New Pension Plus 867
LIC New Pension Plus 867 is the third ULIP scheme launched by LIC Of India in between year 2020 to 2022. LIC has launched this plan from 5th September, 2022. LIC’s New Pension Plus 867 is a Single Premium and regular premium, Non-Participating, Unit Linked, Individual Life Insurance plan which offers insurance cum investment during the term of the policy.
Introduction – Why Retirement Planning Matters for Indians
India is transforming rapidly. From gig economy jobs to early retirements, financial independence has become a priority for millennials and Gen Z. Yet, retirement planning is often overlooked.
Here’s the harsh truth:
- Rising inflation (6-7% yearly) reduces purchasing power.
- Medical costs are skyrocketing.
- Dependence on children for old-age support is decreasing.
This is why pension products like LIC New Pension Plus 867 are gaining importance.
What is LIC New Pension Plus Plan 867?
LIC New Pension Plus Plan (Plan No. 867, UIN: 512L344V02) is a Unit Linked Pension Plan (ULIP) designed for retirement planning.
👉 Unlike traditional LIC endowment or money-back plans, this is a market-linked product, meaning:
- You invest premiums regularly or in one go (Single Premium option).
- Funds are invested in LIC-managed Equity, Debt, Balanced, and Secured options.
- On retirement, you can withdraw a part of the corpus and convert the rest into annuity (regular pension).
It is not just an investment plan – it’s your financial security blanket post-retirement.
Key Features of LIC New Pension Plus 867
| Feature | Details |
|---|---|
| Plan Type | ULIP Pension Plan |
| Plan Number | 867 |
| Entry Age | 25 to 75 years |
| Maturity Age | Up to 85 years |
| Policy Term | 10 – 42 years |
| Premium Payment | Single or Regular (Monthly/Quarterly/Half-Yearly/Yearly) |
| Minimum Premium | ₹3,000/month, ₹9,000/quarter, ₹18,000/half-year, ₹30,000/year |
| Maximum Premium | No limit |
| Fund Options | Pension Bond, Pension Secured, Pension Balanced, Pension Growth |
| Partial Withdrawal | Allowed after 5 years |
| Death Benefit | Fund Value or 105% of premiums paid, whichever is higher |
| Vesting Benefit | 1/3rd as lump sum + 2/3rd for annuity (as per IRDA rules) |
| Loan Facility | Not available |
How LIC New Pension Plus Works
- Choose premium & policy term (e.g., ₹50,000 yearly for 25 years).
- LIC deducts charges (fund management, policy admin, mortality).
- Remaining money is invested in pension funds.
- On retirement/vesting age:
- Withdraw up to 60% corpus (tax rules apply).
- Use the rest to buy an annuity plan for regular lifelong pension.
- On death, nominee gets higher of fund value or 105% premiums paid.
Fund Options in LIC Pension Plus 867
| Fund Type | Risk Level | Investment Mix | Ideal For |
|---|---|---|---|
| Pension Bond Fund | Low | Govt. Securities, Bonds | Conservative investors |
| Pension Secured Fund | Low-Medium | Debt + Limited Equity | Safe wealth growth |
| Pension Balanced Fund | Medium | 40% Equity + 60% Debt | Moderate investors |
| Pension Growth Fund | High | Equity-dominated | Aggressive, long-term investors |
👉 Pro Tip: Choose Growth Fund if you are in your 20s–30s (long horizon). Shift to Secured/Bond Fund closer to retirement.
Illustration Example – How Your Retirement Corpus Grows
Example 1: Young Investor (Ravi, Age 30)
- Premium: ₹1,00,000 yearly
- Policy Term: 30 years
- Fund: Pension Growth
| Assumed Return | Maturity Corpus | Monthly Pension (Annuity @6%) |
|---|---|---|
| 6% CAGR | ₹85 Lakhs | ₹42,000/month |
| 8% CAGR | ₹1.2 Crore | ₹60,000/month |
Example 2: Mid-Age Investor (Meera, Age 40)
- Premium: ₹2,00,000 yearly
- Policy Term: 20 years
- Fund: Pension Balanced
| Assumed Return | Maturity Corpus | Monthly Pension |
|---|---|---|
| 6% CAGR | ₹74 Lakhs | ₹37,000/month |
| 8% CAGR | ₹1.05 Crore | ₹52,000/month |
Example 3: Late Starter (Suresh, Age 50)
- Premium: ₹3,00,000 yearly
- Policy Term: 15 years
- Fund: Pension Secured
| Assumed Return | Maturity Corpus | Monthly Pension |
|---|---|---|
| 6% CAGR | ₹70 Lakhs | ₹35,000/month |
| 8% CAGR | ₹95 Lakhs | ₹47,000/month |
Premium Chart – LIC Pension Plus Illustration
| Age | Premium | Term | Fund | Est. Corpus @6% | Est. Corpus @8% | Est. Monthly Pension |
|---|---|---|---|---|---|---|
| 25 | ₹50,000 | 35 yrs | Growth | ₹75 Lakhs | ₹1.2 Cr | ₹60K/month |
| 30 | ₹1 Lakh | 30 yrs | Growth | ₹85 Lakhs | ₹1.2 Cr | ₹60K/month |
| 40 | ₹2 Lakh | 20 yrs | Balanced | ₹74 Lakhs | ₹1.05 Cr | ₹52K/month |
| 50 | ₹3 Lakh | 15 yrs | Secured | ₹70 Lakhs | ₹95 Lakhs | ₹47K/month |
(Figures are illustrative; actual returns vary as per market)
Benefits of LIC New Pension Plus Plan 867
✅ Retirement Security
Guaranteed lifelong pension (via annuity).
