LIC Varishtha Pension Bima Yojana

What is Varishtha pension bima yojana

After retirement, the majority of senior citizens depend on their pension as a steady source of income. Senior citizens, in addition to their normal monthly pensions, should see annuities as a way to ensure a steady stream of income. 

Similarly, the Indian government introduced a pension scheme in 2014-15 and again in the 2017-18 union budget. For senior citizens, this plan provides a fixed pension with guaranteed interest rates.

The LIC Varishtha Pension Bima Yojana is a special scheme for senior citizens. It is a pure retirement scheme in which the pensioner earns a lifetime pension in the form of an immediate annuity. An annuity is a collection of payments paid to an individual regularly. 

The Indian government resurrected this plan in 2014-2015, citing the plan's recent success, according to the finance ministry. A total of 6095 crores and 3.16 lakh policies were sold under the Varishtha Pension Bima Yojana programme. As it is for senior citizens, the minimum age is 60 years old, and the premium payment system is single pay.

Key features of varishtha pension bima yojana

The success of Varishtha Pension Bima Yojana is due to its policy that focuses to benefit the senior citizens.

Here are the key highlighting features of VARISHTHA PENSION BIMA YOJANA.

  • If you are 60 or older, you are eligible for this scheme, which does not require a medical exam.
  • Surrender Value is a choice available to policyholders who have been diagnosed with a terminal or serious illness.
  • The LIC Varishtha Pension Bima Yojana Plan has several payout options. You have the option of receiving payments monthly, quarterly, semi-annually, or annually. From the date of receipt of the premium, payments will be made every 1 month, 3 months, 6 months, and 1 year.
  • Monthly Payment - With the monthly payout option, you will be paid a fixed amount per month, with a purchase price starting at $66,665. If you choose the monthly payout option, you can invest up to 6.66 lakhs.
  • Quarterly Payout - You'll get a payout every three months or four times a year if you want the quarterly payout choice. The policyholder who chooses this choice will make an initial payment of 66,170 or 6,61,690.
  • Semi-Annually - If the policyholder chooses the semi-annual payment method, they can start by paying 65,430 or 6,54,275.
  • Yearly Payout - This is the amount charged to the policyholder on an annual basis. You can start with a payment of 63,960 or 6,39,610 if you choose this choice.
  • Global Electronic Fund Transfer (NEFT) or Electronic Clearing Service (ECS) is the mode of payment (ECS). Senior citizens have found the online mode of transfer to be more convenient.
  • The policyholder will surrender the policy after 15 years of investment and receive a refund of the purchase price, which is the premium price charged at the time of policy purchase.
  • A policyholder may take out a loan against their policy after three years of lock-in. The loan sum may be up to 75% of the policy's value, and the interest rate is set by LIC.

A 15-day free-look period is included with the LIC Varishtha Pension Bima Yojana Plan. If you plan to cancel the policy, you will obtain a refund of your entire premium.

Benefits of varishtha pension bima yojana

The LIC Varishtha Pension Bima Yojana provides a wide variety of incentives and benefits for senior citizens since it is a government of India initiative. The Varishtha Pension Yojana offers the following benefits:

  • NEFT or ECS is used to make all payments under this policy. As a result, there's no need to be concerned about cashing a check or getting a demand draught.

  • It provides an assured pension with an annual fixed interest rate of 8%, which is higher than most other senior citizen pension plans.

  • You have the option of receiving the pension check monthly, quarterly, semi-annually, or annually.

  • It includes a 15-day free-look period following receipt of the policy. If you plan to quit the programme, the fee will be refunded (after deduction of stamp duty charges).

  • Death benefits are also available through the LIC Varishtha Pension Bima Yojana. The premium charged will be refunded to the spouse/nominee if the policyholder dies.

Frequently Asked Questions

Here are the most commonly asked questions on Varishtha Pension Bima Yojana.

What is the minimum age requirement to open an account in VARISHTHA PENSION BIMA YOJANA?

Only individuals of 60 years or above can open a Varishtha pension bima yojana. 

Can I withdraw my premium amount?

The VARISHTHA PENSION BIMA YOJANA scheme gives the senior citizens a 15 days look period. If you wish you can withdraw your complete premium amount within this 15 days look period.

What are the documents required for opening a VARISHTHA PENSION BIMA YOJANA account?

You will need to submit a few important documents at the time of the application procedure. You must have your complete medical history, address proof, ID proof and KYC related documents in original and Xerox.

What is the interest rate of VARISHTHA PENSION BIMA YOJANA?

Varishtha Pension Bima Yojana currently gives an interest rate of 8%.

After how many years can I avail loan on VARISHTHA PENSION BIMA YOJANA?

You can avail Loan after completing 3 years. The loan amount must be 75% of the purchased price.