Best Annuity Plans to Invest for Retirement

Planning for retirement is one of the important aspects of financial planning to ensure a financially secure life after retirement. This is when the annuity plan comes into play. An annuity plan is specifically designed to provide a regular and guaranteed source of income during the retirement phase.  As during the retirement phase, not everyone has a regular source of income, thus it is important to have an alternative source of income so that you can maintain your lifestyle and ensure financial stability. At this time, annuity plans work as a boon.

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What is an Annuity Plan?

An annuity plan helps the individual to receive regular income in the form of annuities after retirement in exchange for the investments made in the form of lump-sum or installments. In such plans, the life insurance organization invests the investor’s money and pays back the generated returns from it. The annuities can be paid either immediately after payment of the lump-sum amount or after completion of the specific tenure. 

Types of Annuity Plans

The following are the different types of annuity plans available for the investment.

Deferred Annuity

 The pension plans wherein the annuity starts after a specific date is known as a deferred annuity. The different phases of this plan are:

  • Accumulation Phase: A phase wherein you start to invest and accumulate cash and commence as soon as you pay the premium for the first time.
  • Vesting Phase: A date from which you start receiving the benefits of the policy as a pension.

Immediate Annuity

These plans do not have any accumulation phase and the benefits of the plan start from the phase of vesting. This type of plan can be purchased by paying the lump sum amount and the payment of the annuity starts instantly either for a lifetime or for a limited period.

Variable Annuity

In a variable annuity, the pay-outs are not fixed and it keeps varying. Under this annuity option, the investments are done in market-linked securities with an objective to gain a profitable return on investment. This means that the ROI of the main fund and the payouts entirely depend on the market performance of the fund. This annuity option is best suitable for individuals who have a high-risk appetite.

Fixed Annuity

In the fixed annuity plan, the annuity payouts of the plan remain the same for the entire tenure. A fixed annuity plan works the same as a fixed monthly pension and is a lucrative option of investment for individuals who wants to have a guaranteed and regular income.

Lump-sum Annuity

This is one of the most popular annuity options available in the market. This annuity plan provides the option of a lump-sum payout available only for a specific time period. However, in most cases, the individuals cannot withdraw the entire annuity amount as lump-sum.

Periodic Annuity

This annuity option is specifically designed to offer payouts to the individuals at regular intervals. The annuities can be paid either monthly or at specific intervals like at the end of the 5th, 10th, and 15th year.

Best Annuity Plans to Invest in India

Let’s take a look at the best annuity plans to invest in India.

1. Aditya Birla Sunlife Immediate Annuity Plan

This is a non-participating single premium plan, which ensures regular income after retirement. The plan offers the flexibility to choose from 6 different payout options to receive the annuity. The following are the features and benefits offered by the policy.

Features of Aditya Birla Sunlife Immediate Annuity Plan

  • The plan offers guaranteed regular income after retirement.
  • The policyholder can choose from 6 different payout options to receive the annuity.
  • The annuities are paid in different modes i.e. yearly, half-yearly, quarterly, and monthly from the date of purchase.
  • No medical test is required to purchase the plan.

Benefits Offered Aditya Birla Sunlife Immediate Annuity Plan

  • The plan ensures financial security to the individuals after retirement.
  • Tax benefits can be availed U/S 80C and 10(10D) of the Income Tax Act.
  • The annuity payouts are made immediately after the payment of the lump-sum amount.

2. Aviva Annuity Plus Plan

This is a traditional insurance plan, which is specifically designed to provide lifetime income to the individual after retirement. As a non-participating single premium immediate annuity plan, it provides a guaranteed income to the policyholder post-retirement. The following are the features and benefits offered by the plan.

Features of Aviva Annuity Plus Plan

  • The minimum entry age of the policy is 18 years, whereas, the maximum entry age of the policy is 80 years.
  • The minimum purchase price of the policy is Rs.25,000. There is no upper limit on the maximum purchase price.
  • The annuities are paid in different modes i.e. yearly, half-yearly, quarterly, and monthly from the date of purchase.

 Benefits offered by Aviva Annuity Plus Plan

  • The policyholder can choose from 7 different payout options to receive the annuity.
  • Tax benefits can be availed as per the prevailing tax law.
  • No medical test is required to purchase the policy.
  • The annuities are paid immediately after the payment of the lump-sum premium.

3. Exide Life New Immediate Annuity Plan

This is a non-participating, non-linked immediate annuity plan, which offers lifelong guaranteed annuity payouts to the individuals. Here are the features and benefits offered by the policy.

