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Top 10 Pension Plans of India
Looking forward to a nice retired life? Well, we are here to help! Read on to find out the top 10 pension plans one must consider investing in.
A pension plan is a retirement plan which is designed specifically to provide investment and insurance benefits post retirement days. Under this plan, you invest regularly during the course of your employment years and develop a corpus which can be utilized once you have retired. A well-selected retirement plan can help you beat inflation and the accumulated corpus can help you and your family meet the needs that arise post retirement.
Note: All information regarding product benefits and eligibility details have been sourced from the official websites of the respective insurance/pension providers.
Top 10 Pension Plans of 2018-19
LIC’s Jeevan Akshay 6 Plan
This is a single premium, non-linked and without profit annuity plan which can be purchased on an immediate basis by paying a lump sum amount.
Product Benefits
Annuity Options Available
i) Annuity payable for life at a uniform rate.
ii) Annuity payable for 5, 10, 15 or 20 years certain and thereafter as long as the annuitant is alive.
iii) Annuity for life with return of purchase price on death of the annuitant.
iv) Annuity payable for life increasing at a simple rate of 3% p.a.
v) Annuity for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant.
vi) Annuity for life with a provision of 100% of the annuity payable to spouse during his/her lifetime on death of the annuitant.
vii) Annuity for life with a provision of 100% of the annuity payable to spouse during his/ her life time on death of annuitant. The purchase price will be returned on the death of last survivor.
Death Benefit
a) Under option (i) annuity ceases.
b) Under option (ii) 1. On death during the guaranteed period - annuity is paid to the nominee till the end of the guaranteed period after which the same ceases. 2. On death after the guaranteed period - annuity ceases.
c) Under option (iii) annuity ceases and the purchase price is paid to the nominee.
d) Under option (iv) annuity ceases.
e) Under option (v) annuity ceases and 50% of the annuity is payable to the surviving named spouse during his/her lifetime. If the spouse predeceases the annuitant, the annuity ceases.
f) Under option (vi) annuity ceases and full annuity is payable to the surviving named spouse during his/her lifetime. If the spouse predeceases the annuitant, the annuity ceases.
g) Under option (vii) annuity ceases. Full annuity is payable to the surviving named spouse during his/ her life time and purchase price is paid to the nominee after the death of the spouse. If the spouse predeceases the annuitant, the annuity ceases and purchase price will be paid to the nominee.
Premium
Single, lump sum
Age Proof Required
Yes
Mode of Payment
Monthly, quarterly, half yearly or yearly intervals
Medical Test
No
Eligibility Details
Age at Entry
Min - 30 years
Max: - 100 years (completed) for annuity option Annuity for life with return of purchase price on death of the annuitant.
- 85 years (completed) for all annuity options other than Annuity for life with return of purchase price on death of the annuitant.
Minimum purchase price
Rs. 1,00,000/- for all distribution channels except online.
Rs. 1,50,000/- for on line sale.
LIC’s Jeevan Nidhi Plan
This is a conventional with profits pension plan which comes with a combination of protection and savings.
Product Benefits
Vesting Benefit
Vesting benefit amount payable will be equal to the Basic Sum Assured along with accrued Guaranteed Additions, vested Simple Reversionary bonuses and Final Additional bonus, if any.
Death Benefit
- In case of death during the first five policy years: Basic Sum Assured along with accrued Guaranteed Addition shall be paid as lump sum or in the form of an annuity or partly in lump sum and balance in the form of an annuity to the nominee.
- In case of death post the first five policy years: Basic Sum Assured along with accrued Guaranteed Addition, Simple Reversionary and Final Additional Bonus, if any, shall be paid as lump sum or in the form of an annuity or partly in lump sum and balance in the form of an annuity to the nominee.
Guaranteed Additions
@ Rs. 50/- per thousand Basic Sum Assured for each completed year, for the first five years.
Rider Add-on
LIC’s Accidental Death and Disability Benefit Rider.
Eligibility Details
Minimum Basic Sum Assured
Rs. 1,00,000 under Regular Premium policies Rs 1, 50,000 under single premium policies.
Maximum Basic Sum Assured
No Limit (the basic sum assured shall be in multiples of Rs. 5000/-) (in years).
Minimum Entry Age
20 years
Maximum Entry Age
60 (nearest Birthday) under Single Premium 58 (nearest birthday) under regular premium.
Deferment period
5 to 35 under Single Premium & 7 to 35 under regular premium.
