Pradhan Mantri Vaya Vandana Yojana

Pradhan Mantri Vaya Vandana Yojana (2020 Modified) is a simplified pension plan subsidized by the Government of India through LIC. The LIC Pradhan Mantri Vaya Vandana Yojana comes with a modified pension rate and is available for sale till 31st March 2023. These rates may be updated by the Finance Ministry at the start of each year. For the year 2022-23, the assured rate of monthly pension will be 7.4% per annum. 

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This pension scheme was introduced for senior citizens after the success of a similar scheme called the LIC Varishtha Pension Bima Yojana. LIC is solely responsible for the sale of these schemes.

Key Features of the Pradhan Mantri Vaya Vandana Yojana for Senior Citizens

  • Only people aged 60 years or above are eligible to invest in this scheme.

  • The latest LIC Pradhan Mantri Vaya Vandana Yojana interest rate for 2022 is 7.40% per annum. The pension rate remained the same in 2020-21 and 2021-22 as well.

  • There is a cap on the minimum and maximum pension amount and purchase price as per the mode of payment chosen by the pensioner (see Eligibility Conditions).

  • The purchase price has to be paid in a lump sum.

  • LIC offers a refund of the purchase price if the pensioner finds the scheme unsatisfactory and returns it within the free look period.

Benefits Offered Under LIC Pradhan Mantri Vaya Vandana Yojana Policy

It comes packed with the following benefits for senior citizens:

  1. A regular pension for 10 years

    The assured pension amount shall be paid out regularly as per the interval chosen by the pensioner. If you want a monthly pension, LIC will pay out a fixed pension amount at the defined rate every month for 10 years (unless you die during this period).

  2. Death benefits for family & dependents

    If you die within the policy term of 10 years, LIC will return the purchase price paid by you to the assigned nominee.

  3. Maturity benefits from surviving 10 years

    If the insured individual survives to the very end of the policy tenure of 10 years, the purchase price, including the final pension installment, will be paid by LIC.

  4. Surrender benefits on premature exit

    This benefit can be availed under exceptional events like the assured life requiring money for the treatments of any critical/terminal illness of self or spouse. In such cases, LIC will pay you an S.V (Surrender Value), which is around 98% of the original Purchase Price.

  5. Loans can be availed in financial emergencies

    If you find yourself in urgent need of capital during the policy tenure, you can request LIC for a loan against the policy benefits. The loan facility can be availed after the completion of 3 policy years and is subject to a maximum loan of 75% of the Purchase Price.

    The Pradhan Mantri Vaya Vandana Yojana interest rate 2021 on loans availed till 30th April 2021 is 9.5% p.a.

  6. Increased savings through income tax benefits

    One can avail of the income tax benefits on premiums under Section 80C and on the death & maturity benefits under Section 10(10D) of the Income Tax Act of 1969.

    * Tax benefits are subjected to certain changes in the tax laws

Eligibility Conditions

Certain parameters have to be met to enjoy the benefits of this pension scheme for senior citizens.

Criteria Minimum Maximum
Entry Age (completed) 60 years No limit
Policy Term 10 years (fixed)
Mode of Purchase Price Payment One-time lump sum payment
Purchase Price Monthly: Rs.1,62,162
Quarterly: Rs.1,61,074
Half-yearly: Rs.1,59,574
Yearly: Rs. 63,960
Monthly: Rs.15,00,000
Quarterly: Rs.14,89,933
Half-yearly: Rs.14,76,064
Yearly: Rs.14,49,086
Mode of Pension Payment Monthly, quarterly, half-yearly, or yearly
Pension Amount Monthly: Rs. 1,000
Quarterly: Rs. 3,000
Half-yearly: Rs. 6,000
Yearly: Rs. 12,000
Monthly: Rs.9,250
Quarterly: Rs.27,750
Half-yearly: Rs.55,500
Yearly: Rs.1,11,000

How does the LIC Pradhan Mantri Vaya Vandana Yojana Work?

Let’s assume that you are a 60-year-old male at the time of purchasing the policy. You pay a purchase price of Rs.10 lakhs in the scheme. You want to secure a monthly pension for 10 years. The annual pension rate of 7.40% p.a will be divided into 12 payments for every month in a year.

Here are the benefits you will be entitled to under the following circumstances -

  1. Monthly pension from the age of 60 to 70

    Your monthly pension will amount to Rs (10,00,000 x 7.40%)/12 = Rs.6,167 payable across 10 years.

  2. If you die in the 6th policy year

    • You will be entitled to a monthly pension of Rs.6,167 for the first 5 policy years.

