5 reasons why LIC International Pension Plan is the best in UAE!

Being able to retire with sufficient wealth and income is one of the most important financial goals of expats in UAE.

To help you achieve this goal; LIC International offers the Deferred Annuity Plan 227 & 228

What is Deferred Annuity?

A Deferred Annuity is a policy where the pension is paid after an agreed period. Such plans have 2 phases;

  1. The investment phase - Purchase / Savings - as a lump sum or as regular premiums for a certain number of years.
  2. The Income phase - Annuity payment - When you start receiving the annuity/pensions.

It is different from an Immediate Annuity Plan, where the pensions start immediately after the purchase of the annuity.

Jeevan Akshay is LIC India's Immediate Annuity plan in Rupee denomination.

It is ideal for;

  • Residents in India because they earn, save and spend in rupees
  • People who are nearing retirement & have accumulated a substantial capital for retirement
  • Are now looking for a regular income to support their retirement needs and lifestyle

The Deferred Annuity Plan from LIC International in US Dollar denomination, is an ideal hedge against falling rupee value. It is more suitable for UAE residents who earn in AED.

Also Read : Why NRI should invest in US Dollar denominated insurance and investments?

Given the young expat population living and working here to earn and save money, this plan is an apt investment.

They can invest their savings in the Deferred Annuity Plan, during their working life and receive a pension when they retire in UAE or any other country.

The Deferred Annuity Plan is a unique proposition from LIC International and the following are the 5 reasons why it is the best pension plan in UAE;

Reason 1: 100% Capital Protection

LIC International Deferred Annuity Plan - 100 Capital Protected.jpgYour premiums invested in the Deferred Annuity Plan are 100% capital protected. In addition to the capital protection; the plan guarantees a face value, which is usually higher than the premiums invested.

Given the fact that the equity and the bond valuations are extremely high, and the higher volatility is expected in the forthcoming years, it makes a lot of sense in diversifying into a plan offering Capital Guarantee.

This plan provides a different dimension to your investment portfolio. It enables you to create an ideal asset allocation mix of Guaranteed Investments, Bonds, Real Estate, Commodities, Mutual Funds and Equities.

Reason 2: Choice of Lump-sum or Annuity on Maturity

The Deferred Annuity Plan on maturity allows you to Commute the corpus(avail a Cash lump sum on Maturity) or a convert the corpus into an annuity / regular pension for life.

Depending on the circumstances and other income generating options available at the time of Maturity you can decide to choose either to commute or avail an Annuity for Life.

In the event of death during the annuity period, the lump sum payable (Commuted Corpus) at the time of maturity will be paid to your nominee

For Eg : If the value of your plan at maturity was $100,000 you can choose to receive $100,000 as cash or you can choose to receive an annual pension of $4,150(approximate) as long as you live.

The in event of death during the annuity period, your nominee will receive $100,000 lump sum.

Reason 3: Portability 

The portability of the plan to India is a useful feature for Non-Resident Indians(NRI) investing in this pension plan.

In the event of repatriation to India, you have an option to transfer this plan to India and purchase an immediate annuity plan from LIC of India.

You must have paid at least 2 years premium into the plan, before transferring it to India.   However, the option of commutation(availing Cash lump-sum) will not be available if the policy is transferred to LIC of India.

Reason 4: Choice of Premium Payment Options

Best Pension PLan in UAE - Choice of Premium Payment Options.jpgThis plan provides you with the following choice of premium payment options;

1. Full Term 

You can choose to pay a premium for the full term of the plan (up to 20 years). For Eg, if you are 40 years old and you want to retire at age 60 you can buy a plan with 20 years premium payment.

At age 60 you can either receive cash lump sum or convert the corpus into an annuity.

2. Limited Term

Continuing with the same example, if you are 40 years old now and you want to retire at age 60, but you are not sure if you can pay premiums for the next 20 years, you can choose the limited term premium payment.

Under this option, you can choose a 5 years premium payment term and defer the annuity until age 60.

After the deferment period(age 60) you can either receive cash lump sum or convert the corpus into an annuity

3. Single Premium

If you already have an accumulated capital, you can invest this capital as a single premium with a deferment period starting from 5 years to 20 years, depending on when you would need your pension to start.

Reason 5: Paid Up Value

Due to unforeseen circumstances, if you are unable to pay premiums after 3 years for Full-term Plans and 2 years for limited term plans, your policy will be converted into a reduced paid-up policy for a reduced pension.

LIC International Pension Plan - Paid Up Value.jpg

For Eg: If you had a limited term plan with a face value of $100,000 and projected pension of $6,000 after 15 years and were unable to pay premiums after 2 years; the plan will be treated as follows;

  • The face value of the plan will reduce to $40,000
  • The projected pension after 15 years will reduce to $2,400

Similarly, if you had a full term plan, you have to pay at least 3 years premium to convert your plan into paid-up mode.


To summarize, The 5 reasons why LIC International Deferred Annuity Plan is the best in UAE are;

  1. 100% Capital Protection
  2. Choice of Lump-sum or Annuity on Maturity
  3. Portability to India
  4. Choice of Premium Payment Options
  5. Paid up Value

To know more about this plan and to explore investment opportunities in this plan or other retirement plans, you can arrange a free consultation with me.

Click Here to Arrange a Free Consultation

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