Reliance Smart Pension Plan

It is vital that you plan for retirement years now, so that you have adequate funds to satisfy your dreams during those retirement days. Preparation for whatever plans you have made should start today. Just to assist you, Reliance Nippon Life Insurance Company has introduced a pension plan, that is, Reliance – Smart Pension. It is a non-participating unit linked pension plan that enables you to save money and to provide you with a regular income after retirement by creating a much needed lumpsum. During the first five years of plan, Linked Insurance Products do not give any liquidity. Until the end of the 5th year, the policyholder will be unable to withdraw any money invested in Linked Insurance Products. This plan operates in 2 stages:

  • Accumulation Stage: In this stage, the policyholder pays premiums and top-ups that are invested in the fund in order to build the desired fund value.
  • Distribution Stage: Starts from the date of maturity/vesting, and payout are made according to the selected annuity options:
    • Life Annuity.
    • A secured annuity for a period of five, ten or fifteen years and then till the time period the policyholder person is alive.
    • Lifetime Annuity with the return of the purchase price on death.

Features of Reliance- Smart Pension Plan

Let us examine the main features of Reliance-Smart Pension:

  • Reliance- Smart Pension is a non-participating unit linked pension plan.
  • Helps create a large corpus by participating in the capital markets.
  • Top-up premiums can be paid at any time.
  • Loyalty additions of up to 9% are given in this scheme and added to the fund value, which begins from the end of the sixth year of the policy and is paid at the end of each third year of the policy.

Tax benefits on investment and on returns, as per applicable Income Tax Laws.

Benefits of Reliance- Smart Pension Plan

  • Benefits of Reliance- Smart Pension in case of death of the policyholder/annuitant:

If the policyholder/annuitant dies within the tenure of policy, the nominee shall receive the total value of the fund in the account or 105% of the total premiums paid; whichever is higher as death benefit on the date of intimation of death of the annuitant. The policy ends with the death benefit payment. The nominee is entitled to make use of death benefit in the following ways:

  • Withdraw the lumpsum amount of policy, or
  • Use the proceeds of the policy or portion of it to purchase the annuity from Reliance Life Insurance Company Limited at prevailing rate, provided that the nominee is eligible to purchase the same in accordance with the company’s underwriting policy.
  • Benefits of Reliance- Smart Pension in the event of policy maturity:

When the policy matures, the policyholder/annuitant shall receive the total value of the fund in the account or 101% of the total premium paid; whichever is higher. This benefit can be availed only if the policyholder chooses any of the below options:

  • Withdrawal of 33.33% of the total amount which is exempt from tax under Section 10(10)A of the Income Tax Act and the remaining balance must be used for the purchase of annuity that is guaranteed for life from Reliance Life Insurance Company Limited at the prevailing rate.
  • Use all the entire amount to buy a single premium deferred pension product from Reliance Life Insurance Company Limited.
  • The policyholder can extend the accumulation period of the same policy for another 5 years, provided that the policyholder is under the age of 55 years. Note: Total premiums include top-ups and excludes rider premiums, if any.

Eligibility Criteria

In the table below, you can see the eligibility criteria of the Reliance- Smart pension plan:

ParticularMinimumMaximum
Policy Term
10 years: Single Premium
15 years: Regular/Limited Premium
30 years
Entry age18 years as on last birthday65 years as on last birthday
Maturity/Vesting Age (n years)4575
Premium payment term for regular/limited premium option10 years30 years

Premium Payment details

Details on premium payment of Reliance - Smart Pension are shown below in the table:

