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Top Ten Pension Plans in India

Retirement is inevitable and is an important reality for everyone. You will continue to live a regular life even after retirement. Hence the expenses do not escape from your life post-retirement. They will occur after that. Owing to this truth, you need a retirement plan to meet the daily expenses. Early retirement planning gives you the opportunity to spend the golden years of life post-retirement with a better lifestyle. Early planning keeps you financially independent to deal with everyday expenses and medical expenses that may arise as you grow old. Engaging in prudent retirement planning can help you get reassurance.

PolicyX is an online portal that helps you to convert your life-savings into a lifelong regular income source by providing the best comparisons between annuity plans.

If you are looking for the right pension plan which works for you after you have stopped working, then you are in the right place. We have made the list of Ten Best Pension Plans in India which are best suited for the persons who are looking to plan their retirement effectively in 2019.

  1. LIC Jeevan Akshay 6 Plan

The LIC Jeevan Akshay VI Plan is an immediate annuity plan that can be purchased by paying a gross amount by a person. The project offers annuity payments in a different timeline such as annually, half-yearly, quarterly or monthly.

Salient Features

  • Minimum entry age in the plan is 30 years.
  • Maximum age in the plan is 85 years.
  • Age proof is mandatory.
  • Maximum Purchase Price is set at 1,00,000 for offline distribution channels.
  • Maximum Purchase Price is set at ₹ 1,50,000 for online distribution channels.
  • There is no maximum limit for the purchase price and annuity.

Benefits

  • The premium amount is paid in lump sum.
  • Pension can be received in different time frames viz monthly, quarterly, half yearly or annually.
  • Premium paid is exempt from tax under chapter VI-A of the Income Tax Act, 1961.
  1. LIC Jeevan Nidhi Plan

LIC Jeevan Nidhi is a deferred annuity pension plan with assured profits. On survival of the purchaser of the policy more than the term of the procedure, the accumulated amount is used to generate the pension for the beneficiary. The scheme also provides a risk cover during the deferral period.

Salient Features

  • Under regular premium, the maximum sum assured is ₹1,00,000
  • Under single premium policies, the maximum sum assured is ₹1,50,000.
  • Minimum vesting age is 55years, and the maximum period is 65 years.

Benefits

  • Premium paid are exempt under section 80CCC of the Income Tax Act, 1961.
  • There is no maximum limit for the necessary sum assured.
  • Guaranteed additions of ₹50 /- per thousand sum assured for each completed year, during the first five years.
  • The policyholder has the right to participate in the profits of the organisation from sixth year onwards.
  • The policyholder is entitled to bonuses declared by the corporation.
  1. SBI Life Saral Pension Plan

The SBI Life Saral Pension Plan is an individual participating non-linked traditional pension plan that is connected with guaranteed bonuses for the first five years and basic reversionary bonus after that throughout the policy term if any.

Salient Features

  • Minimum entry age is 18 years, and the maximum age is 65 years.
  • Minimum maturity age is 40 years, and the maximum age is 70 years.
  • Minimum Sum Assured is Rs 1 lakh with no maximum limit attached.
  • Minimum premium payment of Rs 7,500 per annum with no maximum limit.

Benefits

  • Guaranteed bonuses for the first five years.
  • The policyholder is assured of vesting bonuses on the maturity of the plan.
  1. HDFC Life- Assured Pension Plan

HDFC Life Assured Pension Plan is a unit linked plan offered by HDFC Life that provides a return related to the market together with policy addition. The idea is ideal for those who are planning their retirement, and this helps you set your retirement goals in advance.

Salient Features

  • Secure your retirement with guaranteed maturity benefits.
  • Loyalty additions in the form of annuity multipliers every year, first starting in the 11th year.
  • Option to start as early as 18 years.
  • Maximum age decided for the plan is 45 years.
  • Limited pay and single payment options are available in one product.

Benefits

  • Guaranteed vesting benefits along with additional benefits from the market.
  • When the policy matures at the end of the policy term, the benefit will be higher of the Fund Value or Assured Vesting Benefit.
  • Assured Vesting Benefit can be calculated as:
  • [101% + 1%* (Policy term- Premium Paying Term)* Total Premium Paid.]
  • There will be loyalty additions in the form of pension multipliers will be added to the fund value, every alternate year starting from the end of 11th year.
  • In the event of the death of the policyholder before the end of the policy term, the legal heir of the policyholder will receive higher of the following amount:
  • Fund Value
  • 105% of the premium paid.
  • Tax benefits under section 10(10D) and 80(C) of the Income Tax Act, 1961.
  1. ICICI Pru- Easy Retirement

ICICI Pru- Easy Retirement plan is another unit linked pension plan which is designed in such a way that on vesting, the policyholder will be rewarded higher of the fund value or assured vesting benefits equal to 101% of the total premium paid till date.

Salient Features

  • The policyholder has the option of extending the vesting age given he/she is below 55 years of age.
  • Four free switches are allowed every year to switch between the funds.
  • The premium payment can be increased or decreased by the terms and conditions attached to the plan.
  • Easy Retirement Balanced Fund and Easy Retirement Secure Fund are available for investment.

Benefits

  • Tax benefits are available on premiums and other benefits.
  • The plan offers payment in different time stream of monthly, half yearly or yearly.
  1. HDFC Life – Click 2 Retire

HDFC Life – Click 2 Retire is an online unit-linked pension scheme that offers market-related returns and helps the policyholder achieve retirement goals by planning well in advance. The project assists in preparing for early retirement and policyholder can enjoy the regular income for the rest of his life through this pension scheme. Furthermore, HDFC Life- Click 2 Retire plan to let the money work for you instead of you working for the money.

Salient Features

  • It is an online pension plan.
  • It has an option of starting early at the minimum age of 18 years.
  • Lower vesting age of 45 years.
  • It secures the retirement of the policyholder with guaranteed maturing benefits.
  • There are these following options available in one single product- Regular, Limited Pay and Single Pay.

Benefits

  • Vesting Benefit: When the policy of the policyholder matures at the end of the term, the maturity benefit will be higher of the following:
  • Fund Value
  • Assured Vesting Benefit.

Assured Vesting Benefit can be calculated as:

[101% + 1%* (Policy term- Premium Paying Term)* Total Premium Paid.]

On maturity, the policyholder has the opportunity to buy an annuity from the range of options provided by HDFC. In this scheme, the policyholder will get guaranteed income for himself/herself and spouse.

  • The deferment of retirement date can be intimated any time before maturity.
  • The policyholder can postpone the maturity date any number of times subject to maximum vesting age of 75 years as long as you are below the age of 55 years.
  • In case of death of the policyholder, before the term ends, the nominee will receive the higher of the fund value or 105% of the premium paid.**

** The policy will terminate after the death of the policyholder and remaining funds paid to the family. After that, no more benefits will be payable.

  1. Reliance Life Smart Pension Plan

Reliance Life Smart Pension Plan is a non- participating unit linked pension plan that allows the policyholder to save regularly. Under this plan the premium can be paid in the following ways:

Single Premium Paying Term- The premium amount is released in a lump sum.

Limited Premium Paying Term- The premium amount is paid for a limited period.

Regular Premium Paying Term- The premium is divided equally by the number of years of policy term and is paid throughout the tenure.

Apart from this, there is loyalty addition which starts from the end of the 6th policy year and is paid at the end of every third policy year.

Salient Features

  • It is a deferred annuity plan with a single, limited and regular premium paying term.
  • Under this scheme, there is only one plan for investment.
  • There are five riders in this plan
  • There are two stages to this plan:
  • Accumulation Stage: In the Accumulation Stage, the premium needs to be paid to build up the desired fund value for the corpus.
  • Distribution Stage- In the Distribution Stage, the annuity needs to opt among three possible options:
  • Life Annuity
  • Annuity Certain for five, ten or fifteen years.
  • Life Annuity with return of purchase price.
  • The policy term ranges from 10 years to 30 years.
  • There is loyalty addition which starts from the end of the 6th policy year and is paid at the end of every third policy year.
  • The policyholder can defer the vesting period by a minimum of 5 years as long as you are below the age of 55 years.

