Investment Plans August 24, 2021

Aditya Birla Sun Life Insurance (ABSLI) Saral Pension is a non-linked non-participating single premium individual immediate annuity plan that provides guaranteed income during your retirement years. Key features of the ABSLI Saral Pension Plan are:

  • Guaranteed Income
  • Flexible option to receive annuity payments
  • Choose the frequency of annuity payout
  • No medical tests required
  • Death Benefit
  • Policy Loan Benefit

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Read this page and know more about these and other benefits of the ABSLI Saral Pension Plan.

ABSLI Saral Pension Plan Guaranteed Income Benefits

You’ll receive guaranteed income during the policy term as per your chosen option.

Option 1: Life Annuity with Return of 100% of Purchase Price (ROP)

If you choose option 1, you’ll get a fixed annuity at policy inception.

Option 2: Joint Life Last Survivor Annuity with Return of 100% of Purchase Price

A fixed annuity shall be payable at policy inception till either of the annuitants is alive.

How to Choose Guaranteed Income Option at Inception?

Step 1: Choose the lump sum amount you want to invest or the annuity you wish to receive.
Step 2: Choose from the annuity options mentioned above
Step 3: Choose the payout frequency – Yearly, Half-yearly, Quarterly or Monthly
Step 4: Provide your details and your partner’s (if you opt for option 2)

Note: Only your spouse can be the Second Annuitant. And once the annuity option is chosen, it cannot be changed thereafter.

The minimum annuity amount is INR 1,000 per month, INR 3,000 per quarter, INR 6,000 per half year and INR 12,000 per year. Whereas, the maximum annuity has no limit and is subject to a Board-Approved Underwriting Policy of Aditya Birla Sun Life Insurance.

Conditions Applicable to the Guaranteed Income Benefit

  • To receive this benefit, you need to submit the Living Certificate in the format prescribed by the insurer at least 30 days before the end of each policy year.
  • In the case of Joint Life, after the death of the Primary Annuitant, the Living Certificate of the surviving annuitant will need to be submitted 30 days before the end of each policy year.
  • The Living Certificate should be duly signed by a gazetted officer or a Registered Medical Practitioner or a scheduled bank branch manager or public notary.
  • If you don’t submit the Living Certificate within the stipulated time, the payment will automatically cease from the commencement of the immediately succeeding policy year until you submit the document.
  • In certain cases, the insurer may require the annuitant to submit the Living Certificate in person.
  • The insurer reserves the right to modify the process and requirements after prior approval of the Insurance Regulatory and Development Authority of India (IRDAI).

ABSLI Saral Pension Plan Death Benefit

In case of death during the policy term, the insurer shall pay the following benefits to the beneficiary.

Option 1: Life Annuity with Return of 100% of Purchase Price

The insurer shall pay 100% of the purchase price to the nominee /legal heirs in a lump sum.

Option 2: Joint Life Last Survivor Annuity with Return of 100% of Purchase Price 

In case of the death of either of the annuitants, the insurer will pay 100% of the annuity as long as one of the other annuitants is alive. Whereas on the death of the last survivor, the annuity will cease immediately and the purchase price shall be payable in a lump sum to the nominee/ legal heirs.
Note: If any annuity is paid after the date of death of the annuitant or the last surviving annuitant before the date of intimation of death, the insurer shall deduct such annuity amount from the death benefit. Once the death benefit is paid, the policy will terminate.

ABSLI Saral Pension Plan Loan Benefit

After six months from the date of commencement of the policy, you can apply for a loan against this pension plan. Under the Joint life option, the loan can be availed by the primary annuitant only, and in case of death of the primary annuitant, this benefit is available to the secondary annuitant. The maximum amount you can borrow is 50% of the annual annuity amount payable under the policy.

The interest on the loan shall be at a 10-year G-Sec rate per annum as on 1st April, of the relevant financial year, as published by M/s. FBIL. 200 bps (2%) will be charged extra for all loans granted during 12 months, beginning 1st May of the relevant financial year. As on 1st May 2020, the compound interest rate applicable is 8.3% p.a.

Note: Any change in the basis of determination of interest rate can be done after getting approval of the IRDAI.

Your loan interest rate will be recovered from the payable annuity amount. The loan interest will accrue as per the frequency of your annuity payment and the same will be due on the date of the annuity. Whereas, the loan outstanding shall be recovered from the claim proceeds. You have the option to repay the loan principal amount during the currency of the annuity payments.

Conditions Applicable to ABSLI Saral Pension Plan Surrender

You can surrender the policy after six months from the date of commencement of risk if you or the spouse or any of the children is diagnosed with any of the 20 specified critical illnesses as shown below:

  • Cancer of Specified Severity
  • Myocardial Infarction (First Heart Attack of specific Severity)
  • Major Head Trauma
  • Major Organ /Bone Marrow Transplant
  • Stroke resulting in permanent symptoms
  • Open Chest CABG
  • Kidney failure requiring regular dialysis
  • Permanent paralysis of limbs
  • Multiple sclerosis with persisting symptoms
  • Motor Neuron Disease with permanent symptoms
  • Open heart replacement or repair of heart valves
  • Third degree burns
  • End-Stage lung failure
  • Benign brain tumor
  • Blindness
  • Coma of specified severity
  • Loss of limbs
  • Primary (Idiopathic) Pulmonary Hypertension
  • End-Stage liver failure
  • Loss of speech

For this, you need to submit the required documents and the same will be examined by the medical examiner of the company. On approval of surrender, 95% of the Purchase Price shall be payable after the deduction of outstanding loan amount and loan interest, if any. On payment of surrender value, the policy will terminate.

ABSLI Saral Pension Plan Policy Term and Premium Payment Option

ABSLI Saral Pension Plan policy term is until the insured is alive. And the premium payment term is single pay, so you’ll only need to pay a one-time lump sum premium. The minimum premium amount is INR 2,14,182.

Eligibility Criteria for ABSLI Saral Pension Plan

You need to meet the following age criteria if you want to purchase the ABSLI Saral Pension Plan:

  • Minimum Entry Age – 40 years
  • Maximum Entry Age – 80 years

Note – In the case of joint life annuities, the age limits shall apply to both lives.

Free Look Period

You will have a free look period of 15 days from the date of receipt of the policy to review the terms and conditions. In case you are not satisfied, return the policy by sending a written notice of cancellation to the insurer. The company will refund the Purchase Price after the deduction of stamp duty and the paid annuity amount (if any).

In case of a standalone immediate annuity policy, the proceeds from cancellation shall be returned to the policyholder. If you have purchased this plan out of the proceeds of a deferred pension plan of any other insurance company, the proceeds from cancellation will be transferred back to that insurance company.

Please note that the free look option can be exercised only if the policy is purchased from funds that are not arising from any of ABSLI pension plans, under which annuitizing is compulsory.

The free look period is 30 days if the policy is purchased through distance marketing like:

  • Telephone-calling
  • Short Messaging Services (SMS)
  • E-mail, internet and interactive television (DTH)
  • Direct postal mail and newspaper & magazine inserts
  • Any means of communication other than in person

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