LIC New Pension Plus Plan
LIC New Pension Plus Plan is an individual savings and pension unit-linked plan designed to help policyholders build a secure corpus through systematic and disciplined savings. These savings can generate a regular pension for you during retirement, providing a reliable source of income to secure your post-retirement life.
LIC New Pension Plus Plan- An Overview
LIC New Pension Plus Plan 867 is a unit-linked pension plan by the LIC. The total corpus built till retirement can be converted into a regular income. With this plan, you can make guaranteed additions to the fund value, enhance security further, and increase the final payout. The plan offers single and regular premium paying options with four different types of investment funds.
Key Features of the LIC New Pension Plus Plan
Flexibility in Premium Payment
Pay premiums as a lump sum one-time amount or a fixed sum every month, quarter, 6 months, or year during the policy term. The minimum premium amount that one has to invest is fixed for each mode:Single Premium – Rs 1 Lakh
Regular Premium – Rs 30,000 (yearly), Rs 16,000 (half-yearly), Rs 9,000 (quarterly), Rs 3,000 (monthly)
Pension for life
The total amount that one will have accumulated over the years can be annuitised. Annuitisation is converting a lump sum into a series of fixed payments, usually for the rest of one’s life. This is done to ensure a regular income during retirement.Market-linked Returns
The unit-linked nature of the plan allows policyholders to invest in the choice of their funds. Based on the performance of these funds in the market, policyholders stand a chance to generate increased returns. They can switch between these funds for free at least 4 times a year.Partial Withdrawals
After a 5-year lock-in under the LIC New Pension Plus plan (Plan No 867), you can make up to three partial withdrawals. Under both premium paying options, the maximum withdrawal amount is 25% of the Unit Fund Value.Settlement Option
Under this LIC new pension plan, nominees/beneficiaries can choose a Settlement Option to receive death benefits in installments (ranging from yearly to monthly). This payout can be monthly, quarterly, half-yearly, or yearly over a maximum of 5 years.Option to Extend Vesting Date
You can extend your vesting date (the age when you start receiving your pension). This means you can choose to keep your policy active for more years, up to 42 years. You can either continue paying premiums or keep the policy paid-up without making new payments.Choice of Funds
The New Pension Plus Plan offers a choice of 4 investment fund options that one can choose based on their risk appetite. These are:Fund Risk Pension Bond Fund Low Pension Secured Fund Low to Medium Pension Balanced Fund Medium Pension Growth Fund High Fund Switching
The New LIC Pension Plus plan allows you to switch between four investment funds up to four times per year at no cost; however, additional switches beyond this limit cost Rs. 100 per switch. Once you switch the funds, the entire unit fund value is moved to a new fund of your choice.
LIC New Pension Plus Plan Eligibility Criteria
| Criteria | Minimum | Maximum |
| Entry Age | 25 years | 75 years |
| Premium Amount | Single premium: Rs 1 Lakh Regular Premium: Yearly: Rs 30,000 Half-Yearly: Rs 16,000 Quarterly: Rs 9,000 Monthly: Rs 3,000 | No Limit |
| Policy Term | 10 years | 42 years |
| Age at Maturity/Vesting | 35 years | 85 years |
| Premium Payment Term | Single Premium: One Time Regular Premium: Same as policy term | |
LIC New Pension Plus Plan Benefits
Death Benefit
In case of the death of the life insured during the policy’s tenure, the death benefit is paid to the beneficiary of the policy. The benefit paid is equal to the higher of the following.
Unit Fund Value as on the date of intimation of death or
Assured Death Benefit
Maturity Benefit
If the policyholder survives till the end of the policy term, the plan will pay the maturity benefit equal to the Unit Fund Value.
Guaranteed Additions
LIC of India adds a guaranteed fixed amount to the fund value of your active LIC 867 Plan at the end of the following years till the date of maturity:
Policy Year Guaranteed Additions p.a. % of Annual Premium % of Single Premium 6 5% 4% 10 10% 5% 11-15 4% 1.25% 16-20 5.5% 1.5% 21-25 7% 2% 26-30 8.75% 2.5% 31-35 10.75% 3% 36-40 13% 3.75% 41-42 15.5% 4.5%
LIC Pension Plus Plan Sample Benefit Illustration
Let’s say a 30-year-old invests an annual premium of Rs 30,000 throughout the policy term of 42 years. This brings the total investment to Rs 12,60,000.
Assuming that it is being invested in a mix of Secured, Balanced, and Growth funds with an 8% return rate, the calculated benefits come out to be:
Total maturity value – Rs 59,92,991
Pension per year – Rs 7,06,928
You can use the LIC New Pension Plus plan no 867 calculator tool to calculate the plan’s benefits per your requirements.
New LIC Pension Plus Plan Charges
Under this LIC new pension plan, the following charges are applicable:
Premium Allocation Charge
This charge is deducted directly from your premium before it is invested in funds. It varies for online/offline and single/regular premium options. For instance, online regular premiums attract lower charges, starting at 2.5% in the first year as compared to 7% in offline mode.
Policy Administration Charge
Charged monthly during the first five years by cancelling units from your fund. The amount depends on the premium amount and mode of payment (monthly, quarterly, etc.). No charges apply after the 6th policy year.
Fund Management Charge (FMC)
This is a fee charged as a percentage of your total investment amount. It’s 1.35% p.a. of Unit Fund for active policies and 0.5% p.a. of Unit Fund for discontinued ones.
Switching Charge
This charge applies when you switch your investment from one fund to another by deducting units from the fund value. Four switches are free each year; after that, a charge of Rs 100 per switch applies.
Discontinuance Charge
It is only charged if you exit the policy during the first 4 years. The fee is based on your premium and policy year.
Partial Withdrawal Charge
A charge of Rs 100 is applied each time you partially withdraw from your Unit Fund. The amount is deducted by cancelling an equivalent number of units from your fund on the date of withdrawal.
Tax Charge
Applicable taxes, like GST, are levied on all/any other charges as per government regulations.
Miscellaneous Charge
It is charged if you make changes like altering premium mode under a regular premium policy. A fee of ₹100 is charged by deducting appropriate number of units from the fund value.
LIC New Pension Plus Plan no 867 Details
Grace Period
A grace period of 30 days for quarterly, half-yearly and yearly premiums and 15 days for monthly premiums is provided to pay the due premiums.Surrender
If the policy is surrendered before the lock-in period of 5 years, the fund value shall remain invested as part of a Discontinued Policy Fund.
If the policy is surrendered after 5 years, LIC will pay the unit fund value to the policyholder.Policy Revival
The policy can be revived during the revival period of 3 years if the due premium payments are made.Free Look Period
A free look period of 30 days, from the date when policy document is received, is offered to policyholders, during which they can return it if they are unsatisfied with the terms and conditions.
Exclusions
In case of suicide within 12 months from policy issuance or policy revival, if applicable, the nominee or beneficiary will be paid the the Unit Fund Value available till date of death intimated to LIC. No other claim will be payable.
