LIC Jeevan Shanti

LIC Jeevan Shanti Plan- An Overview

LIC Jeevan Shanti 850 is a pension plan offered by the Life Insurance Corporation of India (LIC). It is a single premium annuity plan that provides financial security and a regular source of income for policyholders post their retirement. The plan offers immediate and deferred annuity options, allowing individuals to choose when they want their annuity payments to start. With attractive annuity rates and flexibility in choosing the annuity mode, LIC Jeevan Shanti offers a reliable and convenient way to secure a stable income stream for retirees and help them lead a comfortable post-retirement life.

LIC Jeevan Shanti was withdrawn by the company, however, if you still wish to secure your post-retirement needs, you can buy LIC New Jeevan Shanti, which is the new version of the withdrawn plan.

LIC Jeevan Shanti Plan's Annuity Options

LIC Jeevan Shanti policy offers immediate and deferred annuity options. Within its immediate annuity option, the policyholder starts receiving a pension as soon as the purchase price is paid. On the other hand, a deferred annuity plan starts paying the pension amount after a certain period, known as the deferment period.

The following are the options available within the immediate annuity plan:

• Option A: An immediate annuity for life.

• Option B: An immediate annuity for a guaranteed period* of 5 years and then for life

• Option C: An immediate annuity for a guaranteed period of 10 years and then for life

• Option D: An immediate annuity for a guaranteed period of 15 years and then for life

• Option E: An immediate annuity for a guaranteed period of 20 years and then for life

• Option F: An immediate annuity for life and purchase price returned on death

• Option G: An immediate annuity increasing at 3% per annum for life

• Option H: Joint life immediate annuity for a lifetime plus 50% of the annuity paid to the secondary annuitant on the demise of the primary annuitant

• Option I: Joint life immediate annuity for a lifetime where 100% of the annuity is paid as long as one annuitant is alive

• Option J: A joint life immediate annuity for a lifetime where 100% of the annuity is paid as long as one annuitant is alive plus return of purchase price upon the demise of the last survivor.

* Note - During the guaranteed period, annuities are payable even if death occurs within the specified time period.

The following are the options available within the deferred annuity plan:

• Option1: Deferred annuity for single life

• Option 2: Deferred annuity for joint life

LIC Jeevan Shanti Plan Benefits

Listed below are the benefits of the LIC Jeevan Shanti 850 plan under the following options:

1. Immediate Annuity Plan

   The following is the list of benefits that are payable within Immediate Annuity options:

   • Option A: Within this, the annuitant will enjoy a pension for life. These are credited yearly, bi-annually, quarterly, or monthly. If the insured passes away, the pension will continue only for the guaranteed period and shall cease afterwards.

   • Options B, C, D, and E: Until the annuitant is alive, the pension payments will be made as per the mode opted for. If the annuitant passes away within the guaranteed period, the nominee will receive the annuity until the guarantee period ends. However, if the annuitant passes away after the guaranteed period, annuity payments will cease.

   • Option F: Until the annuitant is alive, the annuity payments will be made through the opted mode of payment. If the annuitant is no more, the annuity payment will cease. The nominee will be paid the purchase price for the same.

   • Option G: As long as the annuitant is alive, the payment will be made per the chosen payment mode, increasing at 3% annually. When the annuitant dies, annuity payments will cease with immediate effect.

   • Option H: Until the primary annuitant is alive, the annuity payments will be duly made as per the chosen mode of payment. In case the primary annuitant passes away, then 50% of the annuity amount will be paid to the secondary survivor till she/he is alive. Now if the secondary annuitant passes away as well, all annuity payments will cease.

   If the secondary annuitant dies before the primary annuitant, all annuity payments will continue as is until the primary annuitant passes away.

   • Option I: Until the primary and the secondary annuitant is alive, 100% of the annuity amount will be paid. When the last survivor passes away, the annuity payments will cease.

   • Option J: Until the primary and the secondary annuitant is alive, then 100% of the annuity amount will be paid. On the demise of the last survivor, the purchase price will be returned to the nominees, and the annuity payments will cease.

2. Deferred Annuity Plan

   • Option 1: If the annuitant survives the deferment period, annuity payments will start and continue for life. If the annuitant passes away during this period, the death benefit is payable to the nominee as defined.

   On the demise of the annuitant after the deferment period, annuity payments shall cease, and the death benefit will be paid to the nominees.

   • Option 2: If the death of both annuitants occurs during the deferment period, nominees can claim the death benefit. After the deferment period, annuity payments will start and continue for as long as the primary and secondary annuitants are alive. On the demise of the last survivor, all annuities will cease, and the defined death benefit will be paid to the nominee.

   • Death Benefit (Applicable only for Deferred Annuity)
     It will be higher of:

     • The purchase price plus accrued guaranteed additions, minus the total annuity paid till the date of death, or

     • 110% of the purchase price

   • Accrued Guaranteed Additions (Applicable only for Deferred Annuity)

     • The guaranteed additions will be accrued towards the end of every month until the end of the deferment period. One will obtain guaranteed addition each month wherein the value of the guaranteed addition is the purchase price * the annuity rate per annum monthly payable.

