Investing our hard earned money is a wise decision. However, the challenge really is where to invest . If you research on your own regarding possible investment opportunities (talking about Policy only), you will be overwhelmed with options out there. And let me tell you each plan that you study contain so much technical things that it becomes impossible to understand it all.
Today we are discussing a very Popular Plan by Life Insurance Corporation of India (LIC) called the LIC New Pension Plus Plan i.e. Plan 867. This is an excellent plan to build your corpus year by year. This article not only provides you detailed information on New Pension Plus plan but also provides you a highly accurate calculator that explains the calculations based on the data you provide. This calculator provide you custom pdf report based on your choices. We are sure it will help you understand key details on LIC’s Plan no. 867.
Planning for a secure and comfortable retirement is one of the most important financial goals for everyone. LIC’s New Pension Plus Plan, also known as Plan No. 867, is designed to help you achieve this goal with systematic savings and flexible investment options. This comprehensive guide will explain everything you need to know about the plan in the simplest terms, ensuring you make informed decisions about your financial future.
What is LIC’s New Pension Plus Plan?
LIC’s New Pension Plus Plan is a retirement savings plan that lets you invest your money to build a fund for your future. This fund can be used to get a regular income (pension) after retirement. Since it is linked to the market, the returns you get depend on how well your chosen investment funds perform. It’s not a traditional plan with fixed returns but offers a chance for higher growth based on market performance.
Important Note: In this policy, the investment risk in the portfolio is borne by the policyholder.
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Who Should Consider This Plan?
This plan is ideal for individuals:
👉 Aged 25 to 75 years who want to start planning for retirement.
👉 Looking for flexible investment options with market-linked returns.
👉 Wanting guaranteed additions to their investment.
👉 Seeking the ability to customize their policy term and vesting options.
Key Features of LIC’s New Pension Plus 867 Plan
1. Flexible Premium Payment Options
Single Premium: Pay a one-time premium and enjoy the benefits for the policy term.
Regular Premium: Pay premiums annually, half-yearly, quarterly, or monthly.
Minimum Premium Amounts
Let’s understand what are the minimum Premium Amounts based on Premium Type i.e. Single Premium and Regular Premium. Do understand for the Regular Premium we have annual, half-yearly, quarterly and monthly payment options. For Single premium as the name suggests there is going to be only one, one time payment.
Here are the minimum premium amounts possible under this plan
Single Premium: ₹1,00,000
Regular Premium:
- Annual: ₹30,000
- Half-Yearly: ₹16,000
- Quarterly: ₹9,000
- Monthly: ₹3,000
2. Policy Term and Vesting Age
- Policy Term: Choose between 10 to 42 years.
- Vesting Age: The age at which you start receiving pension benefits, ranging from 35 to 85 years.
3. Guaranteed Additions
Guaranteed additions are a unique benefit of this plan. They increase the value of your investment at specific intervals, provided your policy is in force. Here is how it works:
| Policy Year | Guaranteed Additions (Regular Premium) | Guaranteed Additions (Single Premium) |
|---|---|---|
| 6th Year | 5% of Annual Premium | 4% of Single Premium |
| 10th Year | 10% of Annual Premium | 5% of Single Premium |
| 11th–15th | 4% of Annual Premium | 1.25% of Single Premium |
| 16th–20th | 5.5% of Annual Premium | 1.5% of Single Premium |
| 21st–25th | 7% of Annual Premium | 2% of Single Premium |
4. Fund Options for Investment
You can choose from four types of investment funds based on your risk appetite:
Pension Bond Fund: Low risk, invests primarily in government securities.
Pension Secured Fund: Lower to medium risk, a mix of fixed income and equities.
Pension Balanced Fund: Medium risk, balanced investments in equity and debt.
Pension Growth Fund: High risk, focuses on equity for long-term growth.
You can switch between these funds up to 4 times a year for free.
5. Death Benefits
If the life assured passes away before the vesting date, the nominee can choose one of the following:
- Withdraw the entire fund value.
- Purchase an annuity (regular income) from LIC or another insurer.
The death benefit is the higher of:
- Fund Value as on the date of intimation of death.
- 105% of the total premiums paid, reduced by withdrawals made in the last two years.
6. Vesting Benefits
On survival till the end of the policy term, the fund value is paid as the vesting benefit. The policyholder can:
- Purchase an immediate or deferred annuity from LIC.
- Withdraw up to 60% of the fund value as a lump sum (commutation).
- Purchase an annuity from another insurer for up to 50% of the proceeds.
7. Partial Withdrawals
After the 5-year lock-in period, you can make partial withdrawals for specific needs like:
- Children’s education or marriage.
- Purchase or construction of a house.
- Treatment of critical illnesses.
8. Option to Extend Vesting Date
You can defer the vesting date within the same policy, subject to conditions, to allow your corpus to grow further.
Charges Under the Plan
Most of the times we don’t consider various charges that are deducted in the plan. We however, recommend all of you to closely understand these because they do make a difference. That’s why this section is here to explain about various charges included in the Plan 867 of LIC.
Premium Allocation Charge:
The Premium Allocation Charge is a fee deducted from the premium you pay before it is invested in your chosen fund. This charge is applied as a percentage of the premium amount and is used to cover the costs associated with issuing and maintaining the policy, such as administration, agent commissions, and other operational expenses.
Rates Vary by Policy Type:
Regular Premium Policies:
1st Year: 7% of the premium is deducted.
2nd to 5th Year: 4% to 4.5% is deducted.
6th Year Onwards: Reduces further to around 3% to 3.5%.
Single Premium Policies:
Offline Purchase: 3.3% of the premium is deducted.
Online Purchase: Lower, at 1.5% of the premium.
Policy Administration Charge:
The Policy Administration Charge is a monthly fee deducted from your investment to cover the administrative expenses of managing the policy. This charge is taken by canceling units from your fund value and is applicable only for the first five policy years.
It is calculated as a percentage of the installment premium or a fixed amount, whichever is lower.
Fund Management Charge (FMC):
FMC or Fund Management Charge as the name suggests is a charge that is levied for managing the funds.
0.8% to 1.35%, depending on the fund.
Switching Charge:
₹100 per switch after 4 free switches per year.
Why Choose LIC’s New Pension Plus Plan?
✅ Customizable: Choose your premium, policy term, and fund.
✅ Flexibility: Options to switch funds and make partial withdrawals.
✅ Transparency: Clear charges and fund performance.
✅ Market-Linked Growth: Higher potential returns compared to traditional plans.
How to Buy This Plan
Offline: Through LIC agents or branches.
Online: Visit LIC’s official website and follow the simple steps to purchase the policy.
LIC’s New Pension Plus Plan is an excellent choice for individuals looking to secure their retirement with the dual benefit of guaranteed additions and market-linked growth. Its flexibility and wide range of features make it a reliable partner for your long-term financial goals.
LIC New Pension Plus Plan 867 Calculator
Our LIC Table Plan 867 Calculator gives you precise report based on your custom inputs. Just ensure that you correctly provide the asked information. To help you better with correct inputs we have integrated the information within the calculator below. If you are somehow entering value that is not valid as per the plan, you will be informed and told what correct value ranges are.
After entering all required data, click on the “Calculate” Button. In less than a minute you shall see the report in new tab. You can even download it on your computer or mobile phone.
Quick Links
Here is the official information related to LIC New Pension Plus Policy that every interested person should read.
| Official Website | Visit Now |
| Sales Brochure | Download PDF |
| Policy Document | Official PDF |