Minimum Vesting Age
55 years.
Maximum Vesting Age
65 years.
SBI Life Saral Pension Plan
This is an individual participating non-linked traditional pension plan which comes with Guaranteed Bones and Simple Reversionary Bonus.
Product Benefits
Tax Benefits
They can be claimed as per Section 80CCC and Section 10(10A)(iii) of the Income Tax Act, 1961.
Vesting Benefit
The Vesting Benefit payable will be equal to the Sum Assured plus Vested Simple Reversionary bonus plus Terminal bonus, if any.
Death Benefit
The Death Benefit payable will be a higher of total premiums paid accumulated at an interest rate of 0.25% p.a. compounded annually plus vested reversionary bonus plus terminal bonuses, if any, or 105% of total premiums.
Rider Add-ons
SBI Life - Preferred Term Rider
Bonus
Guaranteed Simple Reversionary Bonuses for first 5 years for inforce policies; @ 2.50% for first three years and @2.75% for next two years.
Eligibility Details
Age at Entry
18 years – Min
Maximum:
Regular Premium - 60 years
Single Premium - 65 years
Age at Vesting
40 years – Min, 70 years - Max
Policy Term
Minimum
Regular Premium - 10 years
Single Premium - 5 years
40 years - Max
Sum Assured
Min - ₹1,00,000/-
Max - No such limit
Premium Frequency
Single|Half -Yearly|Yearly|Monthly
The premium for various modes as percentage of annual premium are given below:
Monthly - 8.4% of annual premium
Half-Yearly - 50.2% of annual premium
Premium
₹7,500 per annum - Min
No such limit on maximum amount
HDFC Life - Click2Retire
This is an online unit-linked pension plan which offers market linked returns along with regular income.
Product Benefits
Vesting Benefit
The vesting benefit payable will be a higher of fund value or assured vesting benefit, where assured vesting benefit can be calculated as:
[101% +1% * (Policy Term minus Premium Paying Term)] * Total premiums paid.
Death benefit
The death benefit payable will be the higher of the fund value or 105% of the premiums paid.
Tax Benefits
They can be claimed as per Section 80C and Sec 10(10A)(iii) of Income Tax Act, 1961.
Eligibility Details
Vesting Age
Age at Entry: 45-75 years
Entry Age
Age at Entry: 18-65 years
Premium Payment Term
Single Pay|8 Pay|10 Pay|15 Pay
Policy Term
10|15 to 35
Premium Payment Frequency
Annual|Single Pay|Quarterly|Monthly|Half Yearly
HDFC Life - Assured Pension Plan
This is a unit-linked pension plan which comes with loyalty additions in the form of pension multipliers.
Product Benefits
Vesting Benefit
The vesting benefit payable will be a higher of fund value or assured vesting benefit, where assured vesting benefit can be calculated as:
[101% +1% * (Policy Term minus Premium Paying Term)] * Total premiums paid.
Death benefit
The death benefit payable will be the higher of the fund value or 105% of the premiums paid.
Tax Benefits
As available under Section 80C and Sec 10(10A)(iii) of Income Tax Act, 1961.
Pension Multiplier
Loyalty Additions will start from the end of 11th policy year.
Eligibility Details
Vesting Age
45 - 75 years
Entry Age
18 - 65 years
Premium Payment Term
Single Pay: 10|15 to 35 years
8 Pay: 10|15 to 35 years
10 Pay: 10|15 to 35 years
15 Pay: 15 to 35 years
Premium Payment Frequency
Regular and Limited Pay:
Annual: Rs. 24000
Half Yearly: Rs. 12000
Quarterly: Rs. 6000
Monthly: Rs. 2000
Single Pay: NA
Single Pay:
Rs. 50000
No such limit on maximum amount.
ICICI Pru - Easy Retirement
This is a unit-linked pension plan which comes with guaranteed benefit on the money you invest.
Product Benefits
Assured Benefit
Upon maturity, you will receive assured benefit or fund value, where assured benefit will be:
Assured Benefit = 101% of the (sum of all premiums paid and Top ups, if any)
Death benefit
The higher of Fund Value or Guaranteed Death Benefit will be payable, where Guaranteed Death Benefit will be 105% of the (sum of all premiums paid and Top ups, if any)
Top ups
Invest in top-ups with a minimum amount of Rs. 2,000/-
Eligibility Details
Premium
Rs. 48,000
No such limit on maximum
Premium Payment Frequency
Annual/Semi-Annual/Monthly
Age at Entry
35 - 70 years
Vesting Age
45 - 80 years
Premium Payment Term
5|10|Full Policy Term
Policy Term
10|15|20|25|30 years
Reliance Nippon Life - Smart Pension Plan
This is a unit linked non-participating pension plan which comes with guaranteed returns and regular income to help meet your retirement goals.
