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Varishtha Pension Bima Yojana Pension Scheme for Senior Citizens

In the Union Budget of 2014-15, the Government of India has announced Varishtha Pension Bima Yojana’s revival. There are various pension plans in India that are formulated to benefit the future of the people after retirement. There are several pension schemes for senior citizens as well that are meant solely for them to take advantage of the schemes in future.

The Varishtha Pension Bima Yojana scheme is a single pension policy meant for the senior citizens that allows the pension start to flow immediately. There is an option to receive it either annually, half yearly, quarterly or monthly. LIC of India has got a special privilege for operating this scheme. Based on the manner a person chooses to get the pension, there are certain ceilings on the minimum and maximum investment amount.

In case when more than two or 2 members in a family wants to invest in this scheme jointly, then they can do that. But together, the total amount of their investment cannot go beyond the limits that are specified. The amount of invested (also known as purchase price) will be given back to them on the expiry of the holder of the policy or at the time of surrender of this policy. Pension plans in India vary from the type of scheme chosen.

Surrender under this policy is only allowed after a period of 15 years. Under exceptional cases like treatment of a family member or self, early surrender is permitted and the holder of the policy will receive 98% of the amount invested. There is a facility of loan as well under this plan. After a period of 3 years, the policy holder can lend or borrow an amount up to 75% of the amount invested. The interest will get adjusted according to the amount of pension paid.

The benefit of Varishtha Pension Bima Yojana is that during the pensioner’s lifetime, pension will be payable in the manner of immediate annuity according to the mode that is chosen by the pensioner. On pensioner’s death, the invested amount will be refunded back. The eligibility criterion of age for this scheme is minimum 60 years of age. The minimum amount of pension received is Rs. 500 every month to maximum of Rs. 60000 per year. The maximum amount of pension received for the entire family means that the total pension amount under this scheme issued to the family shall not go beyond the limit of pension mentioned. This plan can be taken by paying a lump sum investment amount.

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