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Those who are subscribing in New Pension system (NPS) will be aware that Government did not appoint any annuity providers for payment of monthly pension to NPS Subscribers. This worry is over now.
Subscribers to the National Pension System (NPS) will now have a choice of six annuity service providers from whom they can choose their annuity schemes on exit from the NPS on attaining the age of 60.
According to an official release here, the Pension Fund Regulatory and Development Authority (PFRDA) has empanelled six life insurance companies that have been approved by the Insurance and Regulatory Development Authority (IRDA) for providing annuity services to the NPS subscribers.
The six insurance companies selected for providing annuity services are: Life Insurance Corporation of India, SBI Life Insurance Co. Ltd., ICICI Prudential Life Insurance Co. Ltd., Bajaj Allianz Life Insurance Co. Ltd., Star Union Dai-ichi Life Insurance Co. Ltd. and Reliance Life Insurance Co. Ltd.
Under the provisions of the NPS, a maximum of 60 per cent of corpus accumulated at the time of exit — normally on attaining the age of 60 — can be withdrawn.
However, a minimum of 40 per cent corpus has to be utilised for purchasing an annuity from one of the six empanelled annuity service providers.
Subscriber can choose any of the six providers and can also select one of the annuity schemes from amongst those being offered by them.
With this, “the PFRDA has taken an important step towards providing an exit route to the subscribers,” the release said.
Source: Press Information Bureau