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Life Insurance Corporation or LIC is one of the oldest and most sought after insurance companies in India. Founded way back in the year 1956, this Government owned entity has been rendering insurances to a host of population of all ages throughout the country, at the most nominal prices with exemplary benefits.
With a reputation that leaves all other insurance companies behind, LIC has been pioneering the field of insurance since years and has maintained its goodwill among its customers till date.
In fact, LIC was awarded the No. 6 Most Trusted Service brand of India by none other than the Economic Times Brand Equity Survey, 2012. In this article, we tell you about the LIC Jeevan Akshay VI Plan and its salient features. Apart from that, we also give you eligibility details of this plan as well as answer some frequently asked queries by customers with respect to the policy and its returns. But first, let us tell you what this policy is all about.
LIC Jeevan Akshay VI Plan
The LIC Jeevan Akshay VI Plan is an Immediate Annuity Plan that can be bought by paying a lump sum amount by a person. This policy offers annuity payouts in different time frames such as monthly, quarterly, half-yearly or annually. The amount is fixed and depends on the amount invested in the policy. This policy is best for people who are retired and are looking for stable options of income so that they remain independent and can secure their financial stability, even after retirement.
Lump Sum Payment - One of the most advantageous features of the LIC Jeevan Akshay VI Plan policy is that the amount has to be invested all at once. Thus, you can easily escape the rigours of investing at regular periods and saving your budget for the same. There are not many policies in the market that offer such a feature; however, LIC is surely one of them.
Medical Examination - Unlike most insurance policies that mandate that the person willing to purchase an insurance policy has to undertake several complex medical examinations, LIC Jeevan Akshay VI Plan does not require the prospective insured to undergo any such medical test. This makes it all the more easier and convenient for people suffering from diseases to avail the benefits of this policy.
Purchase Price - The minimum purchase price for this policy is INR 1,00,000. However, if you are purchasing the policy online, the minimum price that you have to pay is INR 1,50,000. It may be pertinent to mention here that there is no maximum limit on the purchase price of the policy. You can choose the investment amount depending on your budget and return considerations.
Age - Anyone who has completed the age of 30 years can invest in the policy. However, the person should not exceed the age of 85 years. This is a great policy since the upper limit of age is quite high when compared to other insurance policies that avoid giving insurance to persons who have crossed the age of 60 years or so.
Annuity Rates - For those purchasing the insurance policy online, you surely stand a better chance since the annuity rates for online purchases are higher as compared to the offline ones.
Documentation - The documentation for buying the LIC Jeevan Akshay VI Plan is not at all cumbersome. In fact, if you choose the online method, the deal becomes all the more trouble free since you can purchase the policy just with a few clicks, by submitting relevant documents online.
The applicant has to be a citizen of India.
The LIC Jeevan Akshay VI Plan offers seven types of annuity options which the insured can choose from. Following are the choices available:
Option 1 - In the first mode of annuity, the pension is paid to the policyholder till the time he is alive. The amount paid is uniform throughout the payment period.
Option 2 - In this option, the annuity sum is paid as a guaranteed amount to the insured person for 5,10, 15 or 20 years, irrespective of the fact whether the insured is alive or not during this payment period. Once the period expires, the insured continues to receive the amount for the time period for which he is alive.
Option 3 - In this option, the annuity amount is paid to the insured till the time he/she is alive. Post his/her death, the purchase price or the amount initially invested is returned to the nominee of the policyholder. This ensures that the family does not have to suffer financially after the policyholder is gone.
Option 4 - This annuity option pays an increasing amount to the policyholder at a simple interest of 3 percent per annum for the time period for which he/she is alive.
Option 5 - This option has something in store for both, the policyholder as well as the spouse. In this scheme, the policyholder is paid the annuity sum till the time he/she is alive. On his/her death, half the amount of the annuity sum is paid to the spouse for his/her lifetime. However, all benefits come to a halt on the death of both, the husband as well as the wife.
Option 6 - In this scheme, the policyholder continues to receive the annuity sum during his/her lifetime. On the death of the insured, 100 percent or full amount of annuity continues to be paid to the spouse. The benefit comes to an end on the death of the couple.
Option 7 - This scheme is similar to the sixth option. However, the only difference lies in the fact that the purchase price is returned once the policyholder as well as the spouse have expired. It may be noted that once the policyholder has decided to stick to a particular annuity scheme, he/she cannot change the same and it continues for the complete time period for which the insured and the spouse are entitled.
One reason why people prefer to buy insurance policies apart from the aim of securing their future is to save taxes. Well, interestingly, the Income Tax Act, 1961 provides several benefits to policyholders so they can escape the burden of taxes.
The purchase price of LIC Jeevan Akshay VI Plan also qualifies for tax deductions under Section 80C of the Income Tax Act, 1961. All persons who have invested in the policy on or after 2007-08 qualify for the same. However, the benefit is restricted to a total amount of INR 1,00,000 for a particular financial year.
What is LIC Jeevan Akshay VI Plan?
The LIC Jeevan Akshay VI Plan is an immediate annuity plan for which the purchase price has to be paid altogether and the benefits that accrue from the policy can be received in instalments as per the choice of the policyholder.
Is LIC Jeevan Akshay VI Plan a good policy?
Well, the LIC Jeevan Akshay VI Plan is surely a good policy for it comes from one of the most reputed insurance companies of India, LIC. Apart from its credibility, it offers several benefits such as uniform pension plans, lump sum payments, tax deductions, etc.
How does LIC Jeevan Akshay VI Plan work?
The working of the insurance plan is quite simple. All the policyholder has to do is purchase the policy by paying a one-time price and decide how he/she is going to receive the annuity. The amount of annuity can be received monthly, quarterly, half yearly, yearly.
Is LIC Jeevan Akshay VI Plan a good investment?
Certainly. The LIC Jeevan Akshay VI Plan ensures financial independence to people after retirement or to those looking for stable income options. Apart from that, the tax deduction under the act makes it quite a favourable plan for potential insurance policyholders.
Is annuity income from LIC Jeevan Akshay VI Plan taxable?
The pay outs received from this annuity plan are considered as Income in the hands of the policyholder. The income will be taxed as per the applicable tax provisions and tax bracket the policyholder falls under.
What are the advantage and disadvantages of annuity?
The advantages are as follows:
The disadvantages are: