LIC Jeevan Shanti Plan – Review, Key Features & Benefits

Table of Contents

LIC Jeevan Shanti Policy 

The latest Pension plan from LIC of India. The pension can be option either immediately or deferred (1-20 years).

In case of death of the policy holder the family gets the full deposited amount.

Jeevan Shanti Plan

This is a single premium plan wherein the Policyholder has an option to choose an Immediate or Deferred annuity. The annuity rates are guaranteed at the inception of the policy for both Immediate and Deferred Annuity and annuities are payable throughout the life time of Annuitant(s).
This plan can be purchased offline as well as online. To purchase the plan online, please log on to our website www.licindia.in

Annuity Options in LIC Jeevan Shanti Policy

You first have to opt for any of the following 2 options:

Immediate Annuity – In this option, your payments will start immediately. You purchase the plan by making a single payment and depending on the payout chosen, the payouts will start. In case you have chosen monthly payouts, your annuity payouts will start after the first month. In case you choose annual payouts, you will start receiving your first annuity after a year.

The immediate annuity options are as follows:

Option A: Immediate Annuity for life.
Option B: Immediate Annuity with guaranteed period of 5 years and life thereafter.
Option C: Imm

ediate Annuity with guaranteed period of 10 years and life thereafter.
Option D: Immediate Annuity with guaranteed period of 15 years and life thereafter.
Option E: Immediate Annuity with guaranteed period of 20 years and life thereafter.
Option F: Immediate Annuity for life with Return of Purchase Price.
Option G: Immediate Annuity for life increasing at a simple rate of 3% p.a.
Option H: Joint Life Immediate Annuity for life with a provision for 50% of the annuity to the Secondary Annuitant on death of the Primary Annuitant.
Option I: Joint Life Immediate Annuity for life with a provision for 100% of the annuity payable as long as one of the Annuitant survives.
Option J: Joint Life Immediate Annuity for life with a provision for 100% of the annuity payable as long as one of the Annuitant survives and return of Purchase Price on death of last survivor.

Deferred Annuity – In this option, you purchase the plan by making a single payment and choose to start receiving the payouts only after a certain number of years. This option is useful for those who have some extra money when young and want to lock-in some retirement income when they turn older. For the period of deferment, you will receive guaranteed additions which are again fixed when you buy the plan.

The options for Annuity under this are as follows:
Option 1: Deferred annuity for Single life
Option 2: Deferred annuity for Joint life

Benefits of the plan

• Make one time investment and get Guaranteed life long income.
• 9 different annuity options to choose from to suit every need and circumstance.
• Option to choose either Immediate Annuity or postpone it to a future date as Deferred Annuity.
• Annuity rates are guaranteed from inception of the policy.
• Guaranteed additions during deferment period.
• This policy can be taken on own life or as joint life with grandparent, parent, children, grandchildren, spouse or siblings.
• Loan Available: Loan facility shall be available after completion of 1 policy year.
• Surrender Allowed: The policy can be surrendered at anytime after three months from the completion of policy when Annuity Option is with return of purchase price.
• Free look Period: If the Policyholder is not satisfied with the “Terms and Conditions” of the policy, the policy may be returned to the Corporation within 15days.
• Option to take the plan for the benefit of handicapped dependant (Divyangjan) lifeOther Policy Benefits of Jeevan Shanti policy

Loan on Policy

Yes, loan is available on the Jeevan Shanti policy

Revival of policy

Since this is a one premium plan there is no revival option in Jeevan Shanti.

Surrender policy

Yes, the policy can be surrendered after 3 years of policy. The surrender value of the policy is different for different policies and it mainly depends on how far the maturity date is.

Features of Jeevan Shanti Policy

• Life-Long Income by way of pension.
• A choice of Immediate or Deferred Annuity to cater to the needs of every customer
• Easy to Purchase: Online as well as offline
• Multiple Annuity Options available to the customers to choose from
• Guaranteed Additions in Deferred Annuity
• Divyangjan Plan where the plan can be purchased for the benefit of a handicapped dependant
• Joint Life Annuity Plan with spouse, grandparent, sibling or parent.
• Tax Benefits 
  • Premium
    The premium paid towards purchasing an annuity is tax free U/S 80CCC till INR 1.5 lakhs per annum.
  • Annuity
    – For Immediate Annuity, there is no withdrawal benefit. However, the annuity is taxable in the hands of the annuitant.
    – For Deferred Annuity, 1/3rd the entire annuity corpus can be withdrawn tax-free U/S 10(10)A and the remaining 2/3rd has to be converted to annuity according to the option chosen. Annuity is taxable in the hands of the annuitant.
• Accrued Guaranteed Additions
  Deferred Annuity: Under this option, the Guaranteed Additions are added every month till the policy is vested, i.e. the Deferment Period ends.
  The Guaranteed Additions = (The Purchase Price * Rate of Annuity rate p.a. payable monthly) / 12 

  The rate of annuity= Monthly tabular Rate of Annuity, which depends on :

  • Entry Age of the annuitant
  • The period of Deferment opted for

  The Guaranteed Additions do not accrue further if the annuitant dies before the policy is vested.

• Availability of Loan
  After completion of 1 policy year, the policyholder has the option to apply for a loan facility one the following options.
  – Immediate Annuity 
  • Option F: Immediate Annuity for life with return of Purchase Price
  • Option J: Joint Immediate Annuity for life with the provision for 100% of the annuity payable as long as any of the annuitant is alive and return of Purchase Price on the death of the last survivor.

  – Deferred Annuity

  • Option 1: Deferred Annuity for Single Life
  • Option 2: Deferred Annuity for Joint Life

  Thus, Loan is available only under Option F and J for Immediate annuity and both options 1 and 2 in deferred annuity.

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