Features of Exide Life New Immediate Annuity Plan

  • Annuity payouts guaranteed for lifelong.
  • The plan offers flexible payout options to receive the annuity amount.
  • On the demise of the policyholder, the purchase price is fully refundable.

Benefits Offered Exide Life New Immediate

  • In case of the demise of the annuitant, the entire purchase price is paid back to the nominee as a death benefit.
  • No medical test is required to purchase the plan.
  • The annuity payouts can be made on yearly, half-yearly, quarterly, or monthly mode.
  • The annuities are paid immediately after the payment of the lump-sum premium.

4. Future Generali Immediate Annuity Plan

This is a traditional non-participating plan, which offers financial security after retirement in the form of regular income. Under this plan, the annuitant can start getting the premium immediately after paying the premium. The following are the features and benefits offered by the policy.

Features of Future Generali Immediate Annuity Plan

  • The minimum entry age of the policy is 40 years, whereas, the maximum entry age of the policy is 80 years.
  • The minimum purchase price of the policy is Rs.30,000. There is no upper limit on the maximum purchase price.
  • The policy term continues until the annuitant is alive.

Benefits Offered by Future Generali Immediate Annuity Plan

  • The plan offers lifetime income to the annuitant.
  • The plan offers flexible payout modes i.e monthly or yearly.
  • The plan offers the option of annuity card which ensures convenience in receiving the annuity amount.
  • Tax benefits can be availed as per the prevailing tax law.
  • Offers the option to choose from 2 different payouts.

5. HDFC Life New Immediate Annuity Plan

This is a traditional non-linked annuity plan that offers various annuity options and provides an opportunity to live a financially secure life after retirement. The following are the features and benefits offered by the policy.

Features of HDFC  Life New Immediate Annuity Plan

  • The minimum entry age of the policy is 30 years, whereas the maximum entry age of the policy is 85 years.
  • The annuity payouts can be made on yearly, half-yearly, quarterly, or monthly mode.
  • The policy term continues until the annuitant is alive.

Benefits offered by HDFC Life New Immediate Annuity Plan

  • The plan offers the option to receive an annuity as long as the partner is alive.
  • The plan offers the benefit of higher annuity rates for the large purchase price.
  • The plan offers a wide range of annuity options to choose from.
  • Under single-life annuity, 7 different annuity options are offered to choose, whereas, in joint-life annuity 4 different annuity options are offered to choose from.

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6. ICICI Pru Immediate Annuity Plan

ICICI Pru Immediate Annuity Plan is specifically designed to provide financial security to the individual after retirement. The plan offers guaranteed lifelong income. Let’s take a look at the features and benefits of the policy.

Features of ICICI Pru Immediate Annuity plan

  • The plan can be purchased online in a simple and hassle-free way.
  • The plan offers coverage against critical illnesses.
  • The minimum annuity offered by the policy per annum is Rs. 12,000 whereas there is no upper limit on the maximum annuity.

Benefits Offered by ICICI Pru Immediate Annuity Plan

  • The plan offers 12 different annuity options to choose from.
  • The plan offers the flexibility to receive an annuity in yearly, half-yearly, quarterly, and monthly mode.
  • The entire amount of purchase price is returned to the beneficiary of the scheme in case of death, permanent disability due to accident or critical illness of the annuitant.
  • The policy offers annuity income from as early as age 30.
  • Higher annuity rates are offered for the higher purchase price.

7. IndiaFirst Life Guaranteed Annuity Plan

This is a non-linked non- participating immediate annuity plan, which provides guaranteed regular income to the policyholder throughout the life. The plan is specifically designed to cater to the financial requirements of the individual after retirement. Let’s take a look at the features and benefits of the policy.

Features of IndiaFirst Life Guaranteed Annuity Plan

  • The minimum entry age of the policy is 40 years whereas, the maximum entry age of the policy is 80 years.
  • The minimum purchase price of the policy is Rs.1,00,000 whereas, there is no upper limit on the maximum purchase price of the policy.
  • The plan offers the flexibility to receive an annuity in yearly, half-yearly, quarterly, and monthly mode.

Benefits Offered by IndiaFirst Life Guaranteed Annuity Plan

  • The plan ensures guaranteed regular income to the annuitant for a lifetime.
  • The policyholder has the choice to choose from 12 different annuity options as per their choice.
  • The plan offers coverage against critical illnesses.
  • Higher annuity rates are offered for the higher purchase price.

