National Pension System (NPS) rule change: How pensioners will profit
2 min read
From now on, the National Pension System (NPS) pensioners don’t should fill any separate kind to purchase annuity from NPS proceeds on the time of retirement. Insurance Regulatory and Development Authority of India (Irdai) has mentioned that it has relaxed the requirement for a similar and it’s aimed toward offering ease of doing enterprise in insurance coverage trade for defense of pursuits of policyholders.
“In this direction, to bring ease of living for senior citizens, Irdai has relaxed the requirement of submitting separate proposal form for taking the immediate annuity products from proceeds of National Pension Scheme (NPS),” Irdai mentioned in a round.
At current, NPS retirees should submit an exit kind to PFRDA and a proposal kind to insurers on the time of superannuation.
“The Exit Form submitted by NPS retiree must be considered as the proposal form, for offering the immediate annuity product by the insurance companies,” IRDAI said in its round dated September 13, 2022.
The round comes into power with instant impact, Irdai mentioned.
Submission of life-certificate digitally
Insurance regulator has requested insurers to undertake Aadhaar-based authentication for verification of life certificates comparable to Jeevan Pramaan, a authorities initiative on biometric-enabled digital service.
What does it imply for pensioners ? Will senior residents benfit?
Pensioners will not have to fill a separate proposal kind to determine on the annuity after exiting the pension corpus.
According to trade specialists this can profit senior citizen NPS subscribers.
Who supplies annuities to NPS subscribers?
As per the norms of PFRDA, no less than 40 per cent of the accrued pension wealth of a subscriber needs to be utilised for buy of annuity offering for month-to-month pension to the subscriber and the steadiness is paid as lump sum.
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