Interested in annuity plans from LIC? Here are 3 plans you can look at

When it comes to insurance, many people trust LIC with their money. Even now, when people think of retirement planning, they look at LIC.

And if you are thinking of buying an annity plan from LIC that can help you with post-retirement expenses, you are in the right place.

In this article, we will describe the annuity plans offered by LIC so that you can shortlist the right one for you.

RAED MORE: What is an annuity plan? All you need to know

Jeevan Akshay – VII

LIC's Jeevan Akshay-VII is an immediate annuity plan. This means that the annuitant must pay a lump sum to buy the plan, and the income payout will start immediately.

There are ten different options for the payment of the lump sum amount.

Option A: The first option is Option A which is an immediate annuity for life. That is, the company will pay the annuity as long as the annuitant is alive. It offers a guaranteed annuity rate that is fixed at the time of inception. The annuity is paid throughout the annuity period.

Option B,C,D,E: These are immediate annuity options for guaranteed periods of five, 10, 15, and 20 years and life after that. The annuity will be paid to the person as long as they are alive as per the chosen mode of payment.

After the annuitant's death, the annuity will be paid to the nominee(s) until the end of the guaranteed period, which can be 5/10/15/20 years.

The annuity payment will instantly stop if the annuitant dies after the guaranteed period.

Option F: It is an immediate annuity plan for life with a return of purchase price.The annuity is paid as long as the annuitant is alive. After that, the annuity income will stop, and the nominee will receive the purchase price of the annuity plan.

Option G: Itis an immediate annuity for life where the annuity income increases by 3% every year. On the death of the annuitant, the annuity will cease to exist.

Option H: In this joint life immediate annuity for life, the secondary annuitant will receive 50% of the annuity after the death of the Primary Annuitant.

Option I:Here, 100% of the annuity is paid for life to the secondary annuitant after the primary annuitant's death.

Option J: It is similar to Option I. But this option returns the purchase price on the death of the last survivor in addition to the 100% annuity to the survivor.

READ MORE: Is an annuity a good investment option? Here are its pros and cons

Eligibility 

Age: The person has to complete 25 years to buy the plan, and the maximum entry age is 85 years for all plans except the F option. The maximum age is 100 for option F.

Minimum Purchase Price:The minimum purchase price is ₹10 lakhs if the entry age is between 25 to 29 years. For individuals who are 30 years and above, the minimum purchase price is ₹1 lakh, subject to the minimum annuity.

The minimum annuity will depend on the annuity mode.

If your purchase price is less than ₹1.5 lakhs, then the annuity rates are reduced with reduction factors.

New Jeevan Shanti

While Jeevan Akshay – VII was an immediate annuity plan, New Jeevan Shanti is a deferred annuity plan. It is a single premium plan, meaning the annuitant pays the premium amount only once. It comes with single and joint life deferred annuity plans.

The annuity rates are guaranteed and are paid after the deferment period. This plan has two options: deferred annuity for single life option and deferred annuity for joint life.

In the single life option, if the annuitant dies during the deferment period, the nominee will receive the nominee benefits. After the deferment period, the annuity will be paid as per the chosen mode. Also, the nominee will receive death benefits after the annuitant's death, not an annuity.

In the case of the joint life option, the nominee will receive the death benefit after the death of the last survivor. This is applicable during the deferment and after the deferment period as well.

READ MORE: What are the different types of annuity plans? MintGenie explains

Eligibility

Saral Pension

This single premium, deferred annuity plan comes with two options. The first option is theLife Annuity with a Return of 100% of the Purchase Price, where the annuity payments are made till the annuitant is alive.

The second option is joint life annuity. Here, the spouse receives 100% of the annuity after the demise of the primary annuitant. And, on the death of both spouses, 100% of the purchase price of the plan is returned to the nominee.

The annuitant can surrender the policy at any time after six months from the policy commencement date if the annuitant, spouse, or any of the children is diagnosed as suffering from critical illnesses.

READ MORE: Retirement planning: 6 factors to consider when choosing an annuity plan

Eligibility

Conclusion

LIC offers three annuity plans: Jeevan Akshay – VII, New Jeevan Shanti, and Saral Pension. It is important to thoroughly review all the plans and talk to an expert before buying any annuity plan.

Padmaja Choudhury is a freelance financial content writer. With around six years of total experience, mutual funds and personal finance are her focus areas.