8. PNB Metlife Immediate Annuity Plan

PNB Metlife Immediate Annuity Plan offers financial security to the policyholder through regular income so that they can live a comfortable life post-retirement. Let’s take a look at the features and benefits offered by the policy.

Features of PNB Metlife Immediate Annuity Plan

  • The minimum entry age of the policy for singe life options is 30 years and for joint life is 40 years, whereas, the maximum entry age of the policy for both the option is 75 years.
  • The plan secures lifetime income for spouse even in the absence of the policyholder.
  • The plan offers the flexibility to receive an annuity in yearly, half-yearly, quarterly, and monthly mode.

Benefits offered PNB Metlife Immediate Annuity Plan

  • The plan offers the option to create your own annuity plan.
  • The insured can choose from a wide range of annuity options.
  • The plan provides protection to the family through a joint-life annuity option.

9. Reliance Life Immediate Annuity Plan

This is a non-linked non-participating immediate annuity plan that helps to earn a regular income after retirement.  The plan is specifically designed to provide financial security to the individual post-retirement.  The following are the features and benefits of the policy.

Features of Reliance Life Immediate Annuity Plan

  • The entry age of the policy ranges from a minimum of 20 years to a maximum of 80 years.
  • The minimum purchase price of the policy is Rs.1,00,000, whereas there is no upper limit on the maximum purchase price of the policy.
  • The plan offers the flexibility to receive an annuity in yearly, half-yearly, quarterly, and monthly mode.

Benefits Offered by Reliance Life Immediate Annuity Plan

  • The policyholder needs to pay the premium only once as a lump-sum amount.
  • The plan offers guaranteed whole life income as an annuity.
  • As per one’s own choice the policyholder can choose from 3 different annuity options.
  • Tax benefits can be availed as per the prevailing tax law.
  • No medical test is required to purchase the policy.

Read Also: Future Value of Annuity

10. SBI Life Annuity Plus Plan

This is a traditional non-linked annuity plan that offers various annuity options and provides an opportunity to live a financially secure life after retirement. The following are the features and benefits offered by the policy.

Features of SBI Life Annuity Plus Plan

  • The entry age of the policy ranges from a minimum of 40 years to a maximum of 80 years.
  • The plan offers the flexibility to receive an annuity in yearly, half-yearly, quarterly, and monthly mode.
  • The plan offers the choice of adding a family member

Benefits Offered by SBI Life Annuity Plan  

  • The plan offers guaranteed whole life income as an annuity.
  • As per one’s own choice the policyholder can choose from a wide range of annuity options.
  • Tax benefits can be availed as per the prevailing tax law.
  • No medical test is required to purchase the policy.
  • The plan offers financial freedom to enjoy retirement.

11. Star Union Dai-ichi Immediate Annuity Plan

This is a non-participating single premium plan, which ensures regular income after retirement. The plan offers the flexibility to choose from 9 different payout options to receive the annuity. The following are the features and benefits offered by the policy.

Features of Star Union Dai-ichi Immediate Annuity Plan

  • The plan offers guaranteed regular income after retirement.
  • The policyholder can choose from 9 different payout options to receive the annuity.
  • The annuities are paid in different modes i.e. yearly, half-yearly, quarterly, and monthly from the date of purchase.
  • No medical test is required to purchase the plan.

Benefits Offered by Star Union Dai-ichi Immediate Annuity Plan

  • The plan ensures financial security to the individuals after retirement.
  • Tax benefits can be availed U/S 80C and 10(10D) of the Income Tax Act.
  • The annuity payouts are made immediately after the payment of the lump-sum amount.

12. TATA AIA Life Smart Annuity Plan

This is a traditional non-participating plan, which offers financial security after retirement in the form of regular income. Under this plan, the annuitant can start getting the premium immediately after paying the premium. The following are the features and benefits offered by the policy.

Features of TATA AIA Life Smart Annuity Plan

  • The plan offers the option of top-up to enhance the annuity payouts.
  • The plan offers the option of a single or joint-life annuity.
  • The entry age of the policy ranges from a minimum of 45 years to a maximum of 85 years.

Benefits Offered by TATA AIA Life Smart Annuity Plan

  • The plan offers the flexibility to receive an annuity in yearly, half-yearly, quarterly, and monthly mode.
  • The entire amount of purchase price is returned to the beneficiary of the scheme in case of death of the insured.
  • The plan ensures financial security to the individuals after retirement.

Disclaimer: Policybazaar does not rate, endorse or recommend any specific insurance provider or insurance product offered by any insurer.

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