Best Pension Plans in India: Overview

A pension or retirement plan is an investment option that helps allocate savings to build a corpus over a fixed tenure. To get the maximum benefits post-retirement, you must invest regularly during your employment years. A suitable pension plan helps you beat inflation and assists you and your family in dealing with your needs during the post-retirement period.

At present, the insurance sector in India offers some of the best pension schemes for you to lead a financially secure life post-retirement. For your convenience, we have provided a list of the top 10 pension plans in India that you can consider for investing.

List of Top 10 Pension Plans in India

We have curated a list of the best retirement plans in India for you to choose from based on various key metrics such as the market reputation of the company, creditworthiness, number of branch offices, customer support quality, etc.

• LIC’s New Jeevan Shanti
• HDFC Life Click 2 Retire
• SBI Life Saral Retirement Saver
• ICICI Pru Easy Retirement
• Max Life Guaranteed Lifetime Income Plan
• Bajaj Allianz Lifelong Goal
• Kotak Premier Pension Plan
• ABSLI Empower Pension Plan
• Tata AIA Life Insurance Guaranteed Monthly Income Plan
• IndiaFirst Life Guaranteed Annuity Plan

Brief Description of Top 10 Pension Plans in India

This section provides information on the key features of each of the above-mentioned pension plans. For further details, you can refer to the plan brochures on the companies’ websites or reach out to us at PolicyX.com.

1. LIC New Jeevan Shanti Plan

   The LIC New Jeevan Shanti Insurance Plan is a non-participatory, non-linked, single premium payment plan that offers the benefit of returns through deferred annuity options. You can avail of this policy through online as well as offline mode. Under this plan, the payout modes of a deferred annuity are divided into two options - Joint Life Annuity and Single Life Annuity.

   Key Features

   • By making a one-time investment, you can avail of a long-term source of income.
   • Policyholders can avail of add-on cover for dependent people with disabilities under the plan.
   • The plan offers a discount on annuity rates.
   • Policyholders can choose from four annuity modes- monthly, quarterly, half-yearly, and annually.

   Know More About- LIC’s New Jeevan Shanti Plan

2. HDFC Life Click 2 Retire Plan

   The HDFC Life Click 2 Retire insurance plan is a unit-linked online insurance plan that offers market-based returns and also assists the insured in meeting post-retirement needs.

   Let’s understand this plan with a simple illustration. Mr. Verma purchases HDFC Life Click 2 Retire for 20 years term for Rs. 15 Lakh Single premium, the plan would provide a fund value of Rs 45,17,751 at 8% p.a. illustrative value.

   Assumed rate of return @ 8% p.a.- Rs 45,17,751

   Assumed rate of return @ 4% p.a.- Rs 21,23,802

   Key Features

   • The plan provides a death benefit that would be higher than the fund value or by 105% of the paid premiums.
   • The plan offers vesting benefits and no premium allocation charges can be imposed.
   • Policyholders can avail of tax benefits under section 80CCC of the Income Tax Act, 1961.

3. SBI Life Saral Retirement Saver

   It is a participating, individual, non-linked, savings pension product. SBI Life Saral Retirement Saver helps policyholders create an income source during retirement. You can also avail a life cover along with this plan with an SBI Term Insurance Rider.

   Key Features

   • Corpus can be built with a simple reversionary bonus, added regularly throughout the policy term.
   • Life cover can be availed with SBI Life - Preferred Term Rider.
   • Policyholders can avail of maturity as well as death benefits.
   • Policyholders can avail of tax benefits under section 80CCC of the Income Tax Act, 1961.

4. ICICI Pru Easy Retirement Plan

   ICICI Pru Easy Retirement helps provide a regular source of income to the insured through investment opportunities in stocks. The whole risk in this plan is borne by the policyholders as the returns depend on the market performance of your investments.

   Key Features

   • The plan comes out with multiple payment frequency modes such as monthly, bi-annual, and annual. Premiums can be paid yearly, half-yearly, or monthly.
   • The death benefit is equivalent to 105% of the total premiums paid.
   • With this pension policy, policyholders can reduce their taxable income.