What is the Standard Eligibility for the LIC Jeevan Shanti- 850 Plan?

The minimum purchase price has to be Rs 1,50,000, which is subject to the minimum annuity, and the maximum purchase price has no limit.

Note: In the case of an NPS and if the LIC Jeevan Shanti Plan is bought for the interest of Divyangjan, as per the terms and conditions of the policy, then a lower purchase price might be permitted.

The below table shows the different modes of payment along with the minimum annuity amount:

Joint-life annuity can be taken with a lineal family member, like a parent, siblings, spouse, grandparent, or children. The two annuitants would be referred to as primary and secondary annuitants.

Why Should You Buy the LIC Jeevan Shanti Plan?

Let us quickly understand the importance of buying the LIC Jeevan Shanti plan.

• Ease of Buying: Individuals can buy the LIC Jeevan Shanti plan online or offline. Online purchase, however, makes it easier to keep track of the status, payments, etc.

• Multiple Annuity Options: The LIC Jeevan Shanti policy offers both immediate and deferred annuity options, wherein the insured can select from the wide range of options available within the policy.

• Assured Returns: These returns are added to the LIC Jeevan Shanti Plan every month and can be received easily after the deferred period.

• Guaranteed Income: The policyholder will receive a guaranteed monthly income for their entire lifetime. There are several options available wherein the nominee/secondary annuitant can receive the guaranteed income even at the early demise of the primary annuitant.

• Tax Benefits: Tax is applicable per the tax laws and tax rate set by the government. Tax paid will not be considered during the calculation of benefits received under the plan.

What are the Additional Benefits of LIC Jeevan Shanti Policy?

Listed below are some key additional benefits of LIC Jeevan Shanti Policy:

• The Flexibility of Annuity Frequency: The annuity can be received, as per convenience, on a monthly, quarterly, half-yearly, or yearly basis.

• Loan Facility: The policyholder can apply for a loan after the completion of the first year of the policy term. The loan facility is available only under the immediate annuity plan for Options F and J. In the case of deferred annuity plans, it is accessible under both single and joint life options.

• Death Benefit: The nominee will receive a death benefit under specific Options F and J of the immediate annuity plan. In a deferred annuity plan, death benefits will be available for single and joint plans.

• Unique Cover: The policy is curated keeping the handicapped (divyangjan) in mind and there are special provisions for such cases.

• Surrender Value: The LIC Jeevan Shanti policy can be surrendered within three months of its purchase. Under the immediate annuity plan, the surrender value is available for Options F and J. In the case of a deferred annuity plan, the surrender value is available for both options.

• Free Look Period: A free look period of 15 days is available for policies purchased offline, whereas, for online purchases, it is 30 days. Within this period, the policyholder can cancel the policy if not satisfied with the applicable terms and conditions of the policy.

Read More: Best 5 LIC Policies To Invest in 2020

How To Calculate LIC Jeevan Shanti Plan Premium?

To calculate the premium for the LIC Jeevan Shanti Plan using the LIC Jeevan Shanti Calculator, follow these steps: 

• Visit the LIC official website.

• Select the "Jeevan Shanti Calculator" option.

• Enter your age, premium amount, and other relevant details.

• The calculator will provide you with an estimate of the annuity payouts and other policy details based on your inputs.

• Use this information to make an informed decision about purchasing the LIC Jeevan Shanti plan.

**Note: Since LIC Jeevan Shanti has withdrawn, however, the company has launched the LIC New Jeevan Shanti plan, and to calculate the premiums for the same, you can use the LIC New Jeevan Shanti Calculator.

How to Buy LIC New Jeevan Shanti Plan?

Any individual who wishes to buy the LIC New Jeevan Shanti Plan can do so simply by visiting the company's website.

• You can buy the LIC New Jeevan Shanti Plan online by visiting the official website.

• Fill in the required details like user ID and password.

• Select the plan and then proceed to pay the premium amount.

• To check the premium and maturity value of your LIC New Jeevan Shanti Plan, you can use the LIC Jeevan Shanti Calculator.

• Once the payment is received, the LIC New Jeevan Shanti Policy Details will be shared on the registered email ID.

What are the Documents Required to Buy LIC New Jeevan Shanti Plan?

Anyone who wishes to buy the LIC New Jeevan Shanti plan needs to possess the following documents:

• Address Evidence: Driving license, passport, Aadhar card, and so on.

• Identity Evidence: Aadhar card, PAN Card, valid passport, and so on.

What are the Exclusions Within LIC Jeevan Shanti Plan?

Listed below are the exclusions that are not covered under a LIC Jeevan Shanti policy:

In case the annuitant of a single plan or the primary and secondary annuitants of a joint plan commits suicide within the first 12 months of the commencement of the policy, then:

• Immediate Annuity Plan (Applicable For Options F and J): The amount higher of the 100% of the purchase price or the surrender value would be returned. After this, no claims can be made.

• Deferred Annuity: The higher of 80% of the purchase price or the surrender value would be returned. After this, no claims can be made.