Pradhan Mantri Vaya Vandana Yojana

Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a Pension Scheme announced by the Government of India exclusively for the senior citizens aged 60 years and above which was available from 4th May, 2017 to 31st March, 2020. The scheme is now extended up to 31st March, 2023 for a further period of three years beyond 31st March, 2020.

Benefits of the Scheme

Following are the major Benifits
  • Scheme provides initially an assured rate of return of 7.40 % per annum for the year 2020-21 per annum and thereafter to be reset every year.
  • Pension is payable at the end of each period, during the policy term of 10 years, as per the frequency of monthly/ quarterly/ half-yearly/ yearly as chosen by the pensioner at the time of purchase.
  • The scheme is exempted from GST.
  • On survival of the pensioner to the end of the policy term of 10 years, Purchase price along with final pension installment shall be payable.
  • Loan upto 75% of Purchase Price shall be allowed after 3 policy years (to meet the liquidity needs). Loan interest shall be recovered from the pension installments and loan to be recovered from claim proceeds.
  • The scheme also allows for premature exit for the treatment of any critical/ terminal illness of self or spouse. On such premature exit, 98% of the Purchase Price shall be refunded.
  • On death of the pensioner during the policy term of 10 years, the Purchase Price shall be paid to the beneficiary.

Eligibility Condition and other restrictions

  • Minimum Entry age : 60 years (Completed)
  • Maximum Entry Age: No limit
  • Policy Term : 10 years
  • Investment limit : Rs 15 lakh per senior citizen
  • Options available for Pension Amount : Rs. 1,000/- per month
  • Rs. 3,000/- per quarter, Rs.6,000/- per half-year, Rs.12,000/- per year
Ceiling of maximum pension is for a family as a whole i.e. total amount of pension under all the policies allowed 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 dependents.

Mode of Pension Payment

The modes of pension payment are monthly, quarterly, half-yearly & yearly. The pension payment shall be through NEFT or Aadhaar Enabled Payment System.












Surrender value

The scheme allows premature exit 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 in such cases shall be 98% of Purchase Price.

Free lock period

If a policyholder is not satisfied with the “Terms and Conditions” of the policy, he/she may return the policy to LIC within 15 days (30 days if this policy is purchased online) 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 and pension paid, if any.

Comments

  1. Short but informative blog

    ReplyDelete
  2. Informative, easy to understand, good going. 👍

    ReplyDelete
  3. Does it mean that pensioner need to pay for 3 year then s/he will get pension for 10 year?

    ReplyDelete
    Replies
    1. No!
      It's a one time investment plan.
      One should invest once and get pension for 10 years

      Delete

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