Government of India in the Union Budget 2014-2015, announced the revival of Varishtha Pension Bima Yojana. Excerpts from budget speech by Honrable Finance Minister are, "NDA Government during its last term in office had introduced the Varishtha Pension Bima Yojana (VPBY) as a pension scheme for senior citizens. Under the scheme a total number of 3.16 lakh annuitants are being benefited and corpus amounts to Rs.6,095 Crore. I propose to revive the scheme for a limited period from 15th August 2014 to 14th August 2015 for the benefit of citizens aged 60 years and above“

1. Varishtha Pension Bima Yojana
Plan No. 828
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SUMEET PAWAR
( INSURANCE ADVISOR)
CONTAC TS: -
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2. Features
 Government of India in the Union Budget 2014-2015,
announced the revival of Varishtha Pension Bima Yojana.
Excerpts from budget speech by Honrable Finance Minister
are, "NDA Government during its last term in office
had introduced the Varishtha Pension Bima
Yojana (VPBY) as a pension scheme for senior
citizens. Under the scheme a total number of 3.16
lakh annuitants are being benefited and corpus
amounts to Rs.6,095 Crore. I propose to revive the
scheme for a limited period from 15th August 2014
to 14th August 2015 for the benefit of citizens aged
60 years and above“
 LIC of India has been given the sole privilege to operate
this scheme.

3. Benefit
 Death Benefit: (deal with sudden financial crisis)
On death of the Pensioner the Purchase Price shall be
refunded.

4. Benefit
 Vesting Benefit: (Pension)
During the lifetime of Pensioner, a pension in the form of immediate
annuity as per mode chosen by the Pensioner shall be payable.

5. Benefit Illustration
Details Value
Age 60 years
Term Immediate Pension Plan
Premium Paying Term Single
Sum Assured Rs 6,66,665
Premium Paid (incl. ST) for Single Prem. Rs 6,87,265 (Rs 6,66,665 + Rs 20,600)
Pension for Month Rs 5,000
On Death Rs 6,66,665

6. Eligibility Conditions & Other Restrictions
Details Value
Minimum Entry Age 60 years (completed)
Maximum Entry Age No Limit
Minimum Pension
Rs 500 per month
Rs 1,500 per quarter
Rs 3,000 per half year
Rs 6,000 per year
Maximum Pension
Rs 5,000 per month
Rs 15,000 per quarter
Rs 30,000 per half yearly
Rs 60,000 per year
Premium Payment Mode Single

7. Payment of Purchase Price
 The plan can be purchased by payment of a lump
sum Purchase Price. The pensioner has an option to
choose either the amount of pension or the Purchase
Price.
 The minimum and maximum Purchase Price under
different modes of pension will be as under:
Mode of Pension Minimum Purchase Price Maximum Purchase Price
Yearly Rs. 63,960/- Rs. 6,39,610/-
Half-yearly Rs. 65,430/- Rs. 6,54,275/-
Quarterly Rs. 66,170/- Rs. 6,61,690/-
Monthly Rs. 66,665/- Rs. 6,66,665/-

8. Mode of Pension Payment
 The modes of pension payment are monthly,
quarterly, half-yearly & yearly. The pension payment
shall be through ECS/NEFT only.
 The first installment of pension shall be paid after 1
year, 6 months, 3 months or 1 month from the date
of purchase of the same depending on the mode of
pension payment i.e. yearly, half-yearly, quarterly or
monthly respectively.

9. Sample Premium Rates per Rs 1,000
Purchase Price
The pension rates for Rs.1000/- Purchase Price for different modes of pension
payments are as below
Pension Mode Pension Rates
Yearly Rs. 93.8069 p.a.
Half-yearly Rs. 91.7045 p.a.
Quarterly Rs. 90.6767 p.a.
Monthly Rs. 90.0000 p.a.

10. Surrender Value
The policy can be surrendered aftercompletion of 15
years. The Surrender Value payable will be refund of
Purchase Price. However, under exceptional
circumstances, if the pensioner requires money for
the treatment of any critical/terminal illness of self
or spouse then the policy can be surrendered before
the completion of 15 years and the Surrender Value
payable shall be 98% of Purchase Price.

11. Loan
 Loan facility is available after completion of 3 policy
years. The maximum loan that can be granted shall be
75% of the Purchase Price.
 The rate of interest to be charged for loan amount would
be determined from time to time by the Corporation.
 Loan interest will be recovered from pension amount
payable under the policy. The Loan interest will accrue as
per the frequency of pension payment under the policy
and it will be due on the due date of pension. However,
the loan outstanding shall be recovered from the claim
proceeds at the time of exit.

12. Free-Look Period
 If a policyholder is not satisfied with the "Terms and
Conditions of the policy, he/she may return the
policy to the Corporation within 15 days from the
date of receipt of the policy stating the reason of
objections.
 The amount to be refunded within free look period
shall be the Purchase Price deposited by the
policyholder after deducting the charges for Stamp
duty.

13. Claims Settlement Report of all Life
Insurance Companies in India (IRDA Annual Report 2012-13)

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