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1 |
Is the annuity an annuitant receives the same
for both the Annuity for Life option and Annuity for Life with return of Corpus
option? |
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2 |
Is the initial minimum contribution of Rs.
5000/- inclusive of Annual Charge and Management Fee? |
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3 |
Is there any limit on the contribution with
regard to tax benefits? |
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4 |
Suppose an individual pays Rs. 5000 in the
1st year. In the second year, he/she pays Rs.2000/- in the month of January. Then
can he/she pay Rs. 750/- in the month of February or does he/she have to again pay
a minimum of Rs. 2000? |
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5 |
Does flexible mean that an individual can
pay, say, once in three years or at any time during the year? |
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6 |
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7 |
If an individual, after paying a big initial
contribution could not continue there on, will the fund grow as it would with regular
contributions? |
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8 |
Is only the investment in the 80CCC fund guaranteed,
or is the entire accumulation in the IPA (Individual Pension Account) guaranteed? |
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9 |
Can the vesting date be changed more than
once? |
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10 |
Can an individual receive pension immediately
after making a one time first contribution? |
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11 |
Do we have a loan option against the Corpus
accumulated? |
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12 |
When will the interest on IPA be decided? |
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13 |
Can a person put in a one time amount of
say, Rs 10 Lac as a lump sum and not pay further, during deferment period? |
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14 |
Is the 10 % charge levied as part of entry
charge irrespective of the size of the contribution. For example, is the rate the
same for Rs 5000 and Rs 50000? Is it levied on all contributions made in the first
year or is it just on the first contribution? |
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15 |
What is the difference between annuity for
life and annuity for life with return of corpus option?
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16 |
Can the spouse get the lump sum at age 45
if the spouse is less than 45 at the time of death of the annuitant?
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17 |
Is 80CCC applicable even if the income crosses
Rs. 5 Lakhs? |
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18 |
Are subsequent contributions eligible for
80CCC benefit? |
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19 |
Who is the regulator for the pension fund? |
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20 |
If an individual wants to withdraw the plan
before the due date, what benefits would he/she receive and when?
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21 |
What is an annuity?
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22 |
In what way an annuity differs from a life
insurance policy?
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23 |
What are the types of annuity? |
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24 |
Who could go in for the purchase of an annuity?
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The pension amount paid in the case of Annuity for Life option will be higher than
for Annuity for Life with return of Corpus.
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Yes
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The available tax benefits and the conditions may change from time to time.
At present, Under Sec 80CCC of the Income Tax Act, 1961, a deduction from income
for a maximum amount of Rs.10,000 p.a. is allowed for contribution to certain pension
funds.
If this deduction is availed, then rebate under Sec 88 of the said Act would not
be available in relation to such amounts.
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No. Any time the contribution has to be a multiple of Rs.1000 and a minimum of Rs.
2,000. |
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Yes, both are possible. |
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After the death of the insured the policy continues so long as the spouse of the
insured is alive (if named in the policy) and the surviving spouse will have the
options specified in the policy, to exercise. Hence the question of nomination does
not arise if the spouse is named in the policy and is alive at this time. In case
the spouse is not named in the policy or the spouse is not alive on the death of
the annuitant, then the question of making payment to specified nominee arises.
Therefore nominee and spouse are totally different and independent of each other.
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Yes, the fund will continue to grow.
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All the accumulations in the IPA are invested in 80CCC approved fund, which is guaranteed.
Thus the accumulation in IPA is guaranteed. The accumulation in IPA, on the date
of maturity or on the date of death before the maturity, includes (a) the opening
balance in the IPA at the beginning of the financial year; (b) contributions received
during the financial year; (c) any Bonus interest credited by the insurance company
to the Annuitant’s IPA from time to time; (d) deductions on account of charges,
premium on term rider, Management Fee and withdrawals, if any.
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At the request of the Annuitant, the Vesting Date may be deferred up to a maximum
of 5 years or till the Annuitant attains the age of 70 years, which ever date occurs
earlier. Such request for deferment should be made at least 6 months before the
original Vesting Date. No further Contributions can be made during this deferred
period. |
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No. Pension cannot be received immediately after the first contribution. The minimum
deferment period is 5 years. |
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No. |
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At the end of every financial year, the earnings of the fund are calculated and
returns on IPA declared. |
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Yes |
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10% will be charged irrespective of size of contribution and for all contributions
within 12 months from the date of issue of policy. |
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Under annuity for life option, annuity will be paid as long as annuitant is alive
and upon his/her death policy comes to an end and no further payments are made.
In case of annuity for life with return of corpus/purchase price option, annuity
is paid as long as the annuitant is alive, and upon his/her death, the amount applied
for purchase of the annuity will be returned to the named spouse or the nominees
or the legal heirs of the annuitant, as the case may be.
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Only up to 1/3 amount can be commuted, subject to applicable regulations. The balance
amount will be applied for purchase of annuity. |
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Yes. The applicability will however depend on the changes in law.
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Yes |
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At present, it is the IRDA (Insurance Regulatory and Development Authority).
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Policy can be surrendered for cash after completion of 3 years. Surrender value
will be the amount in the IPA less surrender penalty. However, it will not be less
than 60% of the amount in the IPA. |
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Policy can be surrendered for cash after completion of 3 years. Surrender value
will be the amount in the IPA less surrender penalty. However, it will not be less
than 60% of the amount in the IPA. |
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Annuities differ from all other forms of life insurance in one fundamental way -
They do not ordinarily provide any insurance cover but offer a guaranteed income
for a certain period or for life.
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There are two types of Annuities: Immediate annuities and Deferred annuities. Under
Immediate annuities, you start receiving annuity payments as soon as you pay the
premium usually in a lump sum. In the case of Deferred annuities, the payments to
the annuitant start after a certain deferment period. Typically, the annuitant pays
annuity premiums in installments during the deferment period. Generally, premium
payable for an annuity that provides future payments is less than the one that provide
for immediate payments, because the deferment period allows the insurance company
to invest your premiums at a profit, thereby reducing the cost of the annuity to
you. |
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Typically annuities are bought to generate income during ones retired life, which
is why they are also called Pension Plans. Annuities provide a solution to the biggest
financial insecurity of old age after one retires and the income from salary ceases. |
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