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  • SBI Life Insurance Pension Plans

    SBI Life

    Overview

    The quality of life is rapidly changing in India. While the jury is still out on whether the changes are for better or worse, all the same, retirement planning in India is of utmost importance given the increasing rate of life expectancy, skyrocketing health care expenses and lack of robust social security measures among many others. You should plan ahead to ensure that you can maintain the same lifestyle and meet any unforeseen expenses when you are old and grey. SBI is currently offering three pension plans and life insurance plan for the benefit of customers.

    Types of SBI Pension Plans

    1. SBI Life- Saral Pension

    2. SBI Life- Annuity Plans

    3. SBI Life-Retire Smart

    1. SBI Life- Saral Pension

    This is an individual, non-linked traditional participating pension plan which provides safety from market fluctuations. Premiums are paid during the policy term. The minimum sum assured is Rs.1 lakh while there is no limit to maximum. Minimum premium is Rs.7,500 p.a while there is no limit to maximum.

    Benefits of SBI Life- Saral Pension

    The benefits of this plan are as follows:

    • Vesting benefit: The vesting benefit proceed will be higher of sum assured or total premiums paid at 0.25%p.a compounded annually in addition to vested simple reversionary bonus and terminal bonus.
    • Death benefit: If the life assured dies, the proceeds - higher of total premiums paid at 0.25%p.a compounded annually in addition to vested simple reversionary bonus and terminal bonus or 105% of the total premiums will be paid to the nominee. The nominee can either get the entire proceeds as a lumpsum or buy annuity at the prevailing rate.
    • Guaranteed bonus: Guaranteed simple reversionary bonus is offered at 2.5% for the first three years and 2.75% for the remaining two years.
    • Flexible: Customers can defer their vesting date till 70 years.
    • Life cover: Customers can also opt for additional life cover through preferred term rider.

    2. SBI Life- Annuity Plans

    This is a traditional, non-participating annuity plan, offering a wide range of annuity options. With the help of this plan, customers can have a regular income or annuity payout from 40 years.

    The benefits of this plan are as follows:

    • Allows policyholders to choose from a wide array of annuity options
    • Customers can avail of a regular income.
    • Policyholders have an option to have Lifetime Annuity payout for their family members as well.
    • Customers have the flexibility to choose from various annuity payouts such as monthly, quarterly, half-yearly or yearly.
    • Policyholders can avail of incentives of higher annuity rates for large premiums.
    • This plan also allows customers the flexibility to advance their annuity payouts.
    • Customers can opt for the SBI Life - Accidental Death Benefit Rider.
    • This plan offers the following annuity options:
      • Life Annuity: This option entails annuity payout at a guaranteed rate. Customers can choose from various options, namely, lifetime income, lifetime income with capital refund and lifetime income with capital refund in parts.
      • Lifetime income with Balance Capital Refund: This entails annuity payment at a constant rate. Upon death, the balance capital is paid.
      • Lifetime income with Annual Increase of 3% or 5%: Under this option, annuity payout increases at 3% to 5% p.a. Upon death, all future annuity payouts cease.
      • Lifetime income with certain period of 5, 10, 15 or 20 years and life thereafter: Annuity is paid at a constant rate for a minimum of 5, 10, 15 or 20 years and throughout the life of the annuitant thereafter.
      • Life Annuity: Under this option, the annuity payment continues at a guaranteed rate. Customers can choose from several options such as life and last survivor, income without capital refund and life and last survivor.

    3. SBI Life-Retire Smart

    This is a non-participating unit-linked pure pension plan. SBI Life-Retire Smart guarantees customers a minimum of 101% of all premiums paid in addition to guaranteed additions of 10% of annual premium from the end of 15th policy year till the end of policy term.

    The benefits of this plan are as follows:

    • Vesting Benefit: Upon completion of policy term, customers will receive the higher of fund value plus terminal addition or 101% total premiums. Customers can avail of the following options on maturity or vesting:
      • Buying immediate annuity from the policy proceeds.
      • Buying a single premium deferred product.
      • Immediate annuity along with an option to commute 1/3rd of the proceeds.
      • To extend the accumulation period provided customers are below 55 years. The maximum period is 80 years.
    • Death Benefit: In the event of death of the Life Assured, higher of fund value plus terminal addition or 105% of total premiums is paid. The nominee can either receive the proceeds as a lump sum or use them to buy an annuity at the prevailing rate.
    • Tax Benefits: Premiums paid are eligible for tax deduction under Section 80 C of the Income Tax Act, 1961. Upon vesting or discontinuance, policyholders can commute up to 1/3rd of the proceeds (commuted value is tax exempt under Section 10(10A) (iii) of the IT Act). The non-commuted amount (immediate annuity) is, however, taxable.
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