- About Coverfox
Pradhan Mantri Vaya Vandana Yojana is a pension scheme for senior citizens which has been introduced by the Government of India. The scheme was launched officially on 21st July 2017 by Finance Minister of India Arun Jaitley, although it has been available for purchase since its soft launch on 4th May 2017. The scheme is a boon for senior citizens in the times of falling interest rates. The aim of the scheme is to give senior citizens regular pension. The scheme can be purchased offline and online through Life Insurance Corporation of India as they have been given sole rights to operate it. LIC has sold 58,152 PMVVY schemes generating INR. 2,705 crore since its launch on May 4, 2017.
The scheme has three major benefits which are listed below:
Regular Pension Payment: The scheme offers regular pension payment for 10 years to senior citizens on chosen mode of monthly, quarterly, half yearly or yearly basis.
Death Benefit: If unfortunately, the policyholder dies of any causes, then the purchase price of the scheme shall be refunded to the nominee.
Maturity Benefit: The scheme also offers maturity benefit. If the policy holder survives the duration of the scheme then he/she is entitled to receive final pensions and purchase price is returned with the final pension installment.
Loan benefit : After three years in the scheme, a loan of 75% is available on the purchase price. Interest of the loan will be adjusted in the pension installments and loan of the amount will be recovered from claim proceeds.
Free Look Period: The policy offers free look period of 15 days if purchased offline and 30 days if it was purchased online. If the policyholder is not satisfied with the terms and condition he/she may return the policy to the corporation and get the purchase price deposited minus the charges on stamp duty paid if any.
Surrender Value : The scheme allows you to withdraw from the scheme during the policy term under exceptional circumstances such as money required in an emergency for treatment of critical or terminal illness of self or spouse. The surrender value paid back will be 98% of purchase price.
Exclusions of Pradhan Mantri Vaya Vandana Yojana : There are no exclusions under Pradhan Mantri Vaya Vandana Yojana. Even on suicide, the scheme will pay back the full purchase price.
Pradhan Mantri Vaya Vandana Yojana is a good initiative taken by the Government of India for senior citizens to have a systematic regular pension through an organised and well-planned investment scheme. The flexibility in withdrawal and loan facility after three years are really good customer friendly features given in the scheme. Return of purchase price on death or if the pensioner survives the term is a good reason to invest for Senior Citizens in this scheme especially in the scenarios of falling interest rates.