HDFC Life, a joint venture between HDFC (Housing Development Finance Corporation) and Standard Life plc of the U.K., has come out with two unit-linked retirement plans. The plans are designed to build a sizeable corpus for post-retirement income, and offer assured vesting (maturity) value with minimum guarantee benefits.
Under the HDFC Life Pension Super Plus, the net premium collected will be invested in an exclusive pension fund. It will offer assured death benefit of total premiums paid to date accumulated at a guaranteed rate of 6 per cent per annum, and an assured vesting (maturity) benefit of 101 per cent of all premiums paid. The entry age is 35 to 65 years, and the age at vesting is 55 to 75 years with the policy term at 10/15/20 years. The minimum annual premium is Rs. 24,000.
The maturity benefit will have to be utilised to buy an annuity plan which will provide the post retirement income. In the event of unfortunate demise of policy holder during the policy term, the nominee will receive the death benefit.
Under the HDFC Life single premium pension super plan, the investor will be offered the fund value or the assured benefit of 101 per cent of the single premium paid on death or at the end of the policy term. The policy term is 10 years. The age of entry is fixed at 40 to 75 years and the age of vesting at 50 to 85 years. The minimum single premium is Rs. 25,000 and there is no maximum limit.
Launching the products here on Tuesday, Mr. Sanjay Tripathy, Executive Vice-President (marketing, product and direct channels), said these retirement products were based on the new guidelines issued by the Insurance Regulatory Development Authority (IRDA).
The private insurer also launched New Immediate Annuity Plan, a traditional annuity product that ensures a regular income stream post retirement.
Mr. Tripathy said, “In India, there has been a paradigm shift in retirement trends and the increase in life expectancy. Individuals opt for retirement as early as at 40-45 years and go on to live beyond 80-85 years. This emerging trend is expected to boost the annuity market substantially in the next few years.”