LIC's Saral Pension (Plan 862) Calculator

1. Introduction:

Standard Immediate Annuity plan as per IRDAI guidelines. Offers fixed terms across insurers. Provides annuity (pension) immediately after paying a lump sum (single premium). Rates are guaranteed for life.

2. Annuity Options:

• Option I: Life Annuity with Return of 100% Purchase Price (ROP). Pension paid for annuitant's life. On death, 100% PP returned to nominee.
• Option II: Joint Life Last Survivor Annuity with ROP. Pension paid as long as either the annuitant or spouse is alive. On the death of the *last* survivor, 100% PP returned to nominee. (Joint life only with spouse).
• Option chosen cannot be altered later.

3. Benefits:

• Regular annuity payments (pension) start immediately, paid in arrears (at end of chosen period).
• Lifelong income guaranteed for the annuitant (Option I) or annuitant/spouse (Option II).
• Return of 100% Purchase Price to nominee upon death (of annuitant in Opt I, or last survivor in Opt II).

4. Eligibility:

• Min/Max Entry Age (Annuitant & Spouse): 40 years to 80 years (completed).
• Purchase Price: Single premium payment. Min amount depends on age/option to meet min annuity. Max: No Limit.
• Minimum Annuity Payouts: ₹1,000/month, ₹3,000/quarter, ₹6,000/half-year, ₹12,000/year.

5. Annuity Payment Mode:

Yearly, Half-Yearly, Quarterly, or Monthly. Paid at the end of the chosen interval.

6. Incentives:

• Higher annuity rates for higher purchase prices (Slabs: ₹5L+, ₹10L+, ₹25L+).
• 2% increase in annuity rate if purchased directly Online.
• Slightly higher rates for more frequent payout modes (Monthly > Quarterly > Half-Yearly > Yearly).

7. Illustration (Example):

Shows sample annuity amounts for specific age/purchase price (used as basis for this calculator's estimates).

8. Surrender Value:

Policy can be surrendered *only* if annuitant/spouse/child is diagnosed with a specified Critical Illness (listed in policy annexure). Allowed after 6 months. Surrender value is 95% of Purchase Price (less any loan/interest).

9. Loan Facility:

Available after 6 months. Max loan amount limited (interest payable cannot exceed 50% of annual annuity). Interest recovered from annuity payments. Outstanding loan deducted from claim proceeds. Rate linked to G-Sec (9.24% p.a. for May'24-Apr'25).

10. Taxes:

GST applicable on purchase price. Annuity received is generally taxable income (consult tax advisor).

11. Free Look Period:

30 days from policy receipt to review terms. Can return policy if unsatisfied (premium refunded after deductions).

12. Grievance Redressal:

Standard process via LIC channels, IRDAI, or Insurance Ombudsman.

13. Section 45 (Insurance Act):

Policy cannot be questioned after 3 years, except for fraud.

14. Prohibition of Rebates (Section 41):

Offering/accepting rebates on premium/commission is illegal.