Launched on 21 October 2020 LIC New Jeevan Shantiis a lifelong pension plan by India’s most trusted insurance company, LIC. This being a single premium plan, the policyholder can get an income for life by making a one-time lump sum payment.
It is a non-linked and non-participating annuity plan which offers various multiple advantages to the person to be insured for life. LIC New Jeevan Shantiis available in two deferred annuity plans. For both the options in this plan, the insured is guaranteed annuities at the time of policy purchase. The annuity is paid after the deferment period till the time any of the annuitants is alive.
- Deferred Annuity Plan Option 1
Available for single life.
- Deferred Annuity Plan Option 2
Available for joint life.
Policyholders can choose any of the plans as per their financial requirements.
Eligibility criteria of LIC New Jeevan Shanti plan
LIC New Jeevan Shanti has prescribed minimum age and several other eligibility criteria for those seeking to register under this plan.
|Entry Age||Minimum age 30 yearsMaximum age 79 years|
|Vesting Age||Minimum age 31 yearsMaximum age 81 years|
|Purchase Price||INR 1,50,000No Maximum Limit|
|Deferment Period||Minimum: 1 yearMaximum: 12 years (subject to the maximum vesting age)|
Note: For a dependant person with some disability, the minimum purchase price offered is INR 50,000/-
Benefits of the LIC New Jeevan Shanti plan
- Death Benefit
OptionPeriodSurvival of the AnnuitantDeath of the AnnuitantUnder Option 1During the Deferment PeriodNothing is payableAnnuity stops immediately + Death Benefit is paid to the nominee and the policy terminatesUnder Option 1After the Deferment PeriodAnnuity payment continues as per the chosen annuity option as long as the primary annuitant is aliveAnnuity stops immediately + Death Benefit is paid to the nominee and the policy terminatesUnder Option 2During the Deferment PeriodNothing is payableAfter the death of both the annuitants, the annuity stops immediately + Death Benefit is paid to the nominee and the policy terminatesUnder Option 2After the Deferment PeriodAnnuity payment continues as per the chosen annuity option as long as either/both the annuitants are aliveAfter the death of both the annuitants, the annuity stops immediately + Death Benefit is paid to the nominee and the policy terminatesUnder both the options- Deferred Annuity for Single Life and Deferred Annuity for Joint Life, the death benefit is the higher of:
- 105% of the Purchase Price OR
- (Purchase Price + Accrued Additional Benefit on death) – Total Annuity amount payable till the date of death
The death benefit can be received in the form of a lump sum amount
On the death of the insured, the benefit would be utilized to buy an Immediate Annuity for the nominees, depending on the age of the nominee.
- Death Benefit in Installments
Instead of a lump sum, the death benefit can also be paid out in installments spread over 5 or 10 or 15 years.
Features of LIC New Jeevan Shanti plan
- Flexible annuity optionsThe plan offers a lot of flexibility when it comes to choosing the annuity. There are a lot of different options that can be opted for when choosing a plan for yourself.
- Incentives Available
- There is an incentive by way of increase in the annuity rate available when a high purchase price is opted for
- A 2% rebate by way of increase in annuity rate is available when the policy is purchased online or as QROPS (Qualifying Recognized Overseas Pension Scheme)
- Ease of Purchase
The plan can be purchased online via the company website or Turtlemint. You can also buy the LIC Jeevan Shanti Pension Plan offline by visiting a company office or getting in through an insurance agent.
Before you finalise buying the policy, it is recommended that you visit www.turtlemint.com to compare the best plans and then purchase the best one.
- Ease of loan facility
A policy buyer can avail of the benefit of taking loans on the LIC Jeevan Shanti plan after the completion of one policy year.
- Special Divyangjan cover
In case a dependant is handicapped, a separate provision is there where the amount of investment gets reduced.
- Free Look periodThis policy has a free look period of 15 days which means that the policy buyer can cancel the purchase if he/she is not satisfied with the provided terms and conditions.
