Q-1 Can I make an early withdrawal from my pension plan?
Ans- Early withdrawal from retirement plans may be allowed. However, there are certain government regulations applicable on early withdrawal from retirement policies. Do check with your insurer regarding early withdrawals before you invest in a certain plan.
Q-2 What is Death Benefit under a Pension Plan?
Ans- In a pension plan, a death benefit is defined as the amount which will be paid on the passing away of the insured to the beneficiary of the insured, named in the policy.
Q-3 Are Pension Plans tax deductible in India?
Ans- Yes, Pension Plans do provide tax benefits to the policyholder. Under section 80C of the Income Tax Act, premiums which you pay towards your Pension Plan will be subject to deduction up to the maximum amount of ₹10,000 on your taxable income.
Q-4 Can I apply for a Pension Plan online?
Ans- Yes, most insurance providers have comprehensive websites which not only allow for viewing of different pension plans but also allow them to apply for a plan of their choice online.
Q-5 Can I make the premium payment for my Pension Plans online?
Ans- Yes, online payment of premium can be done very easily. Most insurers do have a secure payment system in place to enable policyholders to pay their premiums online in a timely manner, without having to visit the branch office. Payment can be made through debit card, credit card or net banking facilities.
Q-6 How can you check the status of a pension plan online?
Ans- To check the status of the pension plan online you need to log in to your account on the insurance company’s website with the designated user id and password, after which all the relevant data of your plan will be displayed.
Q-7 What is the process of renewal of a pension plan online?
Ans- To renew the pension plan online you need to log in to your account on the insurance company’s website with the designated user id and password and then you need to select the option of online renewal. Now you have to pay the premium required to renew the plan through debit card, credit card or net banking facilities.
Q-8 What is the process to cancel a pension plan?
Ans- In order to cancel the pension plan you need to fill the required form and submit it to the insurance company along with the surrender charges as mentioned in the policy. If a new policy is taken, then a period of 15 days is allowed to surrender the policy, if it is necessary.
Q-9 Are pension plans from insurance companies subjected to Required Minimum Distributions (RMDs) in India?
Ans- No, pension plans from insurance companies are not subjected to Required Minimum Distributions (RMDs). The RMD rules apply to all employer-sponsored retirement plans, including profit-sharing plans, 401(k) plans, 403(b) plans, and 457(b) plans, traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs etc.