LIC’s first online plan “Jeevan Akshay VI”-Review

Recently LIC launched it’s first online policy with launching new version of pension plan “Jeevan Akshay VI”. Let us look at it’s features and how it is beneficial.

Before that I want to give you small glimpse on few terminologies used in pension plans.

Annuity-In simple term you can say it as a Pension, where you will get regular income till the specified period or conditions. Two types of annuity are their 1) Immediate Annuity-In this case your pension starts immediately. 2) Deferred Annuity-In this case your annuity starts after certain period. (Suppose your current age 40 yrs and if your annuity will start from the age of 60 years).

Jeevan Akshay VI is the immediate annuity plan where you pay lump sum one time to purchase this plan and your annuity starts from next month.

Basic Features

1) Minimum age is 30 years and maximum is 85 years of age.

2) Minimum purchase price is Rs.1,00,000 for off line and Rs.1,50,000 for online purchase. But no maximum limit.

3) This policy does not acquire paid up value.

4) No Surrender Value under this policy.

5) No loan available under this policy.

6) If your purchase price is Rs. 2.50 lakh or more, you will receive higher amount of annuity due to available incentives. In addition of this, for policies sold online, a rebate of 1% by way of increase in the annuity rate shall also be available.

7) Annuity will be payable on monthly, quarterly, half yearly or yearly base according to your choice.

Types of Annuity available

  1. Annuity payable for life at a uniform rate. Under this plan on death of annuitant annuity ceases.
  2. Annuity payable for 5, 10, 15 or 20 years certain and thereafter as long as the annuitant is alive. Under this plan on death of annuitant during the guaranteed period – annuity is paid to the nominee till the end  of the guaranteed period after which the same ceases. But if death occurs after guaranteed period then annuity stops immediately.
  3. Annuity for life with return of purchase price on death of the annuitant. Under this plan on death of annuitant, annuity ceases and the purchase price is paid to the nominee.
  4. Annuity payable for life increasing at a simple rate of 3% p.a. Under this plan on death of annuitant annuity ceases.
  5. Annuity for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant. Under this plan on death of annuitant, annuity ceases and 50% of the annuity is payable to the surviving named spouse during his/her life time. If the spouse predeceases the annuitant, the annuity ceases.
  6. Annuity for life with a provision of 100% of the annuity payable to spouse during his/her lifetime on death of the annuitant. Under this plan on the death of annuitant, annuity ceases and full annuity is payable to the surviving named spouse during his/her life time. If the spouse predeceases the annuitant, the annuity ceases.
  7. Annuity for life with a provision of 100% of the annuity payable to spouse during his/ her life time on death of annuitant. The purchase price will be returned on the death of last survivor. Under this plan on death of annuitant, annuity ceases. Full annuity is payable to the surviving named spouse during his/ her life time and purchase price is paid to the nominee after the death of the spouse. If the spouse predeceases the annuitant, the annuity ceases and purchase price will be paid to the nominee.

How much you get by one time investment of Rs.1,00,000?

Is it worth to invest??

From the above table you notice that persons who are at their younger will receive less annuity than the older. Eventhough this plan provides facility to enter at the age of 30 yrs but when you calculate for purchaser of this annuity as 60 years then it looks bit attractive.  For example if you opt the annuity type 1, age 60 years and investable amount is Rs.25,00,000 then you will receive monthly pension as Rs.19,479 throughout your remaining life span.

Now if we calculate the returns for the annuity type 1st and considers post retirement life as 20 years (means purchaser who is currently at 60 years of age and his life expectancy 20 years from current age means till the age of 80 years) then return on his investment will be around 6.90%. Now let us see the annuity type 4th by using the same annuity purchaser data, where every year your annuity will increase by 3%, then return on your investment will be  7.03%

But remember two things in mind, whatever the annuity you will receive in this plan is taxable as per current tax slabs for individual and it will not support the inflation adjusted returns. Hence if we consider the both factors then it is a big no no…plan. Eventhough from the annuity type 4 we can assume that inflation will be dealt to the some extent, but still if you consider post tax returns then it will definitely eat your annuity returns drastically.

