LIC New Jeevan Shanti (Pension Plan No 858) – Features, Benefits and Negative Factors
LIC New Jeevan Shanti No 858 Review
LIC has launched New Jeevan Shanti No 858 which is deferred annuity plan. This is like enhancement to old LIC Jeevan Shanti Pension plan with a few changes. The annuity rates are guaranteed at the inception of the policy. LIC is a trusted brand and many would opt insurance and pension products as these are lifetime commitments. Earlier LIC launched Jeevan Akshay 7 which was immediate pension plan whereas LIC’s New Jeevan Shanti is deferred annuity plan. What is deferred annuity and how does it work? What are the features of this LIC New Jeevan Shanti Plan No 858? In this article we would do LIC New Jeevan Shanti review which is launched now in October, 2020.
How does deferred annuity work?
Since LIC New Jeevan Shanti pension plan provides immediate annuity, one would get doubt as to how does this work exactly.
1) One needs to purchase this pension plan in a lump sum.
2) LIC would pay the pension amount based on the option chosen.
3) The pension would not start immediatelty. It would start after a specific period indicated in the pension policy which is called deferred period.
4) Pension amount would depend on the terms of the pension plan.
If you want to know more about Annuity Pension Plans, you can watch this video (5 mts watch). Credit: Myinsuranceclub.com
Features of LIC’s New Jeevan Shanti Plan
This new Jeevan Shanti pension plan is launched by LIC few days back.
This pension plan is a non-linked, non-participating, single premium, deferred annuity plan.
This is a single lump sum paid pension plan where one can get an deferred annuity / pension income.
The minimum purchase price is Rs 1.5 Lakh.
There is no maximum purchase price limit.
Minimum age of entry is 30 years.
Maximum age of entry is 79 years.
The annuity is payable either monthly, quarterly, half yearly or yearly.
The annuity rates are guaranteed at the inception of the policy.
It provides two annuity options (single life or joint life). One can choose based on their requirement.
Minimum deferment period is 1 year and maximum is 12 years. Means you can consider this plan now and get pension after 12 years onwards.
You can purchase this pension plan either offline or online.
Free look-in period of 15 days for offline purchase and 30 days for online purchase.
One can get loan between 50% to 80% of the annuity amount.
One can buy multiple pension plans.
This LIC’s new jeevan pension policy no 858 has unique code of UIN – 512N338V01.
What are annuity options available in LIC New Jeevan Shanti?
LIC New Jeevan Shanti offers two annuity options.
Option-1 – Deferred annuity for Single life
Option-2 – Deferred annuity for Joint life
What is minimum annuity under this scheme?
Here are the minimum annuity under this scheme.
1) Annuity Monthly – Rs 1,000 per month
2) Annuity Quarterly – Rs 3,000 per quarter
3) Annuity Half yearly – Rs 6,000 every 6 months
4) Annuity Yearly – Rs 12,000 per annum.
What are LIC New Jeevan Shanti Pension pension plan benefits?
Here are the benefits of this pension plan from LIC.
1) Benefit payable on survival: Here are the survival benefits payable
Option-1 – Deferred annuity for Single life:
- During deferment period: Nothing is payable during the deferment period.
- After deferment period: Annuity payments will be made in arrears as long as the Annuitant is alive, as per the chosen mode of annuity payment.
Option-2 – Deferred annuity for Joint life
- During deferment period: On the survival of the Primary Annuitant and/or Secondary Annuitant during the deferment period, nothing is payable.
- After deferment period: annuity payments will be made in arrears as long as the Primary Annuitant and/or Secondary Annuitant is alive, as per the chosen mode of annuity payment.
2) Maturity benefit – There is no maturity benefit payable.
3) Death benefit – Death Benefit shall be higher of:
- “Purchase Price” plus accrued “Additional Benefit on Death” minus Total annuity amount payable till date of death
- 105% of Purchase Price.
4) Accrued Guaranteed Additions:
- Under Deferred Annuity, Guaranteed Additions shall accrue at the end of each policy month, till the end of Deferment Period only.
