The Pension Fund Regulatory Development Authority has appointed Shriram Life Insurance Company (SLIC) as an Annuity Service Provider (PFRDA). The appointment will assist the insurance company in managing the annuity component of the National Pension System’s maturity proceeds (NPS).
The PFRDA certification will assist SLIC in gaining more NPS customers for their annuity plan. With almost 1.5 crore NPS members and an AUM of more than Rs 7 lakh crores throughout the country, SLIC’s appointment as ASP will enable it to mobilise 40 per cent of the NPS maturity amount, which will be available for investment in annuity schemes.
SLIC’s annuity plan, Immediate Annuity Plus, contains alternatives for NPS subscribers that provide various options for retirees to continue living in the same financial circumstances as before.
In India, annuity premiums are mobilised at a rate of more than Rs 25,000 crores each year. This possibility will grow when NPS subscriptions mature and subscribers retire. Customers will also be able to select from a variety of insurance providers who offer rewarding annuity programmes tailored to their specific needs and lifestyle.
Speaking on the PFRDA certification, Casparus Kromhout, MD & CEO, Shriram Life Insurance Company said, “Shriram Life has a well-priced immediate annuity product and a robust fund management framework. With these, we are gearing up to make the best use of this new opportunity. This also provides us with another avenue to provide holistic insurance solutions for our customers.”
The Annuity Service Provider is an IRDA-registered insurance business that has been appointed by PFRDA to provide Annuity Services to NPS subscribers upon their leave from the system. After a subscriber reaches the age of 60, ASPs will be responsible for managing the money (assigned for purchasing annuities) and paying the pension.