Premium details for LIC New Jeevan Shanti plan:
To understand how the LIC New Jeevan Shanti pension plan works, let us take a look at this sample illustration for Ravi Sharma, who is a 43-year-old man. Let us take a look at the policy if he buys the Joint-Life option with his wife who is 39 years old, and also if he buys it as Single Life. The policy details are as follows:
- Purchase Price: INR 20 lakhs
- Deferment Period: 10 years
Here is the annuity amount payable:
|Annuity||Annually (in INR)||Half-Yearly (in INR)||Quarterly (in INR)||Monthly (in INR)|
*These premiums are indicative only and subject to change at any point of time.
Policy details of LIC New Jeevan Shanti plan (80-100 words)
Continuing with the same example, where Ravi Sharma buys the Jeevan Shanti Plan LIC with the purchase price as INR 20 lakhs and 10 years is the deferment period.
If Ravi survives till the end of the deferment period, i.e, on vesting, he starts to receive INR 1,76,400 as his annuity on a yearly basis.
In case of Joint Life Annuity, he would receive INR 1,70,000 or INR INR 13,600 on an annual or a monthly basis respectively.
Riders in LIC New Jeevan Shanti plan
There are no riders in the LIC New Jeevan Shanti pension plan.
Documents required for LIC New Jeevan Shanti plan
- New PlanThe documents required to avail of this policy are as follows-
- As address proof the policy buyer can provide his/her passport, driving licence or Aadhar card.
- As identity proof, the policy buyer can provide his/her valid passport, Aadhar card, PAN card, etc.
- To Claim the Annuitant’s DeathThe death claim is admissible only if the death takes place within the deferment period chosen by the annuitant.A death claim has to be raised within 90 days of death. The following documents must be kept handy:
- Claim Form issued by the company, available online
- Original policy documents
- NEFT details as mandated
- Death Proof from specified authorization
- To Surrender the Policy
- Discharge Form- filled and signed
- NEFT mandate
- Bank details
Exclusions of LIC New Jeevan Shanti plan
The policy will be nullified if the survivor in the case of a joint annuity, by any reason, commits suicide at any given point in time. The time period should fall within 12 months from the date of the beginning of the risk. This case implies the payment of 80% of the premium paid or the surrender value. Any other claims are not valid in the eyes of the company.
Tax implication in LIC New Jeevan Shanti plan
Let us take a look at the various tax implications in New Jeevan Shanti Plan LIC
- Premiums PaidUnder Section 80CCC, the premiums that you pay towards this policy are tax-deductible under Income Tax Act, 1961.
- Death BenefitUnder certain options, where the death benefit is available, it is tax-free in the hands of the nominee.
- Commuted pensionAt the end of the deferment period, there is an option to withdraw 1/3rd of the corpus tax-free under section 10(10A). The remaining amount has to be converted into an annuity and it is taxable in the hands of the annuitant.
Surrender Value in LIC New Jeevan Shanti Plan
The plan can be terminated at any point during the policy. The payable surrender value would be higher than the GSV (Guaranteed Surrender Value) or special surrender value. The special surrender value is reviewable and is decided by the corporation once it is approved by the IRDAI.
If you are looking for a secure and enhanced insurance plan, the LIC New Jeevan Shanti plan can be a smart choice. One of the key pension plans, the LIC New Jeevan Shanti plan allows the policyholder to choose the Single Life or the Joint Life annuity option as per his needs. It is highly recommended that you read all the terms and conditions before you finalize buying the plan. Choose the annuity as per your preference and enjoy the plan benefits to the fullest.
Yes, you can do so under the Divyangjan option. You can purchase the Deferred Annuity for Single Life Option as the proposer, with the Divyangjan as the nominee.
There is a simple formula to calculate the Guaranteed Surrender Value, which is (Guaranteed Surrender Value Factor X Purchase Price) – Total Annuity Amount payable till the surrender date. The Guaranteed Surrender Value is:
- Policy Year: 1; GSV Factor: 75%
- Policy Year: 2; GSV Factor: 75%
- Policy Year: 3; GSV Factor: 75%
- Policy Year: 4; GSV Factor: 90%
- Policy Year: 5; GSV Factor: 90%
No, you have the option to purchase the Joint Life Option with any lineal descent/ ascendent of your family. This means you can buy the plan jointly with your child, parent, sibling, grandparent, or grandchild.