PremiumMinimuMaximum
Regular Pay Premium Amount - Premium payment term 10 to 14 years- Not Applicable - Premium payment term 15 to 19 years:
Rs. 36000Annual mode
Rs. 18000Half Yearly Mode
Rs. 9000Quarterly Mode
Rs. 3000Monthly Mode
  • Premium payment term 20 years and above:
Rs. 20000Annual Mode
Rs. 10000Half Yearly Mode
Rs. 5000Quarterly Mode
Rs. 2000Monthly Mode
There is no limit
Limited Pay premium amount- Premium payment term 10 to 14 years
Rs. 48000Annual mode
Rs. 24000Half Yearly Mode
Rs. 12000Quarterly Mode
Rs. 4000Monthly Mode
  • Premium payment term 15 to 19 years:
Rs. 48000Annual mode
Rs. 24000Half Yearly Mode
Rs. 12000Quarterly Mode
Rs. 4000Monthly Mode
  • Premium payment term 20 years and above:
Rs. 24000Annual Mode
Rs. 12000Half Yearly Mode
Rs. 6000Quarterly Mode
Rs. 3000Monthly Mode
There is no limit
Single Pay premium amountRs. 50000No limit

Plan coverage details

The pension guarantee Reliance- Smart Pension Plan is an outstanding choice to receive a guaranteed pension throughout the years and helps to lead a care free life after retirement. It helps to receive the fixed income in accordance with the selected frequency of the annuity payment.

The plan covers death if it occurs during the policy tenure. Moreover, when the plan matures, then maturity benefit is paid.

Policy details

Further information on Reliance- Smart Pension plan is available below:

  • Charges associated with Reliance- Smart Pension

Reliance- Smart Pension plan is subject to certain charges:

a. Mortality Charges

This charge is deducted from the value of the fund under the base plan and Top-up premium. Depending on the following conditions the mortality charges may vary:

  • The insurance policy amount
  • Life assured’s attained age
  • Life assured’s occupation
  • Health of the life assured
  • The value of the fund At the start of each policy month, mortality charges are deducted on the monthly basis. The 1/12th of the mortality rates will be levied. For sub-standard lives, mortality charges may differ.

b.Fund Management Charges

The fund management fee is charged daily at the unit price of each fund. This is mostly calculated by adjustment of the NAV (Net Asset Value).

Fund TypeFund Management Charges
Pension Discontinued Policy Fund0.50% per annum
Pension Smart Fund 11.35% per month

c.Policy Administration Charges

  • Regular Premium and Limited Premium Policies: Rs. 40 per month will be deducted as policy administration charges. This charge will be levied from the 6th policy year and will continue till the end of the policy term.
  • Single Premium Policies:
Year of policyPolicy Administration Charges
1st year0%
2nd to 5th year1.50% per annum
6th year onwards0.75% per annum

At the beginning of the month, the monthly Policy Administration Charges shall be deducted from the fund.

d.Premium Allocation Charges

Premium Allocation Charges are deducted as a percentage of the premium each time the premium has been received before the units have been allocated.

  • In the case of Regular Premium and Limited Premium, the Premium Allocation Charges are mentioned in the table below:
Year of PolicyPremium Allocation Charges
1st year8%
2nd to 5th year5.50%
6th to 9th year5%
10th year onwards3%
  • In the case of Single Premiums, the Premium Allocation Charge is 2% per annum, and
  • In the case of Top-up, the allocation charge is 2% per annum of the Top-up amount.

e. Discontinuation Charges

The discontinuation charge shall be levied if a policy is discontinued by Reliance- Smart Pension policyholder and depends mainly on the year when the policy is discontinued.

  • Grace Period

The grace period for payment of regular premiums shall be 30 days from the due date. In the case of monthly premium payment mode, the grace period is 15 days.

  • Free Lock Period

If you do not agree to any terms and conditions of the policy, you may return the policy to the company within 15 days, which applies to all distribution channels, except for the Distance Marketing channel, which will have 30 days. The policyholder must state the objection, in which case, you have the right to the reimbursement of the premium paid, subject to deduction of expenses such as medical examination of the life assured and stamp duty charges, incurred by the insurer and the proportionate risk premium for the cover period.