5. Max Life Guaranteed Lifetime Income Plan

   The Max Life Guaranteed Life Income Plan is a traditional pension plan that assists policyholders in building a corpus toward a regular income post-retirement. You can also avail a joint life cover to ensure that you and your spouse are protected under the same plan

   Key Features

   • The plan keeps on providing a pension until you and your spouse are alive.
   • In case of the death of the insured, the plan provides the entire purchase price to the nominee.
   • You can receive a pension on a monthly, quarterly, semi-annually, or annually.
   • The plan offers six Annuity options.

6. Bajaj Allianz Lifelong Goal

   Bajaj Allianz’s Lifelong Goal is a unit-linked, whole life cover that helps in creating a savings corpus and earning income till the age of 99. This plan has two options to choose from: LongLife Goal II without Waiver of Premium & LongLife Goal II with Waiver of Premium.

   Key Features

   • The plan offers guaranteed loyalty additions.
   • Policyholders are assured an income stream till 99.
   • Policyholders can also benefit from the periodical return of life cover charges.
   • Policyholders can avail of tax benefits under Section 80C & 10(10D).

7. Kotak Premier Pension Plan

   Available online, Kotak Premier Pension Plan is a traditional, participating pension option for individuals looking to secure their retirement. This plan offers you guaranteed bonuses which is the fixed percentage of the basic sum assured.

   Key Features

   • The plan offers guaranteed additions and accrued bonuses.
   • Policyholders can choose from multiple premium payment modes.
   • Assured benefit is calculated as 105% of total premiums paid on death/vesting.
   • Additional protection against accidental death and disability can be availed.

8. Aditya Birla Sun Life Insurance Empower Pension Plan

   The Aditya Birla Sun Life Empower Pension is a unit-linked and non-participating pension plan. The plan helps you to build a financial corpus for the post-retirement days. This plan also offers you guaranteed additions that increase your overall benefits.

   Key Features

   • The policy offers vesting benefits and additions to your sum assured.
   • The death benefit payable is calculated as the guaranteed sum assured or the policy fund value at inception, whichever is higher.
   • The plan offers a self-managed option that allows you to choose the desired fund option as per your risk appetite.

9. Tata AIA Life Insurance Guaranteed Monthly Income Plan

   The Guaranteed Monthly Income Plan offered by TATA AIA is a non-participating, non-linked, individual life insurance savings option. It helps you create a financial net to fall back on in the future.

   Key Features

   • It offers monthly income for up to 10/16/24 years post-retirement age.
   • Monthly income increases on paying a high premium amount.
   • Policyholders have the facility to avail loans against their policy.
   • Premiums can be paid annually, half-yearly, quarterly, or monthly.

10. IndiaFirst Life Guaranteed Annuity Plan

    It is a deferred life annuity plan, under which policyholders can pay a single premium and receive lifelong benefits. The plan allows policyholders to choose from 12 different annuity options per their needs.

    Key Features

    • The return of the purchase price facility can be availed on the policyholder’s death.
    • Joint life cover offers policyholders the option to support their loved ones under the cover.
    • The annuity amount grows constantly with the escalating life annuity option.

Benefits of Buying Pension Plans in India

Buying a retirement or pension plan in India offers a range of benefits. Let’s understand these benefits in detail:

Basis for Selection

The above-mentioned insurers have been selected on the basis of the highest income in terms of Annual New Business Premiums.

The following table highlights these insurers and the premium income generated by them in FY 2022-23.

To Sum It Up

While each plan comes with its own set of benefits, you must identify what your needs are. If you are the sole earning member of your family right now, or you have certain debt obligations to fulfill, or your kids’ education to plan, the pension amount should be more than all your potential expenses combined.

While market-linked investment options incur higher purchase prices, these plans are more likely to guarantee a larger corpus. However, if you are averse to risks and wish to remain protected from market volatility, a traditional savings/annuity plan is a good place to start.

The foremost factor, however, should be to lead a life without financial obligations post-retirement and the best option is the one that manages to fulfill your long-term goals. For more guidance on pension planning, visit PolicyX or call us at 1800-420-0269.