LIC Varishtha Pension Bima Yojana

LIC Varishtha Pension Bima Yojana Plan is a pension scheme advocated by the Government of India in the Union Budget of the year 2014 – 2015.  It is a scheme for the benefit of senior citizens in India and can be availed only by those above the age of 60 years.  The Plan was announced by the Finance Minister (2014), MrArunJaitley of India.

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The Varishtha Pension Bima Yojana by LIC is beneficial to senior citizens as it guarantees them a small income after retirement.

The pensioner may claim his pension every month or even opt for a quarterly, semi-annual or annual pension amount.  The Corporation will make the payment only through ECS/NEFT. 

A free look period of 15 days is provided under the LIC Varishtha Pension Bima Yojana Plan.If a pensioner is unsatisfied with the proceeds of the plan, he can surrender it within this 15 day look period at no additional cost apart from the stamp duty.

Eligibility Criteria of LIC Varishtha Pension Bima Yojana

The eligibility to purchase a LIC Varishtha Pension Bima Yojana Policyis as follows:

  • The minimum age of entry is 60 years (completed)
  • No limit on the maximum age of entry is put.
  • The minimum pension is as follows:

Monthly Pension Amount: Rs 500

            Quarterly Pension Amount: Rs 1500

            Half-yearly Pension Amount: Rs 3000 

Yearly Pension Amount: Rs 6000 

  • The maximum pension is as follows:

Monthly Pension Amount: Rs 5000

Quarterly Pension Amount: Rs 15000

Half-yearly Pension Amount: Rs 30000

 Yearly Pension Amount: Rs 60000

Core Benefits of the Plan 

The following benefits can be availed under the LIC Varishtha Pension Bima Yojana:

  1. Pension Benefits

    The pension installment is payable to the pensioner during his lifetime.  The pensioner himself can choose the mode of payment. The minimum and maximum pension values are fixed, and a pensioner will receive a pension as per the category.

  2. Death Benefits

    The Policy Purchase Price is to be reimbursed to the beneficiary in the event of the death of the pensioner. This makes it a reliable product with a guaranteed return.

  3. Policy Loan

    The pensioner is eligible to apply for a loan under this policy provided the duration of three years has been completed from the date of policy initiation.  The maximum amount of loan that the pensioner can receive under this plan is 75% of the purchase price. The Corporation will then hold the policy in the form of security in order to facilitate the return of the loan and the interest levied upon it.

    Interest on the loan will accumulate according to the frequency of payment of pension under the policy.  The interest is taken from the pension installment at a predetermined rate.  The Corporation will decide the rate when issuing the loan.  The loan recovery will begin from the installment of the pension released by the Corporation immediately after the loan has been issued.

    In the event that the policyholder decides to surrender the policy or the LIC Varishtha Pension Bima Yojana Policybeing converted into a death policy, the Corporation has the right to claim the amount of the outstanding loan and any other interest from the policy monies.  

  4. Surrender Benefits

    The planis eligible for surrender after the duration of 15 years from the date of policy initiation.  The Surrender Value will be equivalent to the Purchase Price of the plan.  

    A special clause has been inserted into the policy. If the pensioner or his spouse needs financial assistance for treating a critical or a terminal disease, he is allowed to surrender the policy before completing 15 years of tenure.  In such an event, the Surrender Value of the plan becomes equivalent to 98% of the Purchase Price.

Documents Required

The documents required for a pensioner to purchase a LIC Varishtha Pension Bima Yojana Policyare as follows:

For the purpose of claiming, the documents required are - 

  • Claims form
  • Original policy document
  • NEFT mandate
  • Proof of title/death

For the purpose of payment of pension installment, the documents required are - 

  • Existence certificate
  • Age proof

For the purpose of surrendering the policy and claiming the benefit, the documents required are -

  • Discharge form
  • Original policy document
  • Proof of medical treatment in the event that the policy is being surrendered before the completion of 15 years.
  • Age proof

The Process of Buying LIC Varishtha Pension Bima Yojana Online

Online purchase of the LIC Varishtha Pension Bima Yojana Planis the most time-saving method to purchase the policy.  It ensures that senior citizens need not spend a lot of time and effort visiting the LIC office and standing in long lines, waiting for their turn.  It also saves them the added cost that they would otherwise incur if they would purchase the policy through a registered aggregator of the Corporation.

To purchase the policy, the following steps are to be undertaken:

Step 1: Locate the website of LIC online and click on Products.

Step 2: Then click on the “Pension Plans” button.

Step 3: A list of all the pension plans provided by LIC will appear.

Step 4: Locate “LIC Varishtha Pension Bima Yojana” and click on it.

Step 5: Click on the “Buy Online” option.

Step 6: Enter the details being requested, e.g., name, gender, date of birth, address, and contact number.

Step 7: Select a convenient mode of payment.

Step 8: Make the online payment and complete the Process.

Key Exclusions

 The LIC Varishtha Pension Bima Yojana Planis available for senior citizens above the age of 60 years.  If the pensioner’s age at entry in the Plan is found to be incorrect, then he will be automatically excluded from the plan.

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Written By: PolicyBazaar - Updated: 09 July 2021
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