LIC Jeevan Akshay VII

LIC Jeevan Akshay VII: A Detailed Guide The Life Insurance Corporation of India (LIC) is a leading name in the life insurance sector, offering a wide range of policies that cater to different financial needs. One of its most popular offerings is the LIC Jeevan Akshay VII plan, a single premium, non-linked, non-participating, immediate annuity plan that provides policyholders with a guaranteed income for life. This plan is ideal for individuals who are looking for a reliable and steady source of income after retirement, or for those who wish to ensure financial security for their loved ones. In this comprehensive guide, we will explore the various features, benefits, and options available under LIC Jeevan Akshay VII, and explain why it is considered one of the best retirement solutions in India.

Table of Contents

What is LIC Jeevan Akshay VII?

LIC Jeevan Akshay VII is a single premium annuity plan that allows policyholders to make a one-time payment (premium) and receive regular annuity payments throughout their lifetime. The annuity can be received immediately after purchasing the policy, which makes this plan a great option for individuals who want to ensure a steady income flow in their retirement years. Unlike some other retirement plans, which involve a waiting period, the annuity payments under Jeevan Akshay VII begin right after the purchase of the policy. What sets this plan apart is its flexibility—policyholders can choose from a variety of annuity options based on their needs and preferences. The annuity amount depends on factors such as the premium paid, the annuity option chosen, the age of the policyholder, and the type of annuity.

Key Features of LIC Jeevan Akshay VII

Single Premium Payment: The policyholder is required to make only a one-time premium payment to purchase the plan. There are no subsequent premiums, and the annuity starts immediately after the premium is paid.
Guaranteed Lifetime Annuity: The primary feature of the plan is that it guarantees a regular income (annuity) for the policyholder’s lifetime. Depending on the chosen annuity option, the nominee or legal heirs may also continue to receive benefits after the policyholder’s demise.
Multiple Annuity Options: LIC Jeevan Akshay VII offers several annuity options to cater to different financial needs. These options provide flexibility in terms of the frequency of payments, the payout amount, and the benefits available to the nominee or family members after the policyholder’s death.
Immediate Annuity: The plan offers an immediate annuity, which means the policyholder starts receiving annuity payments right after purchasing the policy. There is no deferment or waiting period.
Choice of Annuity Mode: The policyholder can choose the frequency of annuity payments—monthly, quarterly, half-yearly, or yearly—based on their financial requirements.
No Medical Examination: LIC Jeevan Akshay VII does not require the policyholder to undergo any medical examination, making it accessible to a wide range of people, including those with pre-existing medical conditions.
Loan Facility: In certain cases, after the policy has been in force for a specified period, the policyholder may avail of a loan against the policy, depending on the chosen annuity option.
Return of Purchase Price: Some annuity options under LIC Jeevan Akshay VII offer the return of the purchase price (the premium amount) to the nominee after the policyholder’s death, ensuring that the family continues to be financially supported.
Minimum and Maximum Entry Age: The minimum entry age for the policy is 30 years, and the maximum is 85 years. This broad age range makes the plan suitable for both younger individuals looking for a long-term income stream and older individuals seeking immediate retirement benefits.

Annuity Options under LIC Jeevan Akshay VII

One of the highlights of LIC Jeevan Akshay VII is the wide variety of annuity options it offers. Each option caters to different needs, and the policyholder can choose the one that aligns with their financial goals. The options include:

Option A: Annuity for Life: Under this option, the policyholder receives a fixed annuity for life. Once the policyholder dies, the annuity payments stop, and no further benefits are payable to the nominee.
Option B: Annuity for 5, 10, 15, or 20 Years and Life Thereafter: In this option, the policyholder receives annuity payments for a guaranteed period (5, 10, 15, or 20 years). If the policyholder passes away within this period, the annuity continues to be paid to the nominee for the remaining term. After the guaranteed period, the annuity continues for the lifetime of the policyholder.
Option C: Annuity with Return of Purchase Price on Death: This option provides annuity payments to the policyholder for life, and after the policyholder’s death, the purchase price (premium) is returned to the nominee.
Option D: Increasing Annuity: This option offers an annuity that increases by 3% every year, providing protection against inflation. The annuity is paid for the policyholder’s lifetime, but there are no further benefits after their death.
Option E: Joint Life Annuity: Under this option, the policyholder and their spouse receive annuity payments for life. After the policyholder’s death, the spouse continues to receive the annuity for life. No further benefits are paid after the spouse’s demise.
Option F: Joint Life Annuity with Return of Purchase Price on Death: This is similar to Option E, but with the added benefit that after the demise of both the policyholder and the spouse, the purchase price is returned to the nominee.

Eligibility Criteria for LIC Jeevan Akshay VII

Minimum Entry Age: 30 years
Maximum Entry Age: 85 years
Minimum Purchase Price: ₹1,00,000 (for annuity payments up to ₹12,000 annually)
No Maximum Limit: There is no maximum limit for the purchase price, which means policyholders can invest as much as they want, depending on their financial situation and income requirements.

Benefits of LIC Jeevan Akshay VII

Regular Income for Life: The primary benefit of LIC Jeevan Akshay VII is the guaranteed annuity payments for the policyholder’s lifetime. This provides financial stability and ensures that the policyholder has a steady source of income even after retirement.
Choice of Annuity Options: The flexibility in annuity options allows the policyholder to tailor the plan according to their financial needs. Whether they want to ensure income for their spouse after their death, receive increasing annuities to combat inflation, or guarantee payments for a fixed term, the plan has options for everyone.
Return of Purchase Price: Some annuity options offer the return of the purchase price to the nominee after the policyholder’s death, ensuring that the initial investment is passed on to the family.
Loan Facility: In certain annuity options, the policyholder can avail of a loan against the policy after a specified period, providing liquidity during emergencies.
No Medical Examination: LIC Jeevan Akshay VII does not require a medical exam, making it accessible to people of all health conditions.
Tax Benefits: The premiums paid under LIC Jeevan Akshay VII are eligible for tax deductions under Section 80CCC of the Income Tax Act. However, the annuity payments received by the policyholder are taxable as income.

Disadvantages of LIC Jeevan Akshay VII

No Flexibility in Annuity Payouts: Once the annuity option is chosen, it cannot be changed. This means that the policyholder must carefully consider their financial needs before selecting an option.
Annuity Payments are Taxable: While the premiums qualify for tax deductions, the annuity payments received by the policyholder are subject to taxation under the prevailing income tax laws.
Lower Returns Compared to Market-Linked Products: LIC Jeevan Akshay VII offers guaranteed income, but the returns may not be as high as those offered by market-linked retirement products, such as mutual funds or equity-based investments.

Who Should Buy LIC Jeevan Akshay VII?

LIC Jeevan Akshay VII is ideal for individuals who:

Want a steady and guaranteed source of income after retirement.
Prefer a single premium plan where they don’t have to make regular premium payments.
Need financial security for themselves and their spouse in their later years.
Are looking for flexibility in annuity options, including increasing annuities or joint-life benefits.
Want to ensure that their purchase price is returned to their family after death.

Conclusion

LIC Jeevan Akshay VII is a well-rounded and comprehensive annuity plan that caters to the diverse financial needs of retirees and individuals looking for a guaranteed income stream. With its wide range of annuity options, flexible payment modes, and lifetime benefits, it provides a reliable solution for financial stability during retirement. While the returns may not match market-linked products, the security and predictability it offers make LIC Jeevan Akshay VII an excellent choice for risk-averse individuals looking for peace of mind in their post-retirement years.