LIC Jeevan Shanti Pension Plan: What is it?

LIC Jeevan Shanti Plan
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Life Insurance Corporation of India is among the oldest life insurance company. The company came into existence in 1956. LIC offers various types of plans. It has a variety of life insurance plans to choose from, each designed differently for different kinds of people with different needs.

This article will talk about one of its plans known as the LIC Jeevan Shanti Plan. The article will cover the LIC’s new Jeevan Shanti plan’s types, benefits, and eligibility criteria, and will also tell you why you should invest in it.

Summary in Brief

  • What is Jeevan Shanti Plan?
  • Types of Jeevan Shanti LIC Plan
  • Benefits of the new Jeevan Shanti Plan
  • The eligibility criteria for the plan
  • How to buy the plan?

What is Jeevan Shanti Plan?

The LIC new Jeevan Shanti Plan is a pension plan offered by the Life Insurance Corporation of India. It is designed to secure one’s future after retirement. It is a non-participating, non-linked, single premium annuity plan. It offers a dual benefit of returns for you to choose an immediate or deferred annuity. Each of these types has its own set of features and benefits.

In this plan, you have to pay the entire premium in a lump sum amount. You can opt for an immediate annuity plan in which you can avail of the returns after paying all the premiums, while for the deferred annuity plan, you can avail of returns after a period of time. The minimum deferred period of the policy is one year and the maximum is 20 years.

Types of Jeevan Shanti LIC Plan

The plan can broadly be categorized into Immediate Annuity plan and Deferred Annuity Plan, as mentioned above. The following are further categorizations of the plan available to the people to invest their money in:

Immediate Annuity Plan:

  • Option A: In this type, one can avail of immediate returns for a lifetime. You have various modes of payouts such as monthly, quarterly, bi-annual, and annual. In case of the death of the policyholder, the payment will stop.
  • Option B: This option offers a guaranteed payment for 5 years and life thereafter. If the policyholder dies, the beneficiary mentioned in the policy will receive the assured amount.
  • Option C: Similar to option B, but with a longer period. In this option, you will receive a guaranteed payment for 10 years and life thereafter. Again, in case the policyholder dies during these 10 years, then the beneficiary will receive the assured amount.
  • Option D: Similar to the above two options with an extended period. In this option, you will receive a guaranteed payment for 15 years and life thereafter. If case the policyholder dies during these 15 years, then the beneficiary will receive the assured amount.
  • Option E: Similar to the above three options with another extended period. In this option, you will receive a guaranteed payment for 20  years and life thereafter. If case the policyholder dies during these 20 years, then the beneficiary will receive the assured amount.
  • Option F: In this option, the sum assured will be provided to the beneficiary upon the policyholder’s death. The beneficiary/nominee will receive the entire purchase price amount.
  • Option G: This option is for life and comes with a 3% simple rate per year.

Joint Annuity Plans (Immediate):

  • Option H: This is owned by two people jointly. On the demise of one of the policyholders, the other policyholder receives 50% of the annuity amount till their survival.
  • Option I: It is similar to the above option, but in case of the demise of one policyholder, the other receives 100% of the annuity amount.
  • Option J: Under this option, when one policyholder dies, the other receives 100% of the annuity amount along with a return of purchase price on death when the second policyholder dies.

Deferred Annuity Plan:

  • Option A: During the Deferment Period of a single holder, if he survives the period, he shall not receive anything. But, if he dies, the beneficiary will receive the death benefit.
  • Option B: After the Deferment Period of a single holder, the annuity payment is paid till the annuitant is alive. When he dies, the annuity payments stop immediately and the death benefit will be paid to the beneficiary/nominee.
  • Option C: During the Deferment Period of a joint policy, if both policyholders survive, then nothing shall be payable. Whereas, if both of them die, then the death benefit will be payable.
  • Option D: After the Deferment Period of a joint policy, the annuity payment is paid as long as both holders are alive. When the last policyholder dies, the annuity payment will stop and the death benefit will be paid.

Benefits of the new Jeevan Shanti Plan

The following are the benefits of the LIC pension plan Jeevan Shanti:

  • It assures a lifetime income just by a one-time investment.
  • Guaranteed additions during the deferment period.
  • Offers a variety of options to choose from, based on your needs and goals.
  • The rates are defined from the beginning of the plan.
  • Option to choose immediate annuity and deferred annuity plans.
  • Policyholders have the option to avail the facility of loans after completing one policy year.
  • You have the option to return the policy within 15 days for free if you are not satisfied with the terms and conditions.
  • You have the option to surrender the plan anytime after 3 months of completing the policy.
  • You have the option to open a joint account with your family members.
  • The nominee receives the death benefit after the death of the policyholder.
  • A unique cover is offered when the dependent life is handicapped. 
  • Can claim tax exemption under section 80C of the Income Tax Act.

The eligibility criteria for the plan

  • Minimum purchase price: Rs.1,50,000
  • Maximum purchase price: No limit on the same.
  • Minimum Age: 30 years is the minimum age of entry for both Immediate and Deferred Annuity plans.
  • Maximum Age: 85 years/100 years(for option F) is the maximum age for entering an Immediate Annuity plan. Whereas for the Deferred Annuity plan, the same is 79 years.
  • The minimum Deferment Period for Deferred Annuity is 1 year and is not applicable for an immediate annuity plan.
  • The maximum Deferment Period for Deferred Annuity is 20 years(Subject to maximum vestige age) and is not applicable for an immediate annuity plan.
  • Minimum vestige age: 31 years for deferred annuity and not applicable for immediate annuity plans.
  • Maximum vestige age: 80 years for deferred annuity and not applicable for immediate annuity plans.

Key Takeaways

  • Jeevan Shanti Plan is a pension plan specifically designed for retirement purposes.
  • You have the option to choose from the Immediate Annuity Plan and Deferred Annuity Plan.
  • The minimum purchase price is Rs.1,50,00 and there is no upper limit; which is the be paid in a lump sum amount in one go.
  • You claim tax exemption under section 80C of the Income Tax Act.

How to buy the plan?

You have the option to visit the nearby LIC branch to buy the plan or you can simply buy it by visiting the company’s website. With advancements in technology, everything is available at our fingertips, and so is this plan. You can visit the LIC website, register yourself with a valid user ID and password and select the Jeevan Shanti online plan of your choice and make the payment of the premium.

Once the payment is made, all the details will be shared on your registered email id.

Conclusion

The Life Insurance Corporation of India is amongst the oldest and most popular insurance companies in India. It has a huge customer base and a variety of plans. LIC comes up with new types of policies from time to time to cater to every individual’s needs. One needs to make sure that his goals and purpose for investing are clear and can compare various policies and choose the right one that fits his needs.

LIC Jeevan Shanti plan comes with various options and is a great option to consider while buying a pension plan to secure your future post-retirement.

  • What documents are required to buy the policy?

  • Which is the best option for me?

  • Is this plan eligible for tax exemptions?

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