LIC Senior Citizen Scheme

LIC or the Life Insurance Corporation of India has been a renowned and leading insurance company in India. Since 1940, LIC has been catering to the needs of the Indian people in the fields of insurance and investment through its myriad insurance products for all age groups in India. Time and again, LIC has launched several insurance schemes and pension plans for our senior citizen population and has worked with Government of India to work with Government pension schemes.

Currently, LIC has some efficient pension plan schemes for the senior citizens that intend to provide a secure financial future for the senior citizens i.e. those above 60 years of age.

Some of the prominent LIC Senior Citizen Schemes are:

  • Pradhan Mantri Vyay Vandana Yojana (PMVVY)
  • LIC ‘s Jeevan Shanti
  • Pradhan Mantri Atal Pension Yojna (APY)

We will help you compare plans and decide the best pension scheme for you to suit your retirement income prospects.

What is LIC Senior Citizen Scheme?

LIC has a couple of pension plans and welfare schemes for senior citizens.

  • One such LIC Senior Citizen scheme is a senior citizens’ pension plan for those aged 60 years and above. This is the PMVVY or the Pradhan Mantri Vyay Vandana Yojana. Government of India has introduced this pension scheme for our senior citizens to safeguard their financial interests due to currently prevailing low-interest rates on Fixed Deposits being offered by various banks
  • Jeevan Shanti is another pension plan scheme for senior citizens offered by LIC. Here you need to pay a single one-time payment for this plan. As per the plan, LIC will regularly pay fixed amounts for the rest of life. The payouts that you will get regularly are called as an annuity. These regular amounts can be availed monthly, quarterly, half-yearly, or annually till life
  • APY or the Atal Pension Yojna is another pension scheme for citizens of India. It mainly focuses on workers from the unorganized sector. Based upon the contributions by subscribers to the APY, guaranteed minimum pension per month ranging from Rs. 1,000 to Rs 5,000 will be provided at 60 years of age

Why should you choose the LIC Senior Citizen Scheme?

LIC has launched schemes for senior citizens, under which citizens above 60 years of age can avail regular income in the form of pension by investing in such plans. Taking inspiration from Government policies and the changing financial scenario, LIC has also come up with its pension plans. You can compare plans to come up with the following benefits derived from LIC pension schemes:

  • These schemes come as a good option for the senior members of your family
  • The main objective of these Senior Citizen schemes is to provide for a financial safety net cover for senior citizens after retirement to provide them with a regular income even when they cease to be actively working
  • These LIC Senior Citizen schemes allow you to invest a lump-sum amount for a fixed period to ensure immediate or deferred payments in the future after the tenure period is over
  • The payout income provides guaranteed Income even when one has retired in the form of annuities
  • In case of the death of the policyholder, the nominee gets the money as per the chosen option
  • These are products with low liquidity that allow the insured to withdraw the pension money after the expiry of a specific term

Types of LIC Senior Citizen Scheme Plans

Here is a rundown to different types of senior citizen scheme plans is as follows:

  1. Pradhan Mantri Vyay Vandana Yojana

    One popular scheme is the PMVVY, commonly known as the Pradhan Mantri Vyay Vandana Yojana. It is a pension plan for senior citizens. Government of India launched the scheme in May 2017 by for the welfare of the senior citizen population. The scheme met with a massive response as more and more people showed trust in the pension plan. Government of India in 2018-19 Budget Speech announced the increase in the maximum limit from the former Rs 10 Lakh to Rs 15 Lakh.

    The scheme provides a guaranteed interest rate of 8 % per annum that is payable monthly. This is equal to 8.3% p.a. for 10 years. Senior citizens above 60 years can invest in these schemes to ensure a fixed monthly pension. The maximum amount one can invest in the scheme is Rs 15 Lakh for 10 years. There is no option for any renewal policy.

    The purchase price will be returned at the end of 10 years. The minimum pension that they get is Rs. 1000 while the maximum pension that they can receive is Rs. 10,000 monthly, depending upon the amount invested in the pension scheme.

