BEST PENSION PLANS

Until now it was only the LIC, which was selling a policy known as “Jeevan Suraksha-1”. But recently the private players in Life insurance have come up with pension plans. E.g. ICICI Prudential Life Insurance Company are having a pension plan known as “ICICI Pru Forever Life”, which is a deferred pension policy. Similarly the HDFC Standard Life Insurance also has a pension plan known as “Personal Pension Plan”. The corpus of Jeevan Suraksha is calculated based on the assumed annual bonus rate of Rs 65 per 1000 and assumed final bonus rate of Rs 50 per 1000. The corpus under Forever Life is based on the initiated bonus rate of 4% after the 7th year as under this plan Annual guaranteed additions at the rate 3.5% on the aggregate of Sum Assured and guaranteed addition. The corpus under Personal Pension Plan is based on the annual bonus rate of 6.5% p.a. However none of the Companies offer guaranteed yield. All Companies normally talk about indicative yield. “Forever Life” offered by ICICI Prudential Life Insurance Company also provide for insurance cover during the tenure of the pension plan. However in case of LIC, Jeevan Suraksha the Life risk can be covered by paying some extra premium by taking term rider. “Forever Life” Plan has in built Life Insurance cover and therefore the premium is higher in comparison to the other two plans. Therefore for those investors who are looking for pure pension plan should go in for pension schemes of Jeevan Suraksha 1 or Personal Pension Plan. In the event of death of the policy holder before the vesting age Forever life Plan makes payment of the sum assured plus guaranteed additions, if eligible and bonuses or the regular income stream shall accrue to the spouse while Jeevan Suraksha-1 makes payment of 5% interest calculated on premium paid on compounded basis and the Personal Pension Plan makes payment of 8% interest compounded basis on the premiums paid. The annuity options must also be seen carefully because in Joint Life last survivor annuity option of LIC & HDFC has a provision to provide 50% of annuity amount to spouse after the death of the policyholder while ICICI Prudential provide 100% of annuity amount to the spouse with.

Table Indicating Premiums ( Regular Premium Policy) Sum Assured/Notional Cash Option= 10 lacs Age= 35 years Term=20 years Vesting age=55years Name of the Company LIC ICICI-PRU HDFC-Standard Life Name of the Policy Jeevan Suraksha-1 Forever Life Personal pension Plan Annual Premium 40,498 45,158 41,920 Total Estimated Corpus 23,50,000 24,11,710 25,50,000 Estimated Monthly Pension. 13,486 13,567 14,729

Particulars ICICI Pru Life LIC HDFC Standard Life Type Forever Life Jeevan Suraksha-1 Personal Pension Plan Entry Age       Min. 18 Years 18 Years 18 Years for S.P & 35 Years for R.P. Max. 60 Years 65 Years 60 Years for R.P./S.P. Term       Min. 5 Years 2 Years 5 years for S.P. & 10 years for R.P. Max. 30 Years 35 Years 15 years for S.P. & 40 years for R.P. Vesting Age 50 Years 50 Years 50 Years Min.       Max. 70 Years 79 Years 70 Years Sum Assured/Notional Cash Value Min. Rs. 50,000 Rs 50000 for R.P./Rs.10000 for S.P Rs.25,000 for S.P./R.P Max. No Limit No Limit No Limit Premium       Min. - S.P. Rs.10,000/ R.P. Rs.2,500 S.P. Rs.25,000/ R.P. Rs.1,800 Premium Paying Options R.P. R.P. & S.P. R.P. & S.P. Riders Accident & Disability Benefit, Critical Illness Benefit, Major Surgical Assistance, Level Term Cover Term Assurance Option only with R.P. No Rider available Maturity Option to take 25% of corpus (sum assured, guaranteed additions and vested bonuses) in lumpsum & balance 75% as an annuity/ Annuity on full corpus. Option to take 25% of corpus (Notional Cash Option, additional bonus, reversionary bonuses and final if any) in lumpsum & balance 75% as an annuity/Annuity on full corpus. Option to take 25% of corpus (Notional Cash Option, bonuses and final terminal bonus, if any) in lumpsum & balance 75% as an annuity. Annuity on full corpus/Annuity on full corpus. Death (During deferment) Regular Income stream to spouse if the spouse is not alive a lumpsum amount is paid to the ominees./Spouse has option to take 100% of Sum assured+bonuses+ +guaranteed additions (if death after 7 years of the policy) All premiums (excluding term assurance premium and extra premium if any) paid up to the date of death accumulated at the rate of 5% p.a. compounded or at such rate decided by the LIC from time to time will be paid to the nominee All Premiums paid up to the date of death accumulated at the rate of 8% p.a. compounded will be paid to the nominee or (Notional Cash Option+Bonus + terminal bonus), whichever is lower Death (After deferment) Spouse/beneficiaries benefits Depends upon Annuity option chosen Spouse/beneficiaries benefits Depends upon Annuity option chosen Spouse/beneficiaries benefits Depends upon Annuity option chosen Surrender guaranteed surrender value is payable after 3 years premiums are paid guaranteed surrender value is payable after 2 years premiums are paid ( For single premium one year after the date of commencement) guaranteed surrender value is payable after 3 years premiums are paid. Loan Not Available Not Available Not Available Tax Benefits Deduction Up to Rs. 10,000 u/s Sec. 80CCC(1) Deduction Up to Rs. 10,000 u/s Sec. 80CCC(1) Deduction Up to Rs. 10,000 u/s Sec. 80CCC(1) Open Market Option Available Not Available Available Life Cover Available Not Available Not Available Postponement of vesting age Available Not Available Not Available R.P.- Regular Premium       S.P.- Single Premium       Note: Please verify the latest figures from the Insurance Company before making Investment/buying a policy. The above are based on the available market information and all efforts have been made to represent the facts in the best possible manner. We do not guarantee that the information in the article reflect latest information. One is requested to consult the policy details before buying the policy.