Product Benefits
Survival/Maturity Benefit
The amount payable will be higher of the total of balances in the unit account as on the Maturity/Vesting Date or 101% of the total premiums paid (including Top-ups, if any).
Death benefit
The amount payable will be higher of the total of balances in the unit account as on the date of intimation of death or 105% of the total premiums paid (including Top-ups, if any).
Surrender Benefit
Post 5 policy years, the amount payable will be the Fund Value under the base policy (including Top-ups) less applicable Discontinuance Charges, if any.
Loyalty Additions
Post 6th policy year, a loyalty addition of 1% will be given every year at an increasing rate.
Eligibility Details
Criteria
Minimum
Maximum
Age at Entry
18 years
65 years
Policy Term
Single Premium: 10 years
Limited/Regular Premium: 15 years
30 years
Premium Paying Terms
10 years
30 years
Vesting Age
45 years
75 years
>
Premium Frequency
Annual, Half-yearly, Quarterly, Monthly and Single
-
Single Premium Pay
Rs. 50,000
No Limit
Top-up
Rs. 5,000
No Limit
Bajaj Allianz - Pension Guarantee
This is an online, non-linked and no-par immediate annuity plan which comes with the guarantee of regular income post retirement.
Product Benefits
Annuity Options
Life annuity: Option A
The annuity is paid to the annuitant as long as he/she is alive.
On death of the annuitant, any outstanding annuity installment as on the date of death will be paid to the nominee/ legal heir.
Life annuity with Return of Purchase Price: Option B
The annuity is paid to the annuitant as long as he/she is alive.
On death of the annuitant, the purchase price and any outstanding annuity installment as on the date of death will be paid to the nominee/ legal heir
Annuity Certain for period 5 years, 10 years, 15 years , 20 years and life thereafter: Option C
The annuity is paid to the annuitant as long as he/she is alive.
On death of the annuitant before the expiry of the chosen certain period, annuity is paid to the nominee/ legal heir for the remaining chosen certain period.
On death of the annuitant after the expiry of the chosen certain period, any outstanding annuity installment as on the date of death will be paid to the nominee/ legal heir.
Joint Life Last Survivor with 50% of annuity to spouse: Option D
The annuitant and his/her spouse are covered under the policy.
The annuity is paid to the annuitant as long as he/she is alive.
On death of the annuitant, if the spouse is alive, any outstanding annuity installment as on the date of death of the annuitant will be paid and 50% of the annuity installment is payable to the spouse, as long as the spouse is alive.
On death of the spouse, if annuitant is alive, there is no change in the annuity payment
On death of the spouse, after the death of the annuitant, any outstanding annuity installment as on the date of death of the spouse will be paid to nominee/ legal heir.
Joint Life Last Survivor with Return of Purchase Price on death of Last Survivor (100% of annuity to spouse): Option E
The annuitant and his/her spouse are covered under the policy.
The annuity is paid to the annuitant and/or spouse as long as at least one of them is alive.
On the death of the first member, there is no change in the annuity payment.
On death of the last survivor, the purchase price plus any outstanding annuity installment as on the date of death of the last survivor will be paid to the nominee/ legal heir.
Joint Life Last Survivor with 100% of annuity to spouse: Option F
The annuitant and his/her spouse are covered under the policy.
The annuity is paid to the annuitant or spouse as long as at least one of them is alive.
On death of the annuitant, if the spouse is alive, any outstanding annuity installment as on the date of death of the annuitant will be paid and 100% of the annuity installment is payable to the spouse, as long as the spouse is alive.
On death of the spouse if annuitant is alive, there is no change in the annuity payment.
On death of the spouse after the death of the annuitant, any outstanding annuity installment as on the date of death of the spouse will be paid to the nominee/ legal heir.
