Varishtha Pension Bima Yojana - 828
Government of India in the Union Budget 2014-2015, announced the revival of Varishtha Pension Bima Yojana. Excerpts from budget speech by Honrable Finance Minister are, NDA Government during its last term in office had introduced the Varishtha Pension Bima Yojana (VPBY) as a pension scheme for senior citizens. Under the scheme a total number of 3.16 lakh annuitants are being benefited and corpus amounts to Rs.6,095 Crore. I propose to revive the scheme for a limited period from 15th August 2014 to 14th August 2015 for the benefit of citizens aged 60 years and above
LIC of India has been given the sole privilege to operate this scheme.
Benefits
Pension Benefit:
During the lifetime of Pensioner, a pension in the form of immediate annuity as per mode chosen by the Pensioner shall be payable.
Death Benefit:
On death of the Pensioner the Purchase Price shall be refunded.
Eligibility Conditions and Other Restrictions:
| Particulars | Description |
|---|---|
| Minimum Entry Age | 60 years (completed) |
| Maximum Entry Age | No limit |
| Premium mode | Single premium only. |
| Minimum purchase price | Rs. 63,960 |
| Maximum purchase price | Rs. 6,66,665 |
| Minimum Pension | Rs. 500 per month |
| Maximum Pension | Rs. 5000 per month |
| Mode of pension payment | Monthly, Quarterly, Half-yearly & Yearly (the pension payment shall be through ECS/NEFT only) |
Ceiling of maximum pension is for a family as a whole i.e. total amount of pension under all the policies issued to a family under this plan shall not exceed the maximum pension limit. The family for this purpose will comprise of pensioner, his/her spouse and dependants.
Sample Pension rates per Rs.1000/- Purchase Price
The pension rates for Rs.1000/- Purchase Price for different modes of pension payments are as below:
Yearly: Rs. 93.8069 p.a.
Half-yearly: Rs. 91.7045 p.a.
Quarterly: Rs. 90.6767 p.a.
Monthly: Rs. 90.0000 p.a.
The pension instalment shall be rounded off to the nearest rupee. These rates are not age specific.
Surrender Value
The policy can be surrendered after completion of 15 years. The Surrender Value payable will be refund of Purchase Price. However, under exceptional circumstances, if the pensioner requires money for the treatment of any critical/terminal illness of self or spouse then the policy can be surrendered before the completion of 15 years and the Surrender Value payable shall be 98% of Purchase Price.
Loan
Loan facility is available after completion of 3 policy years. The maximum loan that can be granted shall be 75% of the Purchase Price. The rate of interest to be charged for loan amount would be determined from time to time by the Corporation. Loan interest will be recovered from pension amount payable under the policy. The Loan interest will accrue as per the frequency of pension payment under the policy and it will be due on the due date of pension. However, the loan outstanding shall be recovered from the claim proceeds at the time of exit.
Taxes
Taxes including Service Tax, if any, shall be as per the Tax laws and the rate of tax as applicable from time to time. The amount of tax payable as per the prevailing rates shall be payable by the policyholder on Purchase Price. The amount of Tax paid shall not be considered for the calculation of benefits payable under the plan.
Free Look period
If a policyholder is not satisfied with the Terms and Conditions of the policy, he/she may return the policy to the Corporation within 15 days from the date of receipt of the policy stating the reason of objections. The amount to be refunded within free look period shall be the Purchase Price deposited by the policyholder after deducting the charges for Stamp duty.
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