Thursday, February 23, 2012

14 ways to get your pension with SBI Life Annuity Plus Plan

SBI life has come up with new pension plan where in one can invest a lump-sum amount and start getting annuity (pension). The minimum age for entry in this plan is 40 years. 

In a summary, we can say that it's like that they are paying the "interest" on your money invested with them.

SBI life provides 14 different ways to get your annuity from that amount. You can choose life-time annuity WITHOUT return of premium amount or life time annuity WITH return of premium or annuity for both husband and wife (joint life) and so on.

You can even transfer your existing pension plan from any other life insurance company to SBI life insurance.


  • Complete freedom to choose from a wide range of Annuity options
  • Enjoy a regular income (“annuity payout”) from an early age of 40 years
  • You have an option to have Lifetime Annuity payout for you as well as a family member
  • Flexibility to choose frequency of annuity payouts as per your requirements – Monthly, Quarterly, Half-yearly or Yearly
  • Incentives of higher annuity rates for large premiums
  • Option of availing SBI Life- Accidental Death Benefit Rider (UIN:111B015V01)
  • Flexibility to advance your Annuity payouts
  • Return of premium options 

But remember the following fine prints:

  • You need to pay service tax extra at the rate of 1.545% of your premium amount to invest in this plan.
  • The annuity (pension) received by you will be taxable (as per current income tax rules).
  • The rate of return in annuity plans (here also) are generally less than market rates. E.g., as on today, you can get more interest from your bank FD (with monthly amount payout option) rather than choosing annuity from this SBI Plan.
  • The entire money gets in lock-in period. So, there is no liquidity of your money. 


I've made one sample benefit illustration from the official website of SBI Life for a healthy male age 40 years, with annuity choosen as life time annuity with Capital refund option for annuity required Rs.6 lacs per annum.

The total premium one has to pay is Rs.80,21,862.25 + service tax of Rs.1,23,938 = Rs. 81,45,801

Download this illustration from here and its official brochure from here.

You can also download the sample annuity yield on different starting age and premium amount to understand this product fully.

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