Free Look Period
15 Days
Eligibility Details
Minimum Age at Entry
37 years
For option D, E & F: annuitant & spouse’s minimum age at entry is at least 37 years. If life assured (annuitant)/ nominee/ legal-heirs under a deferred pension policy with BALIC uses the proceeds from that policy to purchase this policy, then the given minimum age at entry will not apply and shall be as given below:
Under annuity Options A, B & C, the annuitant’s minimum age at entry is 0 years Under Options D, E & F, annuitant’s minimum age at entry is 18 years. The life assured and spouse’s age at entry has to be at least 18 years
Maximum Age at Entry
80 years
For option D, E & F annuitant and spouse’s maximum age at entry is 80 years. If life assured (annuitant)/ nominee/ legal-heirs under a deferred pension policy with BALIC uses the proceeds from that policy to purchase this policy, then the given maximum age at entry will not apply and the annuitant’s maximum age at entry is 100 years.
Under Options D, E & F, the annuitant and spouse’s age at entry has to be at most 100 years.
Purchase Price
Rs. 25,000 - minimum.
No such limit on maximum.
Minimum Annuity per installment
Yearly – Rs. 12,000/-
Max Life Guaranteed Lifetime Income Plan
This is a non-linked non participating immediate annuity plan which offers a lifelong regular income source.
Product Benefits
Annuity Options
1. Single Life Annuity for life (without any death benefit)
2. Single Life Annuity for life with Return of Premium (ROP) payable on death.
3. Joint Life Annuity for life (without any death benefit).
4. Joint Life Annuity for life with Return of Premium (ROP) payable on death of the last survivor.
Annuity Payout Modes
Monthly: 0.08,
Quarterly: 0.24 and
Semi-Annually: 0.49.
On the basis of modal factors and modal period.
Payouts
In case of death, the nominee will receive 100% of the purchase price (excluding all applicable taxes, cess and levies as imposed by the Government) for Single Life / Joint Life Annuity Plans with Return of Premium (ROP).
Eligibility Details
Age
50 - 80 years
Premium
Rs. 1,00,000 – min
No such limit on maximum
Aditya Birla Sun Life Empower Pension
This is a unit-linked non-participating pension plan which comes with guaranteed additions over the policy tenure.
Product Benefits
Vesting Benefit
The amount payable will be higher of Guaranteed Vesting Benefit or the Fund Value.
Death Benefit
The amount payable will be greater of Guaranteed Death Benefit or Fund Value as on date of intimation of death. The Guaranteed Death Benefit is the greater of 105% of all basic premiums paid or Accumulation of all basic premiums paid till date at a compounding guaranteed rate.
Tax Benefit
As available under Section 80CCC and Section 10(10A) of the Income Tax Act, 1961.
Eligibility Details
Entry Age (age on last birthday)
25 –70 years
Accumulation Period
5 – 30 years subject to maximum vesting age of 80 years
Disclaimer: Above mentioned premium is for a 25 years old Male. Premiums payable on a monthly basis.
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FAQs on Top 10 Pension Plans of India
Can I buy a pension plan?
Yes, you can select from any of the top ten mentioned pension plans above and check the eligibility details.
Can I have 2 pensions?
Yes, you can purchase more than two pension plans from different insurers.
Is NPS a good option?
Yes, it is an excellent option for retirement settlement.
What are the different types of pension plans?
The different types of pension plans are divided on the basis of payouts. To name a few - Deferred Annuity, Immediate Annuity, Annuity Certain, With Cover Pension Plan, Life Annuity, NPS, Pension Funds and Guaranteed Period Annuity Plan.
What are the two types of pensions?
The two types of pensions are Deferred Annuity and Immediate Annuity.
What is final salary pension?
A final salary pension is the set level of pension amount provided at retirement on the basis of your savings and earning at the time of retirement.
What is national pension scheme of Government of India?
NPS or New Pension Scheme or National Pension System is a pension plan introduced by the Government of India aimed at providing pension and investment to citizens of India. This scheme comes in two options, Tier 1 where the corpus is non-withdrawable and Tier 2, where the corpus is withdrawable. The Tier 2 account can only be availed post creation of the basic Tier 1 account.
What is the best pension policy in India?
One can chose the best applicable pension plan as per their needs from the options listed above.
What's the difference between pension and retirement?
Pension is the monetary amount received during retirement, while retirement is the phase of life post-employment.
Where should I invest my retirement benefits in India?
You can invest in any of the top 10 funds mentioned above to avail the best of retirement benefits.
Which bank is best for NPS?
You can approach any bank for opening an NPS.
Which retirement plan is best for me?
This depends on your standard of living and the financial goals of you and your family.
Will you have enough to retire?
A carefully invested pension plan will provide you more than enough for retirement.
