Create a life-long guaranteed, tax-free* income

Guarantee of regular income for lifetime

We are talking about a life-long guaranteed tax-free income. Think of a time 15 years, 20 years, 25 years, or 30 years from now when you will retire and stop earning an active income but still on the 1st of every month a guaranteed sum of money gets deposited to your bank account that is tax-free* and would continue up to 99 years of your life. How relaxing does this situation feel?

And that is not all, at the same when you are earning a guaranteed, tax-free* amount you are also creating an estate for your family that keeps growing year after year which is handed over to your family after you. Most importantly you can choose the amount of guaranteed pension you need every year and create it accordingly.

Think of it as a fixed deposit that you have created and from which you are earning a guaranteed, tax-free* regular income of your choice and at the same time the deposit is growing every year till your age of 99 years. Amazing, right? 

And additionally, we have the freedom to create the deposit through monthly, quarterly, half-yearly, or yearly contributions for a period of time, and the income is fixed accordingly. You have to choose the duration of contributions keeping in mind your income needs both in terms of amount and time to retire as well as your capacity to contribute at present.

Example of contribution & income

We take an example of a yearly contribution of 10 lakhs made by a person of 30 years of age for different contribution periods.

Yearly ContributionYears ContributedGuaranteed lifelong payout. (post contribution)Additional Estate created# (shown at age 100)
10 Lakhs1510 Lakhs15 Crores
10 Lakhs2015 Lakhs21 Crores
10 Lakhs2520 Lakhs28 Crores
10 Lakhs3025 Lakhs36 Crores

# Values are approximate and expected as per present calculations of bonuses.

What is this plan?

This plan is a reality and is a whole life plan offered by Life Insurance Corporation of India and comes with a sovereign guarantee (LIC policyholders enjoy a sovereign guarantee on the sum assured and the bonus declared as per section 37 of LIC Act, 1956 which clearly states that ” Policies to be guaranteed by Central Government- The sum assured by all policies issued by the corporation including any bonuses declared in respect thereof and, subject to the provisions contained in section 14 the amounts assured by all policies issued by any insurer the liabilities under which have vested in the corporation under this act, and all bonuses declared in respect thereof, whether before or after the appointed day, shall be guaranteed as to payment in cash by the Central Government.”).

No plan is comparable to this one, which gives guaranteed, lifetime, tax-free* payouts along with the creation of a growing family fund.

Benefits for the holder

  • Lifetime guaranteed income every year post the premium term @ 8% of Sum Assured
  • Increasing life cover to address growing insurance needs with age.
  • Assured capital protection (Sovereign Guarantee)
  • Liquidity through pre-sanctioned loan facility.
  • Accidental Insurance cover double the basic life cover.
  • Disability Benefit equal to the Accident Benefit Sum Assured shall be paid. The amount is divided into equal monthly instalments spread over a period of 10 years. Also, payment of future premiums are also waived.

* Unlike a pension, this yearly payout is tax-free if total premium paid is below 5 lakhs in a year. Total premium is calculated across all insurance products of all insurers.

Can NRIs avail benefits of this plan?

NRIs are also allowed to contribute and reap the benefits of this plan and create life-long guaranteed tax-free income. (with restriction on sum assured depending on the country of residence). They can apply for these benefits when they visit India. Else, they can invest through the regulation called “Mail Order Business” from their current residential country. They would, however, have to complete certain formalities.

For further information and personalized calculations Contact us

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life-long guaranteed tax-free income

Read: LIC’s special premium plan for high net-worth individuals

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