    Minimum Pension:      Rs. 1,000 per month

    Rs. 3,000 per quarter 

    Rs.6,000 per half-year 

    Rs.12,000 per year

    Maximum Pension:     Rs. 10,000 per month

    Rs. 30,000 per quarter 

    Rs. 60,000 per half-year 

    Rs. 1,20,000 per year

    Note: The total amount of pension under all the policies under this plan should not exceed the maximum pension limit.

    Sample Pension Rates for Rs. 1000(in p.a.)
    Monthly Rs. 80
    Quarterly Rs. 80.50
    Semi-Annually Rs. 81.30
    Annually Rs. 83
    • The pension installment is rounded off to the nearest rupee
    • These rates are independent of the age of the insured
  2. LIC Jeevan Shanti

    This is another single premium pension plan by LIC for the welfare of senior citizens. This scheme can also be taken by a handicapped dependent of the policyholder. Here the policyholder can opt for either a deferred or immediate payment. For both Immediate and Deferred Annuity, the rates of interest are guaranteed at the policy’s inception. The annuities will be payable throughout the lifetime of the policyholder.

    The plan is available under 10 options, Options A to J:

    • Immediate Annuity
    • Annuity for life for 5/10/15/20 years
    • Immediate Annuity accompanied with Purchase Price return 
    • Immediate Annuity at an increasing p.a. rate of 3%
    • Joint life immediate annuity with a provision of 50% annuity to the nominee upon the death of insured
    • Joint life immediate annuity with a provision of 100% annuity as long as one person survives
    • Joint life immediate annuity with a provision of 100% annuity as long as one person survives with the return of purchase price upon the death of the last survivor

    Plans for Deferred annuity are also provided with 2 options –

    • For Single Life
    • For Joint Life

    Under this scheme, the pension holder can also avail of the loan facility after completion of 1 year of the policy. However, this loan is not valid for all plan options.

     It can be availed in case of Option F and Option G of Immediate Annuity Plans and both the plans for Deferred Annuity.

    In the case of Annuity Option with the return of purchase price, the policy can be surrendered any time after three months from the completion of policy.

    This policy comes with a free lookup period of 15 days as well i.e. If the Policyholder is not satisfied with the "Terms and Conditions" of the policy, he may return it within 15 days.

    There is no option of any plan renewal.

    LIC Jeevan Shanti Immediate Annuity Plan
    Purchase Price Minimum: Rs. 150,000 Maximum: No Limit
    Entry age 30-85 years
    Annuity Type Immediate under a total of 10 options
    Premium One-time single payment
    LIC Jeevan Shanti Deferred Annuity
    Purchase Price Minimum: Rs. 150,000 Maximum: No Limit
    Entry age 30-79 years
    Annuity Type Deferred with 2 options-Single Life and Joint Life
    Premium One-time single payment
    Deferment Period 1-20 years based on vesting age
  3. Pradhan Mantri Atal Pension Yojna

    This is also a senior citizen pension plan for the welfare of pensioners. The Atal Pension Yojana or the APY is started by Government of India in 2015. In this scheme, the applicants pay a cash amount to the pension account. This helps them to fund their retirement after they reach 60 years of age. The main idea is to provide assured returns.

    Enrolling for the scheme at an early age helps in saving more money for retirement. Only one APY account can be opened by an individual and that will be a unique account. It is mandatory to provide nominee details when opening an APY account. Subscribers are allowed to increase or decrease the amount of monthly contribution to their pension account; however, it can be done only once a year.

Features of LIC Senior Citizen Schemes

Salient features of LIC Senior Citizen Plans are as follows:

  • These schemes can be purchased by paying a lump-sum amount
  • The amount to be invested is referred to as ‘purchase price’
  • Senior citizens can get a monthly pension for a policy term of 10-20 years
  • There are four pension modes- Monthly/Quarterly/Six-monthly/Annually
  • The pension payment will be done at the end of each period as per the payment mode selected by the policyholder
  • NEFT or Aadhaar Enabled Payment System will be used to transfer the pension payment
  • In PMVVY, on depositing the maximum Rs 15 Lakh, one can get Rs 10,000 monthly pension for 10 years
  • If a policyholder is not satisfied with the policy terms, he/she may return the policy to the Corporation within 15 days, if purchased from any authorized LIC centre and within 30 days if this policy is purchased online, from the date of receipt of the policy. The policyholder also needs to specify the reason for returning the policy.
  • If the insured dies during the policy term of 10 years, the price of purchase will be refunded to nominees
  • Loan facility is available after completion of 3 policy years in the case of PMVVY. The maximum loan will be 75% of the Purchase Price of the plan
  • The scheme allows premature exit by the subscriber. This can happen in case of critical or terminal illness to the investor or spouse. On such a premature exit, 98% of the price of purchase will be refunded
  • There is no provision for any plan renewal or any renewal policy thereafter

Benefits of LIC Senior Citizen Scheme

When you compare plans, you will find these benefits and advantages associated with these pension schemes:

  • These pension plans provide the benefit of regular Pension Payments. On survival of the Pensioner during the policy term, pension in arrears shall be payable. It will be according to the mode chosen at the end of each term
  • The nominee or the family members of the pensioner receive the death benefits upon the death of the Pensioner during the policy term. In such cases, the Purchase Price shall be refunded to the beneficiary
  • The pension plans are also associated with a Maturity Benefit. On survival of the pensioner till the end of the policy term, the purchase price along with the final pension installment gets payable to them
  • These plans are exempt from goods and service tax. LIC Jeevan Shanti provides tax benefits under Sec 80D of the Indian Income Tax act
  • These plans provide the flexibility of deposits and assured monthly incomes
  • The loan facility is available in the case of PMVVY

Documents Required for LIC Senior Citizen Scheme Plans

The following documents will be required to be submitted to apply for any of these pension schemes:

  • Identity Proof: Birth Certificate/Driving license/PAN/Voter’s Card
  • Age Proof: PAN/Birth certificate
  • Address Proof: AADHAR/Driving License/passport
  • Income Proof: Salary Slips/Form 16
  • Medical Reports of the subscriber

Inclusions and Exclusions of the LIC Senior Citizen Scheme

  • There are no exclusions under the PMVVY policy, including suicide. In any event of death, the purchase price is paid to the nominee and the policy is terminated. Unlike other plans, this plan ensures full payment of the purchase price even in the event of suicide committed by the policyholder
  • In the case of Jeevan Shanti plan, if the subscriber commits suicide within 12 months from the commencement of the policy. In the case of an immediate annuity, 100% of the purchase price paid shall be paid as surrender value
  • In the case of Deferred Annuity in the case of Jeevan Shanti plan, 80% of the purchase price shall be paid as surrender value

Eligibility Criteria to apply for the LIC Senior Citizen Scheme plans

If you compare plans for various pension schemes, here are the eligibility criteria for them.

Eligibility criteria for the PMVVY scheme are as follows:

  • Minimum Entry Age: Should have completed 60 years
  • Maximum Entry Age: No limit
  • Policy Term: 10 years

The following are the eligibility criteria for an Indian citizen to join the APY scheme:

  • The age of the applicant should be between 18 - 40 years. The minimum contribution period should be 20 years
  • He should have a mandatory savings bank account. If not, he should be able to open one before applying
  • He should be actively using a valid mobile number and furnish its details to the bank during registration

In the case of LIC Jeevan Shanti, the eligibility criteria are as follows:

  • Minimum Entry Age: 30 years
  • Maximum Age: 79-100 years
  • Minimum Purchase Price: Rs. 150,000

Claim Process of the plan

The pension plans have a set maturity time beyond which they reach full term and the investment amount can be recovered.

For PMVYY/Atal Pension Yojna/LIC Jeevan Shanti, you can download the claim form online from the official LIC website. You can also visit the LIC centre and fill a form for the annualization of the amount if you have reached 60 years of age. In case of premature withdrawal of the amount due to terminal illness or death, the spouse or nominee will receive the amount, once the form is duly filled and submitted. The investment will be directly credited to the subscriber’s savings bank account. The pension payment will be through NEFT or any Aadhaar Enabled Payment System.