Documents required to apply for Reliance- Smart Pension plan

The following set of documents are required to apply for Reliance- Smart Pension plan:

  • Application form which need to be filled up by the applicant.
  • For identity proof - Aadhaar Card, Voter Identity Card, PAN Card, etc.
  • For address proof - Passport, Aadhaar Card, Driving License, Voter Identity Card, etc.
  • Evidence of Age - Voter Identity Card, Driving License, etc.
  • Income proof: Bank statement, Income Tax Return receipt, salary slips, etc.
  • Passport-sized photograph of applicant.

Exclusions of Reliance- Smart Pension

The main exclusions of the Reliance - Smart Pension scheme is that, in any event, if the life insured individual commits suicide within 12 months from the date of issue of the policy or the date of revival of policy, then this policy is cancelled. The nominee/beneficiary of the policyholder shall only be reimbursed for the amount of premium paid till date.

Reviews of Reliance- Smart Pension plan

Reliance- Smart Pension plan is a non-participating unit linked plan which provides instant annuity. With retirement being an essential part of an individual’s life, every person aims at stress-free and relaxed life after retirement. This is only possible if you have a guaranteed source of income, even after retirement. Systematic and strategic retirement planning right from an early age will help you understand your expenses after retirement and how to manage certain investments to achieve your retirement goals.

FAQs on Reliance Life Smart Pension Plan

How secure your investment is?

Reliance Life Smart Pension Plan is Unit Linked Insurance Plan and the investment risk in this product is borne by the policyholder.

What do you mean by Distance Marketing Channel?

Distance Marketing shall include every solicitation activity and as well as sale of the insurance products by the following modes:

  • Voice mode, include telephone-calling
  • Short Messaging Services (SMS)
  • Physical mode includes newspaper & magazine inserts, direct postal mail
  • Electronic mode includes e-mail, internet and interactive television, and
  • Request by any other communication method other than in person.

What are the benefits for riders?

Reliance Life Insurance offers additional riders by which one can enhance their cover. The 5 riders offered by Reliance are:

  • Reliance Accidental Death and Total and Permanent Disablement Rider: In this case the extra additional benefits to the deceased/disabled is provided. Furthermore, in the case of disability, the rider’s waiver of the premium benefit will continue in the plan.
  • Reliance Term Life Insurance Benefit Rider: Provide extra death benefits based on the insured amount chosen under the rider.
  • Reliance New Major Surgical Benefit Rider: It provides lumpsum amount to cover expense related to surgery. List of 33 surgical expenses are covered.
  • Reliance New Critical Condition (25) Benefit Rider: Provides lumpsum amount to take care if diagnosed with any of the 25 critical conditions such as cancer, heart attack, major organ transplant, etc.
  • Reliance Life Insurance Family Income Benefit Rider: Provides benefits in the case of death or the permanent disability of the policyholder. The nominee/beneficiary receives a monthly benefit of 1% of sum assured, for 10 years OR from the date of death or total and permanent disability till the end of the rider policy term; whichever is earlier.

In the event of the death of the life of policyholder, the assured/annuitant riders’ benefit is payable directly to the nominee/beneficiary.

What happens if the policyholder wishes to surrender/discontinue the policy?

In case policyholder wishes to surrender his/her policy, one has to submit a dully filled surrender form on receiving the application that the policy is cancelled and the due policy proceeds that the policyholder is eligible for is paid and the policy is terminated.

What happens if the policyholder wants to revive the policy?

Within two years from the date of discontinuance, policyholders may reactivate the discontinued policy by paying all remaining fees. The company shall ask the written approval from the policyholder for the policies which have not completed 2 years of revival period at the end of the lock-in period to either:

  • Revive the policy right away; or
  • Revive the policy within a two-year period, until such date the fund continues to remain in the Discontinued Policy Fund and if the policy is revived within a two year, then the policy will be treated as per IRDA Regulations, 2010; or
  • Payout at the end of the lock-in period the proceeds and this option will be the default option if there is no written consent from the policyholder.
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