✅ Market-Linked Growth
Better chance of beating inflation.
✅ Flexibility in Fund Choice
Switch between growth, balanced, secured, and bond funds.
✅ Partial Withdrawals
Liquidity after 5 years.
✅ Tax Benefits
Premiums eligible under Section 80C.
Analyst Opinions – Expert Insights
- Financial Planners: “LIC Pension Plus 867 bridges the gap between traditional LIC policies and market-based wealth creation. Ideal for disciplined savers.”
- Investment Analysts: “Returns are competitive compared to NPS (National Pension System), but charges may reduce net yield.”
- Retirement Consultants: “Best for individuals who want both LIC’s trust + pension security.”
Investor Scenarios
Scenario 1: Corporate Professional (Age 28)
Arun invests ₹50,000/year for 35 years → ₹1.2 Cr corpus. Post-retirement, he enjoys ₹60,000/month pension.
Scenario 2: Self-Employed Businesswoman (Age 38)
Neha invests ₹2 Lakhs/year for 22 years → ₹95 Lakhs corpus. She secures ₹48,000/month pension after retirement.
Scenario 3: NRI Investor (Age 35)
Sanjay invests ₹3 Lakhs/year for 25 years. With 8% returns, corpus reaches ₹2 Crores, ensuring ₹1 Lakh+ pension monthly in India.
LIC New Pension Plus vs Other Retirement Options
| Feature | LIC Pension Plus 867 | NPS | PPF |
|---|---|---|---|
| Returns | Market-linked | Market-linked | Fixed 7-7.5% |
| Liquidity | After 5 years | Partial after 10 years | After 15 years |
| Annuity Option | Mandatory | Mandatory | No |
| Tax Benefit | 80C, 10(10D) | 80C, 80CCD | 80C |
| Best For | LIC loyalists, disciplined investors | Low-cost retirement | Safe, conservative savers |
Pros & Cons of LIC Pension Plus 867
✅ Advantages
- LIC’s brand trust
- Dual benefit (wealth + pension)
- Flexible fund options
- Market-linked growth
- Retirement safety
❌ Disadvantages
- No guaranteed return
- Mandatory annuity purchase reduces liquidity
- Charges can impact long-term returns
Tips to Maximize Returns
- Start early (20s–30s = maximum compounding).
- Choose Growth Fund initially, shift to Secured/Bond near retirement.
- Invest annually instead of monthly to reduce charges.
- Combine with separate term insurance for bigger cover.
FAQs – LIC New Pension Plus 867
Q1. Is LIC Pension Plus 867 guaranteed?
👉 No, returns are market-linked.
Q2. Can I withdraw fully on maturity?
👉 No, as per IRDA, you can withdraw 60%; rest must buy annuity.
Q3. What is the minimum premium?
👉 ₹3,000/month or ₹30,000/year.
Q4. Can NRIs buy this plan?
👉 Yes, NRIs are eligible.
Q5. What happens if I stop paying?
👉 Policy acquires paid-up value; benefits reduce.
Q6. How is pension taxed?
👉 Annuity income is taxable as per slab.
Q7. Which fund is best?
👉 Growth Fund for young investors; Secured/Bond for nearing retirement.
Final Verdict – Should You Invest?
LIC New Pension Plus 867 is best for:
- Young professionals planning retirement corpus.
- NRIs looking for India-based pension.
- Middle-aged investors seeking wealth + lifelong annuity.
👉 Avoid if you want guaranteed returns only. In that case, choose LIC Jeevan Shanti (single premium annuity).
Smart Strategy:
- Use LIC Pension Plus for retirement corpus.
- Pair with LIC Jeevan Amar (term plan) for protection.
- Diversify with NPS + PPF for balanced retirement planning.