Plan Renewal Process

If you compare plans, you will find all of these LIC Senior Citizen Pension Plans provide guaranteed retirement income. You can pay a one-time premium, to receive this income either annually, semi-annually, quarterly or monthly as per your chosen option. These plans encourage depositions for a specified period of years, ranging from 10 to 20 years, and there is no option for any renewal policy. The process of payment of pension goes on until the death of the annuitant.

Therefore, there is no provision of plan renewal in case of these plans.

How to buy the LIC Senior Citizen Scheme Plans?

LIC of India Senior Citizens scheme policies can be purchased offline as well as online. You can compare plans to find out the best one for you. The process requires certain steps which are discussed below:

  1. Online Purchase

    • To purchase this scheme online log on to LIC India’s official website
    • You can register yourself by submitting your details like name, DOB, contact number and email id
    • Click on the tab “New User". You can select your user-id and password to be a registered Portal user
    • You can log in through this newly created user id. Then click on the option of ‘Basic Services’>>“Add Policy”
    • Based on your requirements, you can choose the best plan and the sum assured 
    • Submit the required documents online as discussed in the section above. You can upload the scanned image of the PAN Card/Aadhaar Card/Passport
    • You can make the final payment after selecting the desired payment type and click “Submit”
    • For Atal Pension Yojna, you need to download the form, fill it completely and then submit it at the centre
  2. Offline

    LIC call centre is open and you can contact between 8 am to 8 pm on weekdays and between 10 am to 6 pm on Saturdays (working days only), for answering your queries

    • You can call at their Customer Service Number at 022-68276827
    • You can contact the agent and send an SMS to their number for a call-back
    • You can visit the nearest branch centre with the necessary documents and complete your KYC there
    • Once you have selected a plan or a policy, you can make the premium payment there


  • Q: What is the “free Look period” provided with these LIC Senior Citizen Scheme policies?

    Ans: When you purchase a policy, whether online or offline, it comes with a free look period. It comes along with a Free Look Period of 30 days if the policy is purchased online and for 15 days otherwise. This starts from the date of receipt of the policy document. The policyholder is given an opportunity in this time to review the terms and conditions of this policy. If he disagrees with any of the terms and conditions mentioned in the policy document, he has the option to return this policy after providing the reason to return the policy.
  • Q: What do you mean by surrendering the policy?

    Ans: The scheme allows the pensioner to exit prematurely under exceptional circumstances. This can be when the Pensioner needs money for treatment of critical or terminal illness of Spouse or self. The payable surrender value payable will be 98% of the price of purchase in such cases of policy exits. There is no renewal policy after the surrender.
  • Q: How can you take a loan on the policy?

    Ans: In the case of PMVVY, the pensioner can avail of a policy loan after the completion of three policy years from the date of commencement of the policy. 75% of Purchase Price will be the maximum amount for which the loan will be made available. Interest on the loan will be charged as per the frequency of pension payment chosen by the pensioner. It will be deducted from the pension installment at the interest rate specified when the loan is made. The loan interest amount will be recovered from the next pension installment.
  • Q: Can everyone apply for Atal Pension Yojna?

    Ans: No, the Atal Pension Yojana is mainly for workers from the unorganized sector. If you are covered by any social security scheme like Employees Provident Fund, Coal Mines Provident Fund, Assam tea Plantations Provident Fund or any other lawful scheme, you will not be eligible to seek pension under this Yojna.
  • Q: Do I need a compulsory AADHAR number to open an APY account?

    Ans: Though it is not mandatory to provide Aadhaar number for opening the APY account, you will necessarily need it for enrolment as the primary KYC document. Here AADHAR would be required to identify f spouse and nominees to avoid disputes regarding pension rights and entitlement in the long-term.
  • Q: Is Nomination mandatory to join the scheme?

    Ans: Yes, it is mandatory to give nominee details in case of opening an Atal Pension Yojna account. The personal and AADHAR details of the spouse are also mandatory wherever required.
Written By: Paisawiki - Updated: 12 April 2021