Insurance-Cum-Pension Plan for Senior Citizens

Insurance cum pension scheme for senior citizens has been relaunched by the Finance minister Arun Jaitley. The revived scheme is likely to come in action from August 15, 2014 to August 14, 2015, where the citizens of 60 years and above would receive monthly pension ranging between Rs 500 and Rs 5000.

Finance ministry expressed his concern towards the senior citizens and informed how the scheme will provide financial security during their advancing years by ensuring regular income. He informed LIC will be in charge of the administration process where the Varishtha Pension Bima Yojana (VPBY) would target on benefiting the vulnerable section of the society with limited resource and monthly pension ranging from Rs 500 to Rs. 5000 to the senior citizens of the nation. Introduced in 2003-04 by NDA government, VPBY covered 3.83 lakh senior citizens. And, Rs 7100 crore was collected by LIC under the same.

Jaitely believes LIC would cover larger number of people. The pension will be applicable on insurance scheme purchased from next year. The minimum and maximum investment for the scheme is Rs. 66,665 and over Rs. 6.6 lakh respectively. If the insured dies, the purchase price will be refunded to the nominee.

Relaunch of this scheme is a justification to the fact that the government is committed towards the well-being and welfare of the senior citizens in the scenario of longevity in India which has increased substantially.

A corpus of more than Rs 10,000 crore is expected with the subscription of this scheme. This source would lead to resource mobilization for the progress of the country.

Arun Jaitely informed that the beneficiary receives the annual income at the rate of 9.38 % on their deposits when they are paid on monthly basis under the Varishtha Pension Bima Yojana. He added that this scheme would help the senior citizens to receive a fixed return for rest of their life even in this era of unpredictable interest rate.