It is really a good plan for investors who want some steady income throughout their remaining life span without bothering about taxation and inflation. Also one more positive point is, if you invest in this plan then you will diminish the interest rate risk. Because instead of investing in this plan, if you invest in monthly income plans, then you are not sure the same interest you will receive after maturity too. But in this plan you no need to bother, because whatever market interest rate,  you receive stable income.

Remember too that, always invest your retirement accumulated corpus into secured products rather than risky products. Because if your age is 60 years then you are not in a position to take the same risk what 30 years of age investor can take by investing in equity oriented schemes. So think twice and decide to proceed further based on your requirement.


  1. sunilsunil says

    what is the service tax we have to pay for a 50 L investment. Tax will deduct by LIC or it will be investor responsibility. annuity 3.6 L per year is under nil tax bracketen. for sr citizen

    pls help and clarify

  2. Nikhil KumarNikhil Kumar says

    Hello Sir,

    My Father Age is 64 and I want approx Rs 4000 monthly for him. So How much I have to invest in plan to get monthly Rs 4000 (Rs 48000 annually). Please let me know and also what happened of money once he is no there to receive

  3. MaheshMahesh says


    Your all post explaining the LIC PLANS are very helpful with the thought coming to Mind that you are genius. but i am bit confused with jeevan akshay with different types of annuties can u pls elaborate and clear the things.



  5. GowindGowind says

    Dear Basu ,


    I would like to invest 2Lk in this plan.I am 30 years Old.I will receive 14,000 per annum.
    If I opt for monthly anniuty then I may receive even less. Let me consider INR.1000 per month as a fixed Income.

    I will opt for 6th plan so that my after my death my wife will also receive the same every month.

    I will move this INR.1000 to some good mutual fund for another 30 years and I may get good returns.

    By spending 2Lacks now ,it may give good returns at my retirement.and also in near future the rate of Interest will also reduce in India like Foreign countries.

    Please suggest me wheather its a good Idea or not. ?


  6. HeerHeer says

    I want to take LIC Jeevan Akshay for my mother(age 57).I want to know if I’ll invest Rs.2,00,000/-(Its for a single time??) and then go for pension for lifetime,then what pension amount my mother will get every month for lifetime??

    Can you please have advice and some sort of calculation for it?

    Kindly let me know,I want to take policy at the earliest.


  7. B JosephB Joseph says

    Sir, You have mentioned that “if the purchase price is Rs. 2.50 lakh or more, you will receive higher amount of annuity due to available incentives”. Could you please let me know the extent of the higher annuity for a Rs 25lac & Rs 50 lac purchase price. Thanks


  9. atishatish says

    hi i wanted to know whether there is any policy in lic where if u give an yearly premium of 48000 for a person of
    50yrs old for a period of 15 yrs then at the complete of 15 yrs the person will get an amount of 1300000 . the SA for the policy is500000.
    reply as early as possible

    • Basavaraj Tonagatti says

      Atish-Seems to be your agent proposed you with these figures right? Just for confirmation you are commenting. Please ask more details from your agent and get back here. We discuss who is correct or whether such plan really exist or not :)

  10. TonyTony says

    Hi Basu,

    Thanks for your time and sharing information. I am aged 44 and want to get retirement benefits from the age of 55 onwards for 20 or 25 Years and in case of my demise wife to get the same for rest of the years, considering inflation and tax benefits. I am an NRI and want to opt for Rs. 30 Lakhs as one time investment. Please advise the best option you would have chosen in the above scenario. Appreciate your time.

    • Basavaraj Tonagatti says

      Tony-If you are considering inflation only then 4th option is better (but I dislike the option of 3% raise as it never be a case in history that our inflation was just 3%). But whatever you receive from this plan will be taxable income as per current laws. So no need to discuss on this. But if you want benefit to your wife also (post your death) then go for 6th option. Instead you can opt for combo of 4th and 6th based on requirement of your wife’s retirement pension.

