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  • Aviva Next Innings Pension Plan

    Aviva Life Insurance

    Overview

    Life after retirement need not be a highly regimented financial tightrope. There is a way you can live a comfortable lifestyle post-retirement, using Aviva’s Next Innings Pension Plan. It ensures a lump sum payment at plan maturity to carry you through your post-retirement years.

    Eligibility Conditions of Aviva Next Innings Pension Plan

    Entry Age

    Minimum: 42 years

    Maximum: 60 years

    Maturity Age

    Minimum: 55 years

    Maximum: 78 years

    Key Features of Aviva Next Innings Pension Plan

    Policy term and Premium paying term

    Policy Term

    Premium Paying Term

    13 years

    Single

    16 years

    5 years

    18 years

    10 years

    Premium details

    Premium Payment Term

    Minimum Premium Amount

    Maximum Premium Amount

    Single

    Rs.1,50,000

    Rs.5,00,00,000

    Limited

    Rs.50,000 per annum

    Rs.5,00,00,000

    Premium payment frequency

    The following premium payment options are available:

    • Single.

    • Annual.

    • Bi-annual (half-yearly).

    • Monthly.

    Bi-annual and monthly premiums are calculated as under:

    Half Yearly = Annual premium x 51.08%

    Monthly = Annual premium x 8.71%

    Type

    Non-linked, non-participating deferred pension plan.

    Coverage

    • Maturity benefit: 210% of your premiums will be returned at the maturity date, guaranteed by Aviva. The policy will then compulsorily be used to:

      • Purchase immediate annuity: The annuity purchased will be guaranteed for the life of the insured person. The policyholder also has the option to commute a certain proportion of the proceeds (up to the maximum allowed, which is 1/3rd of the maturity proceeds). The remaining maturity proceeds will be used to purchase annuity on the life of the insured person. The annuity being purchased must be purchased through Aviva Life Insurance Co., unless otherwise specified by the IRDA.

      • Purchase a single premium deferred pension plan: If the policyholder meets the criteria, he or she can invest in a single premium deferred pension plan. This plan too must be purchased through Aviva Life Insurance Co., unless otherwise specified by the IRDA.

    • Death benefit: In case the policyholder dies, he will be paid the higher of:

      • Premiums paid till the date of death plus interest at the rate of 6%, compounded annually (this is excluding extra premiums and taxes).

      • 105% of all premiums paid till the date of death (excluding extra premiums and taxes).

    Under the death benefit, the nominee has the option to re-invest the death benefit amount in an Aviva annuity plan (only if he or she is eligible), or withdraw the amount entirely. It should be noted that the amount of annuity will depend on the prevailing rates of annuity.

    Loan

    Not available under this plan

    Surrender Value

    • Single Premium Policies can be surrendered at any time, but only after the completion of the first policy year with premium being paid up.

    • Limited Premium Policies can be surrendered at any time, but only after the receipt of the premiums for 2 policy years.

    Guaranteed Surrender Value (GSV):

    GSV = GSV factor x premiums paid (excluding taxes and extra premiums).

    • Limited Premium Policies with a 5-year premium paying term have surrender values starting at 30% in the second policy year up to 180% in the 16th year.

    • Limited Premium Policies with a 10-year premium paying term have surrender values starting at 30% in the second policy year up to 180% in the 18th year.

    • Single Premium Policies have surrender values starting at 70% in the second policy year up to 180% in the 13th policy year.

    Special Surrender Vale (SSV):

    SSV = SSV Factor x Paid-up Value (where the Paid-up Value is 210% of the Premiums paid, excluding extra premiums and taxes).

    • The SSV Factor is revised every so often, it is recommended to check with the Aviva branch offices to ascertain the Surrender Value.

    • The proceeds that the policyholder will receive on surrendering the policy must compulsorily be used to:

      • Purchase a single premium deferred pension product: If the policyholder satisfies the eligibility criteria, he or she must purchase a single premium deferred pension plan from Aviva Life Insurance Company, Ltd. / or follow the IRDA guidelines that will apply at the time.

      • Purchase Immediate Annuity: This Annuity will be immediately payable for the life of the insured for as long as he or she is alive. The policyholder also has the option of commuting a proportion of the surrender proceeds (currently, the maximum allowed is 1/3rd of the surrender proceeds). The remaining amount of surrender proceeds after commutation will be used to purchase annuity on the life on the insured. This too can only be purchased from Aviva Life Insurance Company Ltd. / or depending on the IRDA guidelines that apply at the time.

    Free look period

    Customers can return the policy within 15 days from the date of receipt of policy, if anything is not to their specific liking. The policy document must be returned after stating the reason for objecting to or returning the same. The entire premium paid will be returned after adjusting relevant stamp duty charges and adjusting for cover provided during the free look period.

    Grace period

    30 days grace period for annual and bi-annual premiums, and 15 days for monthly premium payment plans.

    Loan

    Aviva Life Insurance Company Ltd. does not provide any loans against this policy.

    Alterations

    Shifting between annual and bi-annual frequency options and vice-versa is allowed on the payment of the alteration charge of Rs.100 + applicable taxes. Alterations can be done on policy anniversaries only.

    Tax benefit

    This plan offers tax benefits under section 80C and section 10 (10A)(iii) of the Income Tax Act, 1961

    Advantages of the Aviva Next Innings Pension Plan

    • Death and maturity benefits.
    • Surrender benefits
    • Tax benefits under Section 80C and Section 10(10A) (iii) of the Income Tax Act, 1961.
    • Guaranteed corpus upon retirement at 210% of paid-up premiums if the policy is continued till maturity.
    • Limited premium paying term to free up funds and have more disposable income while nearing retirement age.
    • Death benefit paid to nominees based on the amount of premiums paid plus interest.

    How the Plan Works

    Mr. Babu is a 42-year-old techie who decides to invest in Aviva life Next Innings Pension Plan. He invests Rs.1,00,000 for 10 years, which totals up to Rs.10,00,000 at the end of his ten-year premium paying period. His life cover extends throughout this entire time, and at the end of 18 years, when he attains the age of 60, he will receive Rs.21,00,000. Then, Mr. Babu can choose to withdraw up to Rs.7,00,000 and re-invest the remaining amount in Aviva’s Annuity by Aviva scheme for a lifelong income.

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