Ruchi SrivastavaLife Insurance Corporation (LIC) has launched its newest pension scheme, the LIC Smart Pension Plan 2025. LIC has introduced its latest offering, the ‘LIC’s Smart Pension,’ a Non-Participating, Non-Linked, Individual/Group Savings Immediate Annuity Plan. Tailored for the domestic market, this plan will be available for purchase starting February 18, 2025.
In this Blog, we will see how this new scheme will provide financial security and stability to retirees, ensuring a steady income post-retirement.
What is the LIC Pension Plan?
LIC pension plans are insurance schemes that ensure policyholders’ regular income after retirement. These plans allow individuals to build a financial reserve during their working years, which is later utilized to provide a stable income post-retirement. LIC offers a range of pension plans tailored to different financial goals, risk appetites, and personal preferences.
Key Features of LIC Smart Pension Plan 2025
- Assured Pension – Provides a steady and reliable income throughout retirement.
- Flexible Payment Options – Choose between single or regular premium payments based on financial preference.
- Diverse Annuity Choices – Multiple annuity options to suit individual needs.
- Lifetime Coverage – Offers lifelong pension benefits, with provisions for the spouse after the policyholder’s passing.
- Loan Availability – Policyholders can access loans against their policy for urgent financial requirements.
- Tax Advantages – Contributions may be eligible for tax benefits as per applicable regulations.
Types of LIC Pension Plans
1. LIC Jeevan Akshay – VII – This LIC pension plan offers immediate annuity benefits, allowing policyholders to select from 10 different annuity options. The annuity rate is fixed at the time of policy purchase and ensures lifelong payouts to the annuitant.
2. LIC New Jeevan Shanti – This is a one-time premium payment policy where the policyholder starts receiving annuity payments after the deferment period. The annuity rates are fixed at the time of purchase and continue for the annuitant’s lifetime.
3. LIC Pension Plus Plan – This LIC pension product, formerly known as LIC Pension Plus 803, is a unit-linked insurance plan that enables investors to grow their savings by investing in market-linked funds. At the end of the policy term, the accumulated amount can be used to purchase either an immediate or deferred annuity plan. This approach helps build a larger savings corpus while ensuring financial security for pensioners and their families.
4. LIC Saral Pension Plan – This LIC Pension Scheme requires a one-time premium payment, after which annuity payments commence. The annuity rates under LIC’s Saral Pension scheme are fixed at the time of purchase and continue for the annuitant’s lifetime.
5. LIC Jeevan Dhara II—LIC Jeevan Dhara II is a deferred annuity plan by LIC of India designed to provide financial security after retirement. It offers features like enhanced annuity through Top-up options and flexible death benefit payouts for comprehensive coverage. The Liquidity Option allows lump sum withdrawals, while the Advanced Annuity Option supports joint-life annuity arrangements.
Challenges faced by LIC to strengthen its Market Position
- Expanding Leadership – As India’s pension and retirement savings market grows, LIC aims to strengthen its leadership by addressing rising demand for financial security.
- Product Expansion – The company continues to diversify its offerings to meet the evolving needs of consumers.
- Financial Challenges – In Q3, LIC reported a 9% decline in net premium income, with a 24% drop in single-premium collection and a 14% fall in first-year premiums.
- Profit Growth – Despite the decline in premiums, LIC recorded a 17% rise in profit after tax, reaching ₹11,056 crore, supported by cost reductions in employee compensation and welfare expenses.
- Market Competition – In January, LIC saw a 14% YoY decline in premiums, reflecting intense competition in the sector.
- Stock Performance – LIC’s shares closed at ₹765.40, gaining nearly 1% on the BSE today.
How will LIC Smart Pension Plan Boost Retirement Savings?
1. Launch Date – LIC will introduce its new pension product, ‘LIC’s Smart Pension,’ on February 18, 2025.
2. Plan Type – A Non-Participating (Non-Par), Non-Linked, Individual/Group, Savings, Immediate Annuity Plan tailored for the domestic market.
3. Market Impact – Expected to reinforce LIC’s position in India’s growing pension and retirement savings sector.
4. Rising Demand – Aims to cater to the increasing need for financial security in retirement.
Comparison between HDFC Life Smart Pension Plan and LIC Jeevan Akshay – VII
Among the many available options, HDFC Smart Pension Plan and LIC’s Jeevan Akshay-VII have gained popularity due to their unique features. These plans offer various benefits and facilities to help individuals build their desired financial corpus. Below is a detailed overview of these two plans.
| Feature | HDFC Life Smart Pension Plan | LIC’s Jeevan Akshay-VII |
| Plan Category | Unit-Linked Deferred Annuity Plan | Non-Linked Immediate Annuity Plan |
| Payment Mode | Single, Regular, or Limited Premium | One-time Lump Sum Payment |
| Eligibility Age | 18 to 70 years | 30 to 85 years |
| Annuity Commencement | After the accumulation phase | Starts immediately upon purchase |
| Investment Mechanism | Invests in market-linked funds | Provides fixed annuity payouts |
| Annuity Choices | Based on an accumulated corpus | 10 different annuity options |
| Loan Option | Available under certain terms | Not available |
| Nominee Benefit | Pays fund value to the nominee | Depends on the chosen annuity option |
| Market Influence | Returns vary with market fluctuations | No market risk, fixed returns |
| Ideal For | Individuals looking to grow retirement savings | Those seeking immediate and guaranteed annuity |
How does the LIC Pension Plan Calculator work?
The LIC pension plan calculator helps estimate your potential pension amount based on the details you provide. It is accessible to anyone eligible for a pension plan. By entering the required information, users can determine the total corpus they can accumulate by retirement. The calculator provides insights into the invested amount, interest earned over the policy tenure, and the total funds generated through the plan.
Final Thoughts
The LIC Smart Pension Plan 2025 is a thoughtfully designed retirement scheme aimed at providing financial security in later years. Whether you’re preparing for retirement in advance or seeking a dependable pension investment, this plan offers a blend of stability, flexibility, and lifelong benefits. Set to launch on February 18, 2025, it presents a valuable opportunity for individuals looking to safeguard their financial future. For further information, visit the official LIC website or reach out to your nearest LIC branch today!
Source – LIC rolls out ‘Smart Pension’ plan; sales begin tomorrow
FAQs
Q1. Should we all Have an LIC Pension Plan?
Ans. An LIC pension plan offers financial stability and assured income after retirement. However, its relevance depends on your current investments, risk tolerance, and future financial objectives.
Q2. How LIC Smart pension plan is better than other LIC pension Plans?
Ans. The LIC Smart Pension Plan excels with its diverse annuity choices, flexible features, and instant annuity benefits. It provides greater customization and assured lifelong financial stability compared to other LIC pension plans.
Q3. Which is better PPF or the LIC pension plan?
Ans. PPF is a great option for those looking for a safe, long-term investment with tax advantages, making it ideal for retirement planning due to its low risk and tax-free returns. In contrast, LIC policies are better suited for individuals who want life insurance protection combined with savings or investment benefits.
Q4. What is an Immediate Annuity Plan?
An immediate annuity plan is a pension scheme that begins providing regular income right after purchase. By making a one-time lump sum payment, you can start receiving payouts as early as the next month, based on your selected payout frequency.