  11. Rajeev KumarRajeev Kumar says

    Hi ,

    Can we purchase more than 1 for self at different time period So for example

    I purchase one in June for 1 lakh and second in sept for 1 lakh

  12. Mr SinghMr Singh says

    Dear Sir,

    Need your guidance in managing my parents retirement plan. My Dad who is a Govt employee will retire by end of 2016. Currently he has below investments:

    1. Monthly SIP of Rs 2500 – Birla Sunlife – Since last 2 years
    2. EPF Accumulated so far : 17 lk and now has monthly contribution around 3k and increased his VPF to another 5k
    3. LIC Policy : Jeevan Nidhi 6lk SA – All premium paid. which will mature in 2021 (Also taken Loan 4 lk on that plan)
    4. Gratutity : Hoping to get 10lk during retirement.
    5. Taken Health Insurance : for 5 lk from Star Health pays yearly premium of around 20k
    6. He pays for few other LIC policies for mom and himself – annual premium will be around 15-20k

    Mom is houswife. and they have an apartment for which currently 7 lk home loan is pending.

    His monthly salary is around 40k/ month and expense is around 20-25 k / month excluding Home EMI.
    Kindly suggest where and how much he can invest till the retirement and post retirement so that he keep getting his monthly expense of 25-30k from the investment.

    Kindly note: He doesnt have any liability and i will be contributing on their behalf.

    I know email looks like request for Financial services :) but advice will be really helpful.


    • Basavaraj Tonagatti says

      Shekhar-Why can’t you opt for some % to above said plan and rest in Senior Citizen Savings Account? Also what do you mean by “I know email looks like request for Financial services”, can you elaborate more?

  13. Poorvottar Sampark KrantiPoorvottar Sampark Kranti says

    For all those retired or to-be retired employees who wish to recieve guranteed pension,irrespective of which Annuity Scheme you want to choose please positively invest ur 24 lakhs in two products of India Post.
    ->Monthly Income Scheme(max investment Rs 9 Lakh joint scheme)
    ->Senior Citizen Savings Scheme(max investment Rs 15 lakh,interest receivable quarterly)
    These two will combinedly provide u monthly pension of Re 17,800(enough for middle class family) & @ the end of specified tenure you’ll recieve ur amount without any affect which can be re-invested.
    Please note that in case of LIC Jeevan Akshay-VI(considering ur age as 60 yrs) if you want to recieve Rs 17800 pension per month you need to invest Rs 31 lakhs as against 24 lakh in Post Office.
    Please note that backed by Govt of India investments in Post Offices are of the safest form & safer than even State Bank of India & LIC.

    • Basavaraj Tonagatti says

      Poorvottar-Everything seems to be perfect. But what about the inflation? Which option of this plan or your post office schemes will take care of? Also after maturity from MIS or SCSC, is there any guarantee that you receive the same interest rate what you got in past? At least by investing in this product once can get a same amount throughout the period, which is not possible from Post Office Schemes. Also please elaborate more how Post Office is more secured than SBI or LIC (I am not defending either SBI or LIC).

      • Poorvottar Sampark KrantiPoorvottar Sampark Kranti says

        Sir the investment options of Post Offices have been running since British Era(when there were very limited options of investment)..the other day I came across an uploaded image of National Savings Certificate issued in 1889 & even today you consider wide options of investment & go for excellent return as well as safety of ur fund,nothing can beat Public Provident Fund(limited to 15 lac max) & National Savings Certificate(No Upper Limit @ all !!)..Similarly MIS is also an age-old product so in upcoming times we can only expect better interest rates which will support the then-inflation.Have faith on Govt :)

        • Basavaraj Tonagatti says

          Poorvottar-I have few questions, please clarify my doubt :)
          1) Do you choose the product which suites to your need or first you select the company which exist since British era to invest?
          2) You have not replied to the concerns I raised like inflation risk and interest rate risks which MIS and SCSS inherit. Please reply to it.
          3) Also for your information, currently including PPF, NSC or SCSS interest rate changes on yearly base which are linked to Govt Bond yield. Hence an investor who invest in NSC today may not get the same interest rate after one year if he try to invest freshly.


