Pradhan Mantri Vaya Vandana Yojana (PMVVY) was announced in Union Budgets of 2017-18 and 2018-19. PMVVY scheme envisages an assured payout of annuity at a specified rate for 10 years. In this post, let’s discuss the benefits and features of PM Vaya Vandana Yojana.
The PMVVY scheme is now extended up to March 31, 2023 for a further period of three years beyond 31st March 2020. This pension scheme is for citizens aged 60 years and above. The scheme offered and managed by the Life Insurance Corporation of India (LIC).
Table of Contents
Pradhan Mantri Vaya Vandana Yojana (PMVVY)
Pradhan Mantri Vaya Vandana Yojana (PMVVY) is an immediate annuity scheme. The scheme provides an assured payout of pension at a specified rate for 10 years. And, the purchase price shall be returned at the end of the policy term of 10 years.
This pension scheme provides an immediate pension for senior citizens aged 60 years and above. Pension starts as early as next month if the monthly mode chosen for the annuity.
The PMVVY pension scheme also offers a death benefit in the form of return of purchase price to the beneficiary. The PMVVY pension scheme is open for subscription till March 31, 2023.
Validity of the PMVVY
The Pradhan Mantri Vaya Vandana Yojana is open for subscription till March 31, 2023. This pension plan is operated by the Life Insurance Corporation of India (LIC). You can purchase this pension scheme offline as well as online from the LIC website www.licindia.in.
Eligibility conditions for PMVVY
Following are the eligibility conditions to apply for Pradhan Mantri Vaya Vandana Yojana:
1. The applicant must be a senior citizen aged 60 years and above.
2. The subscriber must be a citizen of India.
3. There is no maximum age of entering into the PMVVY scheme.
4. The subscriber must be ready for a policy term of 10 years.
Documents Required for PMVVY Scheme
Following necessary documents required to subscribe under the PMVVY:
1. Aadhaar Card
2. Proof of Age
3. Proof of address
4. Passport size photo
5. Documents to show that the applicant has retired from employment
Features & Benefits of PM Vaya Vandana Yojana
Following are the key features and benefits of PMVVY scheme:
1. The PMVVY scheme provides subscribers with an assured rate of return of 7.40 % per annum for the year 2020-21 per annum and thereafter to be reset every year.
2. The pension shall be paid in arrears to the pensioner during the policy term of 10 years. The pension shall be paid at the end of each period as per payment mode is chosen by the pensioner at the time of purchase.
3. Annual reset of the assured rate of interest with effect from 1st April of the financial year in line with the revised rate of returns of Senior Citizens Saving Scheme up to a ceiling of 7.75% with a fresh appraisal of the scheme on breach of this threshold at any point.
4. The purchase price shall be refunded to the beneficiary/nominee in the event of the death of the pensioner during the policy term of 10 years.
5. On survival of the pensioner, the purchase price along with the final annuity installment shall be returned to the pensioner as maturity benefit.
6. Loan of up to 75% of the purchase price can be availed after completion of 3 policy years to meet emergencies.
7. The scheme exempted from Goods and Services Tax (GST).
8. The premature exit allowed for treatment in case of medical emergencies/critical illness of self or spouse. On such an exit, 98% of the purchase price is refunded.
9. The ceiling of maximum pension is per senior citizen i.e. the total amount of pension under all the policies under this plan.
Minimum and maximum Pension under different modes of Pension
| Mode of Pension | Minimum Pension Amount | Maximum Pension Amount |
| Yearly | Rs. 12,000 per annum | Rs. 1,20,000 per annum |
| Half-Yearly | Rs. 6,000 per half-year | Rs. 60,000 per half-year |
| Quarterly | Rs. 3,000 per quarter | Rs. 30,000 per quarter |
| Monthly | Rs. 1,000 per month | Rs. 10,000 per month |
The ceiling of maximum pension is per senior citizen i.e. the total amount of annuity under all the policies under this plan
Minimum Purchase Price
The minimum investment in the scheme for getting a minimum pension of Rs.1000 per month is Rs.1,62,162/-. The minimum investment for getting a minimum pension of Rs.12,000/- per annum is Rs.1,56,658/- under the scheme.
Application Process of the Scheme
Senior citizens can purchase this plan by paying a lump sum amount. You can purchase it via offline as well as online mode. There are two ways to get enrolled in the PMVVY scheme:
1. Online Process
2. Offline Process
PMVVY Online Process
To buy PMVVY online, follow the steps mentioned below:
1. First of all, visit the official website of LIC www.licindia.in.
2. Click on the “Products” option on the main menu.
3. Select “Pension Plan” from the drop-down menu and proceed.
4. Fill the application form.
5. Submit the online form and upload the required documents for further process.
Offline Process
1. Go to any branch of LIC.
2. Collect the application form and fill it.
3. Attach the relevant documents after self-attesting them.
4. Submit the duly filled form along with the documents to any LIC branch.
Modes of Pension Payment
The modes of annuity payment under Pradhan Mantri Vaya Vandana Yojana are monthly, quarterly, half-yearly, and yearly. You will get your annuity via NEFT or Aadhaar Enabled Payment System.
Additional Features of PMVVY
Some additional features of Pradhan Mantri Vaya Vandana Yojana are:
1. Medical: No medical examination required.
2. Surrender Value: The premature exit permitted for the treatment of any critical/ terminal illness of self or spouse. In such cases, the surrender value is 98% of the purchase price.
3. Loan: Loan facility is available under this plan after completion of 3 policy years. The maximum loan amount is up to 75% of the purchase price.
4. Free Look period: If a policyholder not satisfied with the “Terms and Conditions” of the policy, he/she may return the policy to the LIC within 15 days (30 days if this policy purchased online) from the date of receipt of the policy stating the reason of objections.
5. Suicide: There shall be no exclusion on count of suicide and full Purchase Price shall be payable.
Final Thoughts
The government of India extends Pradhan Mantri Vaya Vandana Yojana (PMVVY) for three years. That means the PMVVY pension scheme for senior citizens will be valid till March 31, 2023. You can buy PMVVY scheme from Life Insurance Corporation of India (LIC).
Now it provides an assured rate of return of 7.40 % per annum for FY 2020-21 and thereafter to be reset every year. Therefore, if you are a senior citizen and have a lump sum money, then you can consider buying this pension scheme.
Note: This post was originally published on June 15, 2018 and has been completely updated for accuracy and comprehensiveness.
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