PENSION PLUS plan table No. 803 with guaranteed return

LIC New pension plus with minimum guarantee unit linked deferred pension plan

LIC has launched new PENSION PLUS plan table No. 803 with guaranteed return of 4.5%. On the occasion of its 54th anniversary, the Life Insurance Corporation of India on Friday launched a new scheme – LIC pension plus.The plan is without risk cover

This is basically a ULIP plan that gives you guarantee of minimum return. This plan is ideal for those who do not want to take risk but still want the investment benefits.

Minimum premium is Rs.15000 per year or 30,000 one time.

Min. Term 10 yrs

Min. age to start pension is 40 years.

The allocated premium will be utilized to purchase units as per the selected fund type. The Policyholder’s Fund Value will be subject to deduction of charges. Units will be allotted and cancelled based on the Net Asset Value (NAV) of the respective fund applicable to the date of allotment / cancellation. There is no Bid-Offer spread (both the Bid price and Offer price of units will be equal to the NAV). The NAV will be computed on daily basis and will be based on the investment performance, Fund Management Charges (FMC) and whether fund is expanding or contracting under each fund type.

There are 2 funds available depending upon investment pattern are as follows

1) Debt Fund: – It is a low risk fund with no investment in equity shares.

2) Mixed Fund: – It is a low to medium risk fund with investment in equity shares is between 15% to 35%.

Features of PENSION PLUS plan table No. 803 :

1) Guaranteed Maturity Proceeds: - If all due premiums are paid till maturity, a guaranteed interest shall accrue on the gross premium, including Top-up premium if any, at the end of each financial year. The guaranteed interest rate shall be 50 basis points above the average of the reverse repo rate prevailing as on the last working day of June, September, December and March of the preceding year. However, the guaranteed interest rate shall be Subject to a maximum of 6% and a minimum of 3%. This guaranteed interest rate is not applicable to a Discontinued policy.

2) The minimum guaranteed rate of 4.5% p.a. is applicable to all premiums received up to 31st March, 2011,

including any Top-up premiums paid.

3) Benefit on Vesting: - BID Value of units held in the policyholder’s unit account would be invested in Immediate Annuity. Investment can be either with LIC or with any other Insurance Company.

4) Death Benefit: - BID Value of Units as at the date settlement / Booking liability whichever is earlier is given to Nominee.

5) Conversion to annuity: The benefit amount, payable in case of surrender or on discontinuance of premium or on vesting, shall compulsorily be utilized to provide an annuity. However proposer can commute 1/3rd of the Maturity Proceeds.

6) TOP-UP facility is available.

7) Switching:- Switching to any Fund type is allowed. Within a given policy year 2 Switches will be free of charge i.e. after every policy Anniversary first 2 Switches are free. Switches more than 2 allowed subject to deduction of Rs.100/- per switch from the 3rd Switchover.