    Dear Basavaraj,

    Thanks for your detail informations.
    I need some advise. I am living in the UK in last 5 years, but may return in couple of years time. Here I have some pension funds, which I can only transfer to some selected Indian funds and will block till my 55 years age(I am 40 now). LIC is one of them. You know the interest rate in the UK is very poor, thus I am thinking to transfer some amount (around 20-25 Lacs). Will it be worthy to select this fund? what interest rate shall I get and how much do I get annually? Will this amount taxable, if yes how much taxh I have to pay etc. Myself and my few friends are thinking this. So it’ll be helpfull for us to take the decision. Thanks for your advise and expertise.

    • Basavaraj TonagattiBasavaraj Tonagatti says

      Indranil-It is good choice what you decided. But in my view considering the post tax returns (yes it is taxable according to one’s income tax) and missing of inflation linked pension may hurt you in future. Please let me know what other selected Indian funds which are eligible to transfer. Then I may review all and let you know.


        So far my information ING is another provider.
        Can you pls give some idea on LIC JEEVAN AKshay option (d)as follows…
        ”Annuity payable for life increasing at a simple rate of 3% P.A”….what is this 3% P.A? Thanks for your help

        • Basavaraj TonagattiBasavaraj Tonagatti says

          Indranil-In this option your pension increase by 3% every year and your pension will be for life time. This option you can say as marginally adjusted to inflation but not fully.

  15. srinivas rao says



    I would like to invest 10 lacs in my fathers name (his DOB 02.04.1942 ie 71years) in option 7 (return of purchase price after his death), i heard there are incentives for investing above 2.5 lacs and 1 % special rebate if opted online … can u please guide me … what amount will my father get PA.


    Srinivas Rao

    • Basavaraj TonagattiBasavaraj Tonagatti says

      Srinivas Rao-Yearly around Rs.72,000 but their may be slight difference as I have not considered the rebates what you are talking about. But please also note that this is taxable income for your father. As you told, better to go online and utilize the incentive of 1%. Let me know if you have still doubts

    • Basavaraj TonagattiBasavaraj Tonagatti says

      M-It is not clear how much is service tax. From LIC site what I found is this info regarding Service Tax “If your purchase price is Rs. 2.50 lakh or more, you will receive higher amount of annuity due to available incentives. In addition of this, for policies sold online, a rebate of 1% by way of increase in the annuity rate shall also be available”. Hence unable to say exactly.

      • MM says

        I checked on other blog and I guess that mention 3.09%.

        Velu can you send me your email id. I can help you. As I know someone who has done similar transfer.

        • Basavaraj TonagattiBasavaraj Tonagatti says

          M-I need authentic info from LIC. If you have that then you are welcome to share the same with me. You can get my mail id from “Contact” page of this blog.

  16. G.velupandianG.velupandian says

    Hi Basu

    I live in Uk and contribute to NHs pensions here. I’m planning to relocate to India in 2015 but NHS pensions allow me to move my pension contributions so far to liC jeevan Akshay 6. Is it good plan . I’m 44,wife is 41. We both have some lumpsum from pension here. If for example I want to invest Rs.10 lakhs from NHs pensions what will be my return monetary in option 1 and what paperwork is needed to move my Uk pensions to this scheme
    Dr. Velu Guruswamy

  17. kannankannan says

    sir, If we put one lakh in FD, we will get minimum 10,000 per year as interest and we will get back the amount after the specified period. But in this policy LIC does pay yearly annuity is very less only after 70 years it is little bit higher. why this difference sir.? That means it is better to invest in FDs rather than go for annuities? please suggest. I am running 50 years now.

  18. balabala says

    Will you please elaborate , that how to invest ,for those retiring , to beat the inflation,decent returns ,without tax deduction @ source since banks are deducting even if form 15 G given,saying IT authorities told to deduct , and get back the amount by filing the returns whatever the meg are amount..Thanks

    • BasuNiveshBasuNivesh says

      Bala-It seems to me that you want all the benefits of the world for your investment :) Please specify whether you are about to retire or you are planning for retirement. If you are planning to retire then let me know your current age and your retirement age.

