Bajaj Allianz Launches Life Smart Pension Plan For Retirement Income

Bajaj Allianz Life Insurance on May 16, 2025, announced the launch of a new market-linked pension plan. Named Bajaj Allianz Life Smart Pension, the plan aims to help policyholders build a retirement corpus and provide life-long guaranteed income in the form of pension. The insurer described it as “a unit-linked, non-participating, individual pension plan that empowers customers to take greater control of their retirement planning”.

Objective

Bajaj Allianz Life Insurance said the plan aims to build a retirement corpus for the policyholders and provide them with life-long guaranteed income, thus supporting the policyholder’s retirement goals. It is linked to the Bajaj Allianz Life Nifty 200 Alpha 30 Index Pension Fund, and will invest in high-alpha stocks from the Nifty 200 universe, thus offering high growth potential for financial security.

It added that the pension fund will use Jensen's Alpha, which is a measure of performance over and above market expectations. It analyses 30 stocks with the strongest potential for higher returns to offer best returns to the subscribers of the policy. This strategy will ensure diversified benefits combined with the market linked wealth generation towards creating a retirement corpus, the insurer said in the press release.

“The fund will aim to replicate the performance of benchmark index fund, subject to tracking error,” it said, adding that policyholders can select from five other fund options based on their risk and reward preferences.

Tenure and Vesting Age

The plan has a tenure of 10 years with a vesting age of 45 years and offers tax-free withdrawal of up to 60 per cent of accumulated corpus, loyalty additions for long-term investors, and a vesting booster at the end of the 15th policy year. It also allows customers to defer the vesting date based on their retirement goals.

Key Features:

Here are the key features of the policy

Deferment of Vesting Date – Policyholders will have the flexibility to defer the vesting date based on their retirement goals.

Liquidity – The plan offers flexibility to partially withdraw from one’s retirement corpus in case of major life event or critical illness.

Death Benefit – The plan offers death benefits, however; it shall be the Fund Value, subject to a minimum of 105 per cent of total premiums paid, as on the date of death.

Unlimited Free Switches – Policyholders can enjoy the flexibility to switch between funds at no additional cost to help them adapt to their investment strategy in accordance with the market conditions.

Tax Benefits – Tax benefits may be applicable on premiums paid and benefits received as per the prevailing tax laws.

Tarun Chugh, managing director and CEO, Bajaj Allianz Life Insurance, said in a press release: “Globally, retirees have access to social security as a second income stream, whereas most Indians have just the savings from Provident Fund. Focused retirement planning is still not a priority for a large segment of the population. Our flexible market-linked pension plan will enable individuals who are seeking greater control over their financial security post-retirement. It allows them to invest for the long term, build a robust retirement corpus, and ensure a steady annuity through their golden years.”

He said the product is aimed at meeting the changing needs of the insurer’s customers, so that they can pursue their life goals with confidence, even after retirement.