let’s consider various LIC Senior Citizen Saving Schemes.

1. LIC Pradhan Mantri Vaya Vandana Yojana

This is the best LIC policy for senior citizens. Introduced by LIC on 4th May 2017, this LIC senior citizen pension scheme is ideal for people above 60 years. The LIC Vaya Vandana Yojana interest rate is 8% for 10 years. This policy was available to purchase till 31st March 2020.

Some primary features of this LIC plan for senior citizens are:

• Anyone above 60 years can purchase this LIC Senior Citizen Scheme

• • LIC Pradhan Mantri Vaya Vandana Yojana offers a guaranteed pension for 10 years
  • The maximum investment for this plan is Rs. 15 lakh (earlier, it was Rs. 7.5 lakh) by each senior person
  • This plan is exempted from the Goods and Services Tax (GST)

• The investor is free to choose the preferable mode of pension payment (quarterly/ monthly/ half-yearly/ yearly) under this LIC Pension Plan for Senior Citizens

• Depending on your payment mode, the first installment of pension will start. (For monthly mode, it will start after a month, three months for quarterly mode, six months for half-yearly mode or one year for annual mode)
• LIC Vaya Vandana Yojana offers the utmost security as the payment is made through Aadhaar Enabled Payment System or NEFT
• You can purchase this plan either online or offline by visiting various branches of LIC
• This policy doesn’t come with any exclusion, including suicide
• By purchasing this LIC plan for senior citizens, an investor will not enjoy any benefits of tax exemption under the section 80C of the Income Tax Act

Some benefits of LIC Pradhan Mantri Vaya Vandana Yojana are:

• If the pensioner expires during the tenure period (10 years of this LIC Senior Citizen Saving Scheme), the nominee will get the purchase price as a death benefit
• Pension is given to the pensioner as long as he/she is alive for 10 years
• If the pensioner outlives the policy period (10 years), he/she will get the purchase price along with the final pension instalment.
• Premature withdrawal is permitted in certain cases, like a terminal illness. In this scenario, the pensioner will get the 98% of the purchase price

2. LIC Varishtha Pension Bima Yojana

This plan was introduced by the government and it was available from 15th August 2014 to 14th August 2015. The plan was ideal for senior citizens who are above 60 years. Since this plan was open for a limited period, hence this immediate annuity plan is no more available for investment.

Some of its features are:

• Anyone above 60 years can invest in this plan (no upper age limit)
• The plan offers a lifelong income benefit to senior citizens
• This plan offers a guaranteed interest rate of 9.00% p. a monthly
• The maximum limit of investment into the plan is Rs. 6, 66,665 per family
• Depending on your payment mode, the first installment of pension will start. (For monthly mode it will start after a month, three months for quarterly mode, six months for half-yearly mode, or one year for annual mode)
• The plan offers the utmost security as the payment is made through NEFT or Aadhaar Enabled Payment System
• After completion of 3 years, you can take loans against this policy
• You will get a lifelong pension if you choose the regular payment mode
• After completion of 15 years, you can surrender the policy

Some benefits of LIC Varishtha Pension Bima Yojana are:

• This is the best LIC policy for senior citizens, as it is tied up with other schemes such as mutual funds, provident funds and endowment plans etc.
• You are eligible for income tax benefits under Section 80CCC of the Income Tax Act
• In the event of sudden expiry of the pension holder, the purchase value is offered to the beneficiary
• The investor is free to choose the preferable mode of pension payment (quarterly/ monthly/ half-yearly/ yearly)

3. Pradhan Mantri Atal Pension Yojana

This plan ensures that every senior citizen in the country gets adequate financial security in their old age.

Some of its features are:

• A person between 18-40 years can invest in the plan for a minimum of 20 years to enjoy the benefits in their older age
• Fixed amount of (Rs. 1000, Rs. 2000, Rs. 3000, Rs. 4000, and Rs. 5000) is paid to the pensioner after attaining 60 years.
• A pensioner needs to invest for 20 years

4. LIC New Jeevan Nidhi

Apart from offering a pension, this plan provides savings and protection.

Some of its features are:

• Under this plan, the investors are eligible for bonuses
• You are flexible to choose your premium payments (regular or single)
• By incorporating riders into your plan, you can enhance the coverage
• The policy plan offers a high sum assured rebate (Rs. 3 lakh and above)
• Death during the first five years of the policy (benefit payable to the nominee is the sum assured accrued guaranteed additions)
• Death after the first five years of the policy (benefit payable to the nominee is the sum assured + accrued guaranteed additions simple reversionary bonus + final additional bonus)
• Your investment amount is qualified for tax deduction under Section 80CCC of the IT Act

5. LIC New Jeevan Shanti

This is a non-linked, non-participating single premium annuity plan that offers multifarious annuity options.

Some of its features are:

• Fixed pension for lifelong if you pay your premium at a time one-time
• The policy offers two annuity options (immediate annuity and deferred annuity) that are again divided into various options (12 more) to satisfy the requirements of every investor
• You can purchase this plan both online and offline
• After one year, you will get loans against the policy
• If the policyholder has a handicapped dependent, his/her investment amount will be reduced
• Your paid premiums are eligible for tax deduction under section 80CCC of the Income Tax Act

The Conclusion

These are some popular LIC senior citizen investment schemes. All these plans work efficiently and offer long-term saving options to policyholders. If you want to secure your life post-retirement, then choose the most suitable plan that will fulfil all your requirements. Make sure to learn about the LIC senior citizen scheme interest rate of all such plans and choose accordingly.