  19. SubhasisSubhasis says

    Great analysis … Please keep on doing the good work.. I have one query .. if I go for option 3.(Annuity for life with return of purchase price on death of the annuitant) in this policy, will that gurantee me the same annuity amount every year irrespective of the market rate of interest fluctuations?

    • BasuNiveshBasuNivesh says

      Subhasis-Yes the returns will be fixed throughout the period irrespective of interest rate. But think and decide will this offering really fulfill your retirement need?

  20. PiyushPiyush says

    Dear sir, as stated on the LIC site there is 1% incentive for online purchase as well as higher number of annuities on purchase of more than 2.5L.. Does these additional benefits (online purchase of more than 2.5L) make this policy attractive. Can you create a sample table and share it for everyone’s benefit. Thanks – Piyush

    • BasuNiveshBasuNivesh says

      Piyush-Still that one 1% benefit will not make it attractive. But it make sense to older not to younger. Sure, I will try to create a table on this benefit too.

  21. PravinPravin says

    Hi …im panning to go for this plan…would u tell me if i should go for fd’s or this plan and the annual returns in these….

  22. vaishnavi says

    Hi sir,
    I would like to purchase a policy of 3 lakhs for my parents who are aged above 50 years. Could you please let me know the premium i have to pay yearly and also the monthly income my parents would get.

    • BasuNiveshBasuNivesh says

      Vaishnavi-In above table I showed you for the investment of Rs.1,00,000, so can make it 3 times and calculate yourself with which option you want to go. If still find difficulty in understanding then let me know.

  23. balabala says

    If one has to take in to account inflation and taxation, what are the avenues open for those retiring and want to invest in a safe and secure way. Whether in all plans , whether the period over /death . whether the original investment is returnable to the nominee(except those mentioned with return of purchase price) . Increase in annuity 3% means (sl No 3) . whether the amount of inanity sanctioned in the first year increases by 3%. Further if you could put forth a comparison of FD/Annuity with tax implications for various slabs taking in to inflation, a hypothetical case study ,it will be of useful. Thanks for the wonderful educational blog

    • BasuNiveshBasuNivesh says

      Bala-For retirement the major drawback especially in Indian context is not planning in advance. You need to create your retirement corpus in such a way that if you invest in an secured product during your retirement period it takes care of inflation risk and interest rate risk too. Hence eventhough their are currently FDs or such type of pension plans available for retirement investments, if you have created enough corpus which sustains both the risks then you no need to worry.
      Regarding the options of this plan, in some cases you will get the invested corpus back and in some it is not. Yes regarding Sl.No.3 option, every year your payout will increase by 3%. It is not wise to compare FD with annuity, reason is, during the time of retirement one need continues payout from his or her invested corpus which is missing in FD. Hence I dont think it is wise to compare FDs with annuity. Let me know your views too :)

  24. Shashidhara MurthyShashidhara Murthy says

    Shashidhara Murthy…
    Thanks for the valuable information. I want to invest about Rs. 5Lakh under this plan, Type – I. I am aged 56 years and want to invest through online. I am an IT assesse. Do you recommend this for me? If so, how I should proceed with it?

    • BasuNiveshBasuNivesh says

      Shashidhara Murthy-Thanks for your comment. Before investing consider these points-your expenses (how much % of your expenses depend on this plan), inflation and taxation. If you consider all the three said points then this plan is not suitable for you. Because your returns from this plan is constant throughout your life span. So inflation is the major part which will eat your returns from this plan. Second thing is taxation. Whatever you receive from this plan is taxable. Hence post tax returns is very less. Considering inflation and taxation means this plan is not worth to invest for.
      The same thing I expressed in above article. If you are not bothering about inflation and taxation, and looking for some constant income stream then go for this plan. Otherwise I will not recommend you to invest in such plans.

    • BasuNiveshBasuNivesh says

      Mukesh-I mentioned the same thing above. If you go online then you will get 1% more annuity than offline mode. Also for online mode minimum purchase is Rs.1,50,000 and for offline mode minimum purchase is Rs.1,00,000. These two are the only differences.

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