    • Your family will get the Rs.10 lakhs that you had invested in the scheme.

  3. If you survive 10 policy years

    • A monthly pension worth Rs.6,167 will be credited to your account throughout the tenure of 10 years.

    • The purchase price of Rs.10 lakhs will be returned to you after completing 10 years.

    You can use the Pradhan Mantri Vaya Vandana Yojana Calculator to calculate the pension amount against the purchase price.

What Are the Documents Required to Buy This Policy?

One is advised to keep the mentioned documents ready to buy Pradhan Mantri Vaya Vandana Yojana:

  • Identification purposes: Passport, Aadhar card, Birth certificate, driving license, Voter ID card, Ration card, etc.

  • For address verification: Above mentioned documents, Gas bill, Electricity bill, maintenance bill, etc.

  • Income tax statements, Bank statements, photographs, Credit scores, etc., may also be needed.

Exclusions of Pradhan Mantri Vaya Vandana Yojana Plan

It covers all deaths irrespective of whether it is natural or resulting from suicide, accidents, etc. The purchase price shall be returned in full if it occurs within the policy term.


  • Q: What is the assured pension rate with Pradhan Mantri Vaya Vandana Yojana?

    Ans: The plan will provide a guaranteed pension of 7.40% p.a., which would be paid monthly.
  • Q: How to know the Pradhan Mantri Vaya Vandana Yojana Status?

    Ans: To know the Pradhan Mantri Vaya Vandana Yojana Status, one can contact LIC or log in to its online portal.
  • Q: Can one terminate Pradhan Mantri Vaya Vandana Yojana?

    Ans: If the insured individual is not satisfied with any of the details in the policy, he or she might return the plan to the company within a free look period of 15 days. If the policy was bought online, the free look period is 30 days.
  • Q: What is the interest rate on a Loan taken against the Pradhan Mantri Vaya Vandana Yojana scheme?

    Ans: For the loan given till 30th April of 2021, the applicable rate of interest would be 9.5% p.a.
  • Q: Is GST applicable to Pradhan Mantri Vaya Vandana Yojana?

    Ans: Yes, and the amount of Tax (GST) paid should not be considered for calculating the benefits payable within the plan.
  • Q: Can Pradhan Mantri Vaya Vandana Yojana be bought from a Third-party insurer?

    Ans: No, the LIC of India is solely authorized to sell this policy/ scheme.
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Pradhan Mantri Vaya Vandana Yojana Reviews & Ratings

4.6 / 5 (Based on 9 Reviews)
(Showing Newest 9 reviews)
Namakkal, April 06, 2021
Secure future
The Lic India pension was bought by me 2 years back so that I can secure my future and my family’s future. I really love it and found the plan much impressive. I have search for various good plans at reasonable premium.
Bairabi, April 05, 2021
A great alternative
I have found a best alternative for me along with my job. I have got the lic India pension plan policy. It is a good plan which I have bought for securing my future and it has been a wonderful plan for everyone.
Aruppukkottai, April 01, 2021
Lot of features
In my Lic India pension plan I got to know about various features which has enhanced my future. I am future secured along with my job.
Belpara, March 02, 2021
I choose the Lic India pension plan because I wanted to secure my and my family’s future. It is one of the guaranteed pay out plans available. A good place to invest and get the best pay out to be happy in the future.
Edayirikkapuzha, March 02, 2021
Regular income plan
I was looking for a retirement plan so that it can give me benefits in my future. I got to know about Lic India pension plan from my friend. The premium payment is quite easy to do and I easily got along with this plan because I got various benefits into the same. Great plans and would recommend to my friends.
Dharur, February 10, 2021
Secure future
I bought this lic India pension plan recently and I really like it. I found the financial stability and coverage under this plan. It is best plan for my retirement.
Mumbai, July 20, 2016
LIC Insurance
The pension plan of mine is very nice. It provide good returns in future and the coming time is tension free. Premium is low, and the special thing of the plan is that it is lic pension plan, the trusted company from the ages. I'm fully satisfied with my insurance plan.
Noida, July 20, 2016
Pension Policy
My lic pension plan is the best policy. Premium is less policy coverage is high. Claiming procedure is easy because of fast service facilitate by the executives 24X7. Updates are send regularly to my email address. The online renewals are also easy to make. Good future investment.
Bangalore, May 13, 2016
I secure my future by buying the lic pension plan. The policy coverage is fantastic approx. 88% and the claims are even better. Service is fast and on time. Good behaviour of executives and staff members is the best part. Good job.
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