Millennium Post

LIC’s Varishtha Pension Bima Yojna gives old a new lifeline

Union Government has re-introduced its much sought-after scheme Varishtha Pension Bima Yojna (VPBY) loaded with unique features for senior citizens in association with country’s largest insurance group Life Insurance Corporation of India (LIC). 

The scheme is revived for a year, till 14 August, 2015. With myriad number of plans already available in the market, Varishtha Pension Bima Yojna is the only pension scheme which promises the highest annual return of 9.38 per cent. Under the scheme, during the lifetime of a pensioner, a pension will be payable in the form of immediate annuity and on death of the pensioner, the purchase price will be refunded to the nominee or legal heir of the pensioner. It is a single premium pension policy for senior citizens, with pension starting to flow in immediately.

Depending on the mode of payment chosen, the first instalment of pension will be paid after 1 year, 6 months, 3 months or 1 month from the date of purchase of scheme. A person can have a minimum pension of Rs 6,000 per year to maximum of Rs 60,000 per year. The plan also provides the option of surrendering the policy after completion of 15 years. The surrender value payable will be refund of purchase price. Under special circumstances, where the pensioner needs money for the treatment of critical illness of self or spouse, the policy also gives the option of early surrender.

In that scenario, surrender value payable will be 98 per cent of purchase price. Loan facility is also available after completion of three policy years. The maximum loan that can be granted will be 75 per cent of the purchase price, and the rate of interest to be charged will be determined by the corporation from time to time and loan interest will be recovered from pension amount payable.
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