The Pradhan Mantri Vaya Vandana Yojana is a social security scheme designed to give a monthly, quarterly, half-yearly, or annual pension. Introduced by the government of India, it is run by the Life Insurance Corporation of India (LIC). The scheme offers an interest of 7.4 per cent per year.
Eligibility And Restrictions
While the minimum entry age is 60 years (completed), there is no maximum entry age. The policy term is of 10 years. The minimum pension is Rs 1,000 per month, Rs 3,000 per quarter, Rs 6,000 per half year, and Rs 12,000 per year. On the other hand, the maximum pension is Rs 5,000 per month, Rs 15,000 per quarter, Rs 30,000 per half year, and Rs 60,000 per year.
Now, let us look at the benefits:
Pension payment: On the 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.
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 and the final pension installment shall be payable.
The maximum amount of pension available to a family (pensioner, spouse, and their dependents) as a whole under all policies shall not exceed the maximum pension limit.
Payment of purchase price: The scheme can be purchased by paying a lump sum purchase price. The pensioner can either choose the amount of pension or the purchase price. The minimum purchase price for a monthly pension is Rs 1.5 lakh, while the maximum purchase price is 7.5 lakh. For other modes of payment, the minimum and maximum share prices vary slightly.
Surrender value: Premature exit is permitted under exceptional circumstances like the pensioner requiring money to treat any critical/ terminal illness of self or spouse. The surrender value payable shall be 98 per cent of the purchase price.
Loan: Loan is available against the policy after completion of three years. The maximum loan available is 75 per cent of the purchase price. The interest charged on a loan is determined at periodic intervals, and the loan interest is recovered from the pension amount payable under the policy.