Benefits

  • With Reliance Nippon Life Smart Pension Plan, the policy-holders can
  • Build a corpus for their life after retirement.
  • Decide their retirement age.
  • Live life on their terms.
  • Ensure regular income for a lifetime.
  • Get tax benefits with predetermined terms and conditions.
  1. Bajaj Allianz Pension Guarantee Plan

Bajaj Allianz Pension Guaranteed Plan is a non-unit linked traditional insurance plan offered by Bajaj Allianz Life Insurance with a single premium option. With this plan, the policyholder can ensure a regular income after retirement. The first annuity payment in one month, three months, six months or a year after the start of the policy subject to annuity payment mode the policyholder has chosen, i.e. monthly, quarterly, half-yearly or yearly. The immediate annuity options available under this scheme are:

  1. Life Annuity
  2. Life Annuity with return of purchase price
  3. Annuity Certain for period five years, ten years, 15 years, 20 years and life after that.
  4. Joint Life Last Survivor with 50% of annuity to spouse
  5. Joint Life Last Survivor with Return of Purchase Price on the death of the Last Survivor (100% of pension to spouse)
  6. Joint Life Last Survivor with 100% of premium to the spouse

The annuity amount will depend on the pension option chosen by the annuitant and the prevailing rates of the annuity at the time of purchase and will be guaranteed as per the annuity option selected for the annuity payment period.

Salient Features

  • Minimum age at entry should be 37 years, and the maximum age should be 80 years under regular annuity plan.
  • Minimum age at entry should be at least 37 years, and maximum age should be 80 years of annuitant and spouse under joint life last survivor policy.
  • The minimum purchase price is ₹25,000 while there is no limit on maximum purchase.
  • Annuitant will get tax benefits as per applicable tax laws.

Benefits

  • The annuity is paid to the annuitant as long as he/she is alive.
  • The annuitant and his/her spouse are covered under Joint Life Survivor Policy, and the annuity is paid to the annuitant or his/ her spouse as long as one of them is still alive.
  • In the event of the death of annuitant amid policy period, other than Joint Survivor Policy, the annuity will be paid to a legal heir or nominee of the annuitant.
  1. Max Life Guaranteed Lifetime Income Plan

Max Life Guaranteed Lifetime Income Plan is a traditional non-participating immediate annuity plan which offers regular cash flow after retirement and allows the policyholder to convert his/her savings into lifelong income.

Salient Features

  • The plan provides payout flexibility; thus the policyholder can choose payout option to receive payout monthly, quarterly, half-yearly or yearly.
  • It comes with multiple annuity options, and one can choose between single life annuity and Joint life annuity as per the needs.
  • Guaranteed income to cater to the financial needs at old age.
  • Annuity options that provide a return of the purchase price.
  • Minimum entry age is 50 years whereas the maximum age is 80 years.

Benefits

  • Guaranteed income to the policyholder as long as he/she is alive.
  • Under the joint life annuity plan, the surviving spouse can enjoy the benefits after the death of their partner.
  • After the death of the insured person, legal heir or nominee will get the purchase price of the policy.
  1. Birla Sun Life Empower Pension

Birla Sun Life Insurance Plan is a unit linked, non participating general retirement/pension plan to help policyholders enjoy his life post-retirement.

Salient Features

  • Policy term ranges from 5 years to 30 years.
  • Minimum entry age is 25 years, and the maximum age is 70 years.
  • Option to select the maturity date to have an accumulated period of 5 to 30 years.

Benefits

  • The policy has survival, death and maturity benefits.
  • The plan provides an opportunity to choose the policy premium amount.
  • The policyholder is benefitted to choose risk profile based on risk appetites.

Everyone has hopes for retirement as it is the golden period of life. PolicyX is here to ensure that you pick the best plan according to your need to enjoy a better life ahead. To achieve a worry-free retired life, invest in one of the plans mentioned above. With monthly payouts and competitive advantages, you can look forward to the best pension plan. PolicyX family wishes you all a very happy and healthy post-retirement life.

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