- In case of death of the annuitant during the deferment period, Guaranteed Additions for the policy year in which the death has occurred shall accrue till the completed policy month as on the date of death.
What is the LIC New Jeevan Shanti Surrender Value?
The policy can be surrendered at any time during the policy term.The Surrender Value payable shall be higher of Guaranteed Surrender Value or Special Surrender Value.
- If the chosen annuity option is other than specified above, surrender of policy shall not be allowed. On the payment of the surrender value, the policy shall terminate and all other benefits shall cease.
- The surrender value payable shall depend on the age (last birthday) of the Annuitant at the time of surrender/date of vesting of the policy.
What is LIC New Jeevan Shanti calculator chart?
The annuity pension calculator would help you to know how much pension you can get based on the annuity purchased + respective option chosen by you. LIC has been yet to publish a chart / link for LIC new Jeevan Shanti calculator. We would update this section once we get complete info.
How is this annuity pension is taxed?
Any pension received is taxable as per the income tax slab applicable to them.
Are there any incentiaves / rebates in this pension plan?
Here are the incentives / rebates applicable on this plan.
1) If you buy this pension scheme online, you would get a 2% higher annuity instead of discount. E.g. if you buy annuity for Rs 10 Lakhs online, you would get annuity for Rs 10,20,000. If you buy this pension plan offline, you would not get any rebate. The reason is there is LIC agent in between where the commission would go to them.
2) If you purchase higher annuity amount plan of above Rs 5 Lakhs, one would get incentive ranging between 1.5% to 2.7%. This would get added to annuity amount itself as enhanced value.
Why should you buy LIC New Jeevan Shanti?
Here are a few reasons to buy this pension scheme.
1) It comes with deferred annuity option. If you are reaching your retirement age in the next 1 to 12 years timeframe, you can consider this pension scheme where the pension amount would start only after the deferment period.
2) New Jeevan Shanti is from LIC which is trusted brand. One can get life long pension once the deferment period is over.
3) Though there is minimum annuity purchase value of Rs 1.5 Lakhs, there is no maximum limit. One can invest any amount as they wish to get pension amount
4) No Medical examination required to take this LIC Jeevan Shanti plan.
Are there any negative factors in this pension plan?
Here are some negative factors / disadvantages of this plan.
1) Pension plans in general come with low returns. LIC Pension plans come with low returns of 5% to 6%.
2) There are better retirement plans than New Jeevan Shanti plan like PMVVY, SCSS, PPF etc.
4) One can get pension amount up to 79 years of age. If the annuitant survives beyond this, they would not get pension amount.
5) The annuity rates are guaranteed at the inception of the policy. Assume you are at 50 years of age and plan for this policy where you would know the guaranteed pension amount. However when you reach to retirement age, the value of such pension income would reduce due to inflation.
6) If you are opting for high value annuity purchase and going with LIC Branch / LIC agent, you would get low rebate. Instead one can go for online option where you can get 2% rebate / discount.
How to buy this pension plan?
You can purchase this LIC pension plan either online or offline.
Offline purchase – Pls visit LIC branch or consult an LIC agent.
Online purchase – You can visit LIC New Jeevan Shanti Online link here to purchase and select this plan.
Where to contact if we have queries on this pension plan?
You can write to LIC at firstname.lastname@example.org or call toll free number 1800227717 or landline numbers 022-26117044, 022-26127303-05,022-67819282,022-67819284.
Should you invest in LIC’s New Jeevan Shanti?
Any new product by LIC would attract investors for various reasons.
LIC insurance or pension products provide 5% to 6% returns. If you are planning for retirement during 1 to 12 years, you might get tempted to consider this plan as it offers deferred annuity after this period. One should first consider better retirement plans such as Pradhan Mantri Vaya Vandhana Yojana, Sr Citizens Saving Scheme, RBI Tax Saving Bonds 2020 and some of the high interest rates bank fixed deposits for Senior Citizens. If you are a low risk investor and have exhausted all these options you can consider this LIC New Jeevan Shanti. If you are in young age or mid age, you don’t need such plans as you have not planned for your retirement in the near future of say 10-12 years.
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