Financial Daily from THE HINDU group of publications
Wednesday, Jul 23, 2003
Financial Daily from THE HINDU group of publications Wednesday, Jul 23, 2003 |
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Money & Banking
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Pension Plans Look before you jump for Varishtha pension plan Sarbajeet K. Sen
New Delhi , July 22 THOSE of you senior citizens planning to avail of the newly launched Varishtha Pension Bima Yojana, be advised to do a proper homework on your future financial needs before taking the plunge because there might not be a second chance to rectify the decision of taking a cover that provides less pension than the maximum on offer. In what is turning out to be a worrisome feature for those seeking to take the new assured return cover, the policy could well turn out to be a once in a lifetime offer with no facility of taking out a second policy by an individual even if the combined premium of the policies works out to be within the maximum permissible limit of Rs 2,66,665. Thus, if a person has taken a policy by paying a one-time premium of Rs 1 lakh giving a monthly pension of Rs 750 and subsequently wants to hike the pension benefits to the maximum permissible Rs 2,000 a month, he would not be allowed to buy out a second policy by paying the additional sum of Rs 1,66,665. "We are told that the one-time premium is actually only for one time. We find this a very narrow interpretation of the policy that needs to be looked into by LIC. Since the scheme allows for a maximum figure that can be paid as premium, LIC should allow the amount to be broken up in parts by allowing more than one policy being taken out by a person," Mr J.M. Sawhney, Advisor to Ashram Risk Management Insurance Agents, said. He pointed out that several aged persons who had come to the agents for taking a cover had raised the query since they felt that they would like to raise their benefits as and when they are able to generate more funds that can be spared. Mr Sawhney said that he had sought a clarification on the issue from the LIC office in Delhi. "I have been assured by the zonal office that they would seek a clarification from the head office," he said. LIC has been given the sole right to administer the scheme..
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