PMVVY – Pradhan Mantri Vaya Vandana Yojana is a government pension Scheme for people aged 60 years and above. Life Insurance Corporation of India is the administrator of PMVVY on behalf of the Government of India.
This Scheme is available for sale up to 31st March 2023
Features of the scheme
Eligibility Age
Citizens of India aged 60 years (completed) and above can purchase this Scheme and there is no upper age limit for purchasing this Scheme.
Term
The term of this Scheme is 10 years.
Pension Mode
The mode of pension payment can be monthly/quarterly/half-yearly or yearly. The first installment of pension shall be paid after 1 year, 6 months, 3 months, or 1 month from the date of purchase of the same depending on the chosen mode of pension payment i.e. yearly, half-yearly, quarterly, or monthly respectively.
Pension Rate
The scheme provides an assured pension of 7.40% p.a. payable monthly (i.e equivalent to 7.66% p.a.) for Financial Year 2022-23. This assured rate of pension shall be payable for the full policy term of 10 years for all the policies purchased till 31st March 2023.
Maximum purchase limit
The total amount of purchase price under all the policies under this Scheme, and all the policies taken under earlier versions of Pradhan Mantri Vaya Vandana Yojana allowed to a senior citizen shall not exceed Rs. 15 lakhs.
Surrender Condition
A policy taken under this policy can be surrendered anytime during the term of the policy during the policy term under exceptional circumstances like the Pensioner requiring money for the treatment of any critical/terminal illness of self or spouse. The Surrender Value payable under this Scheme shall be 98% of the Purchase Price.
Loan Availability
A loan facility is available after the completion of 3 policy years. The maximum loan that can be granted shall be 75% of the Purchase Price. Loan interest will be recovered from the 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 the pension. However, the loan outstanding shall be recovered from the claim proceeds at the time of exit.
Benefits available under the scheme
Pension payment
On survival of the Pensioner during the policy term of 10 years, pension in arrears (at the end of each period as per the mode chosen) shall be payable. For example, if you choose the monthly mode of annuity, the first pension payment will be made after one month from the date of purchase of the policy.
Death Benefit
On the death of the Pensioner during the policy term of 10 years, the Purchase Price shall be refunded to the beneficiary.
Maturity Benefit
On survival of the pensioner to the end of the policy term of 10 years, the Purchase price along with the final pension installment shall be payable.
