PENSION PLUS (Table No. 803)
( Sample Sales Talk )
Agent : Festival Greetings.
Prospect: Greetings! I received your e-mail on the new plan launched by LIC.
Agent : Please permit me to give a brief introduction about this plan.
Prospect: Well, go ahead.
Agent :This is a Unit Linked Pension plan.
Prospect: How is this plan different from other pension plans?
• This is a unique pension plan where the minimum rate of interest is
• Secondly the rate of interest is applied to the Gross Premiums.
Which means if the premium paid for the year is ` 50,000, then
interest is paid on full amount of ` 50,000. That is, interest is
applied prior to deduction of charges.
• Since this is a unit linked plan it has immense possibility of
• The maturity proceeds under this plan are used for purchasing
Annuity, so this plan ensures good financial planning for the
Prospect: Well, what are the Maturity Benefits under this plan?
Agent :The date on which the policy term ends is called the ‘Date of Vesting’. On
this date, annuity is purchased from the maturity proceeds. The amount
available for purchase of annuity will be the higher of actual Policyholders
Fund Value and Guaranteed Maturity Proceeds.
Prospect :What are Guaranteed Maturity Proceeds?
Agent :The minimum returns are guaranteed under this plan. If all due premiums
are paid till the date of Maturity, then for the total premium paid during
each financial year, interest is accrued on the premium amount. The Rate of
interest is 50 bps more than the average reverse repo rate at the end of the
quarter of the preceding year. This rate may vary from 3% to 6%. The
amount so arrived shall be the Guaranteed Maturity Proceeds. The
Guaranteed rate of return for premiums paid upto 31.03.2011 is 4.5% pa.
Prospect: What could be the maximum returns under this plan.
Agent : Our endeavour shall be to get maximum possible returns on this plan. The
net of premiums shall be invested in the stock market through Debt Fund or
Mixed Fund, as chosen by you.
Prospect: What is the investment pattern for the two funds?
Agent : Debt fund shall have not less than 60% of the amount is invested in
Government/Government Guaranteed Securities or Corporate Debt and not more
than 40% is invested in Money Market Instruments. In respect of Mixed Fund not
less than 45% of the investment is in Government/Government Guaranteed
Securities or Corporate Debt, not more than 40% in Money Market instruments and
15-35% in Equity Shares. The fund value shall be calculated from the NAV of these
Prospect :What if I wish to switch over my fund type?
Agent :Yes, you can do so. Two switches are free during the year, thereafter, there
is a charge of `100/- per switch, you can switch over funds as many times
as you like.
Prospect :What if I wish to pay additional premiums ?
Agent :You can do so by paying top-up premiums during the term except during
last 5 years of maturity.
Prospect: What if I want my maturity proceeds in lump sum.
Agent : You have an option to commute upto 1/3rd of the maturity proceeds. The
balance amount shall be used for purchasing annuity plan from LIC or any
other insurance company as you desire.
Prospect:What happens to my policy if I die during the term?
Agent :In event of your unfortunate death during the term, the person nominated
under the policy has the option to receive the fund value in lump sum or
purchase an annuity plan for himself/herself. Sir, I would like to show you
the Benefit Illustration for your age. For age 30, annual premium
` 25000 and a term of 20 years and provided that all premiums are paid
regularly till the end of the term; assuming gross interest of 10% pa and
investment in debt fund the Fund Value at the end of the term is likely to
Prospect: So, this amount is paid to me if all my premiums are paid within days of
grace. What if I am unable to pay the premiums within the days of grace?
Agent :If you are unable to pay the premiums upto the days of Grace, a notice
shall be sent to you within 15 days of the expiry of the days of grace to
exercise one of the following options within 30 days of receipt of notice:
(i) Revival of the policy
(ii) Complete withdrawal from the policy.
Prospect: What if I do not exercise any option?
Agent :If you do not exercise any option within 30 days from receipt of notice,
then it is assumed that you have exercised the option of complete
Prospect: What if I convey the option to revive my policy?
Agent :For revival of the policy, you are required to pay the arrears of premiums
Prospect: What will be the status of my policy during the notice period?
Agent :The policy shall be treated in-force during the notice period. It is
important to note that all charges will be deducted during this period.
Prospect: What if I decide to withdraw the policy?
Agent : It is always advisable to continue an insurance policy for its full term.
However, if you are unable to pay the premium due to some unfavourable
circumstances and need to terminate the policy before 5 years from
commencement, the monetary value(fund value less discontinuance
charge) of the policy shall be calculated. In case of Single premium plans
there are no Discontinuance charges, so in this case the Monetary Value is
equal to the fund Value. The amount so calculated will earn interest of at
least 3.5% p.a. from the date of withdrawal to the end of 5 years from
commencement. The amount along with the interest will be due to you
only at the end of five years which will be used by you to purchase annuity.
At the end of 5 years you have the option to commute one-third of the
Prospect: What if I withdraw my policy after 5 years?
Agent : There are no discontinuance charges on surrender of Regular premium
policies after 5 years from commencement. Policy holders Fund Value of
such policies shall be due to the life assured immediately for purchase of
Prospect: Can my father who is 70 years old also take the plan, Will the charges be
more for him?
Agent :This plan is available for any one between 18 to 75 years of age. The
vesting age is from 40 to 85 years and the minimum term is 10 years. The
charges will not be more for your father because of age, as there is no risk
cover and the other charges are not age specific.
Prospect :What are the various charges under this plan?
Agent :Besides Premium Allocation charge other charges like Policy Administration
charge, Fund Management Charge shall be deducted.
Prospect :Can I also withdraw partial amount during the term?
Agent :There is no option for partial withdrawal or loan under this plan. However
this plan will help you ensure that the money you save today will provide a
steady income to supplement your income during the retirement years. This
plan will be excellent investment towards essential long term financial
Prospect: I would like to take this plan, as the money that I have in hand today will
help me supplement my future income. How do I go about taking the
Agent : I will assist you with the procedure. This is the Proposal form, I shall help
you with the process of submitting the proposal form and the consideration
amount. Thank you for your patient listening.
PENSION PLUS : ELIGIBILITY CONDITIONS
Age at entry 18 to 75 years
Age at vesting 40 to 85 years
Minimum 10 years
Mode -» RP MLY (ECS) SP
Minimum ` 15000 pa ` 1500 pm ` 30000
Maximum 1 lac 1 lac No limit
Sum Assured NA
PENSION PLUS : CHARGES
Regular Premium Single Premium
Premium 1 st
Allocation nd th 3.3%
2 to 5 4.50%
Top-up premium: 1.25%
Policy Administration ` 30/-pm during the first policy year and
Charge ` 30/- pm escalating at the rate of 3% pa. thereafter.
Fund Management Debt Fund 0.70% p.a.
Charge Mixed Fund 0.80% p.a.
Switching Charge 2 switches free . ` 100 thereafter.
Miscellaneous charge ` 50/- for alteration.
PENSION PLUS: DICONTINUANCE CHARGES
Discontin Annualized premium up to `
uance Annualized premium above ` 25,000/-
Year Discontinuance charges shall be lower of Discontinuance charges shall be lower
Annualised Maximum Annualised Maximum
Premium or Fund Premium or FV
1 10% 2500/- 6% 6000/-
2 7% 1750/- 4% 5000/-
3 5% 1250/- 3% 4000/-
4 3% 750/- 2% 2000/-
5 and NIL NIL NIL NIL