Letter addressed to FINANCE MINISTER BY OUR PRESIDENT MR.H.M.JAIN

20-08-2014

To

Shri. Arun Jaitley

Union Minister for Finance & Defence

Govt. of India, New Delhi

Hon’ble Sir,

Re. :- Varishtha Pension Yojna

We have come across an advertisement issued by the LIC announcing the

prelaunch of Varishtha Pension Yojna for the period 15th Aug. 2014 to 14th Aug. 2015,

which in the new package announces 9% effective yield per annum for monthly pension

(which is equivalent to 9.38 per annum)

While we are happy that the government is committed to the welfare of the senior

citizens of the country, I recall that even the earlier similar scheme which was launched

in the Mumbai in Jan. 2003 in the presence of Shri. Atal Bihari Vajpayee, former Prime

Minister of India though physically at Delhi with great fanfare it was hailed as a great

breakthrough in terms of benefits and interest in comparing better then the prevalent

bank rate. I am constraint to compare the above scheme with the present Varishtha

Bima Yojna and find that the new scheme is certainly very backward step in terms of

benefits and yield to senior citizens.

The needs of senior citizens and pensioner are a far wider concept today

particularly in view of the emerging trends in pensioner products since there are vastly

changed positive announcements being regularly made by the present government. As

far as LIC is concern there level of servicing is far better than the similar products being

sold by private insurers. Even the services given by bank cannot be compare with our

servicing. In order to make it attractive the returns should be a minimum of 9.8 to 10 %.

Unless it is done immediately pensioners will not invest their hard earned money.

Besides, No advertisement should be published for this products wasting the public

money they should instead, trained agents which will be more beneficial involving lesser

cost. Similarly there should no hassle at the time of policyholders getting money either

by redemption or exit at present withdrawal is not smooth in LIC of India.

Even a cursory look at the advertisement release by LIC does not give a very

positive picture about assured return or the payment period or at the time of demise of

pensioner when nominee faces all sorts of difficulties. Though it is claimed that this is

government scheme is greatly subsidized with the LIC is the exclusive administrative

but it is likely to flop if view points of agents are not heard and responded immediately.

Yours faithfully

(H. M. JAIN)