Review of LIC Senior Citizen Pension Scheme

Pradhan Mantri Vaya Vandana Pension Yojana (PMVVY) is specially designed for individuals above the age of 60 and it is an effective long-term saving option that has an exquisite feature and offers unmatched security. This plan allows the policyholder to look after their day-to-day needs post their retirement and ensures stress-free life. Life Insurance Corporation of India is the administrator of PMVVY on behalf of the Government of India.

What is Pradhan Mantri Vaya Vandana Yojna (PMVVY)?

Pradhan Mantri Vaya Vandana Yojana is a pension scheme that is launched by the Government of India. The modified scheme includes pension rates and an extended period of sale for 3 years from the financial year 2020-21 up till 31st March 2023. The plan also offers a loan facility as well to look after the financial needs.

Under this plan, senior citizens can receive a minimum pension of Rs. 1,000 per month and a maximum pension of Rs. 10,000 per month based on the invested amount for the initial 10 years of the policy term.

Note: The plan was withdrawn by the company on 31.03.2023, and is no longer available for sale.

Key Features of LIC Senior Citizen Pension Scheme:

• If the policyholder survives during the whole policy term, i.e., 10 years, pension at the termination of each period will be paid.

• In case of the demise of the pensioner during the policy tenure of 10 years, the purchase price of the policy is refunded to the nominee of the policy.

• In case the pensioner survives the entire 10 years of the policy then they receive the purchase price of the policy along with the final pension installments if any.

• The Pradhan Mantri Vaya Vandana Yojna (PMVVY) also provides a loan facility after the policy completes 3 years. The pensioner can be granted a maximum loan of 75% of the purchased price. For the entire tenure of the loan, an interest rate is applicable per annum which is paid at periodic intervals.

• The scheme can be purchased on a yearly, half-yearly, quarterly, or monthly basis as per one’s convenience .

Eligibility Criteria of Pradhan Mantri Vaya Vandana Yojana

Benefits of Pradhan Mantri Vaya Vandana Yojna

• Regular flow of income for ten years

  The policyholder will receive a regular flow of income at specified intervals.The policyholder can opt for monthly pension at a defined rate each month for ten years.

• Death Benefit

  If the policyholder dies within the 10-year policy term, LIC will reimburse the purchase price to the nominee.

• Maturity Benefit

  The purchase amount, along with the last pension installment, will be reimbursed if the insured person lives till the maturity of the policy's ten-year term.

• Surrender Benefit

  This benefit may be used in unusual circumstances, such as when an insured person needs money for medical care due to a serious or fatal sickness. In such circumstances, the plan will offer Surrender Value which is around 98% of the original Buying Price.

• Loan Facility

  The plan offers loan facility Benefits in case of financial emergency. The plan offers a maximum loan of 75% of the purchase price.

Summing it up

Pradhan Mantri Vaya Vandana Yojana is a government subsidized pension Scheme specially for senior citizens aged 60 years and above. The policy was recently withdrawn by the company, and is no longer available for sale.