CIRCULAR
PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

PFRDA/ 2013/14/ PDEX /9 September 17, 2013

To,
All Govt depts./PAO’s/DDO/ POP’s, CRA & other stakeholders

Dear Sir/ Madam,
Sub: Option to defer Annuity purchase under NPS at the time of exit

As per the Exit guidelines of PFRDA for National Pension System (NPS) subscribers, a subscriber on attaining the Normal Retirement Age (applicable to Govt. sector subscribers) or upon attaining 60 years – is required to compulsorily annuitize at least 40% of your pension wealth and the remaining 60% can be withdrawn as a lump sum.

Also, a subscriber wishing to exit from NPS before the normal retirement age or before attainment of 60 years is allowed to exit subject to the condition that a minimum of 80% of accumulated pension wealth needs to be mandatorily utilized for purchase of annuity that provides for the monthly pension to the subscriber.

Presently, withdrawal of permissible lump sum withdrawal (60%) upon exit can be deferred by the subscriber to a later date but not beyond attaining 70 years of age. This is to take care of the reasons like unfavorable Market conditions or there being no requirement of the funds at that particular time.

Due to the upheavals in the market conditions including the bond market and the swings in NAV’s of the debt funds including NPS in the recent past, feedback has been received from various stakeholders that the subscribers be given an option to defer or time the annuity purchase (subject to a minimum of 40%/80% of accumulated pension wealth as applicable) akin to the deferment option for the lump sum withdrawal that is permitted currently under NPS.

PFRDA after examining the issued has approved the “Deferment option” for the annuity purchase at the time of exit from NPS with condition that such deferment can be for a maximum period of 3 years. One can initiate the annuity purchase option at any time before lapse of 3 years from the date of such deferment, by giving an application or notice to the Central Record Keeping Agency.

If no such notice is given before the lapse of 3 years from such date of deferment, the percentage of accumulated pension wealth as provided by the subscriber in the NPS withdrawal application form (subject to a minimum of 40%/80% of accumulated pension wealth as applicable) for purchase of annuity would be automatically monetized and such amount would not earn any investment income or interest to the subscriber thereafter.

This is for the information of all concerned. The circular has also been placed on PFRDA website at http://www.pfrda.org.in and CRA website at http://www.npscra.nsdl.co.in.

Yours faithfully,
Sd/-
Venkateswarlu Peri
General Manager

Source: www.pfrda.org.in
[http://pfrda.org.in/writereaddata/linkimages/Annuity%20Purchase%20at%20exit2395121277.pdf]

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CIRCULAR

PFRDA/2O13/5/PDEX/4

14th February 2013

To,
All POP’s/ Aggregators/ CRA/ dealing offices of Central & State Governments,

Subject: Default ASP and Annuity Scheme for subscribers exiting from NPS and Seeking withdrawal of Accumulated Pension Wealth.

PFRDA has empanelled seven Annuity Service Providers (ASP’s) for providing annuity services to NPS subscribers. As per current National Pension System (NPS) exit norms,the subscriber is mandatorily required to select one of the empanelled ASP’s along with an Annuity scheme from those offered by the chosen ASP at the time of exiting from NPS and seeking withdrawal of accumulated pension wealth (for reasons other than death of the subscriber).

Based on the feedback received from stakeholders seeking provision of a default option to be exercised by the subscriber at the time of selection of the ASP and choosing of an annuity scheme, PFRDA has examined the matter and decided to assist the subscriber by providing a default option.

After examining the various options provided by the different ASPs, it has been decided to provide for a default ASP and annuity scheme as below:
1. Default Annuity Service Provider — Life Insurance Corporation of India.

2. Default Annuity Scheme – Annuity for life with a provision of 100% of the annuity payable to spouse during his/her life on death of annuitant’ and Under this option, payment of monthly annuity would cease once the annuitant and the spouse die or after death of the annuitant if the spouse pre-deceases the annuitant, withoutany return of purchase price.

3. However, where the corpus is not adequate to buy the default annuity variant and from the default ASP, the subscriber has to compulsorily choose an ASP who offers an annuity at the available corpus in the account of the subscriber.

Also, it may be noted that this default option is being purely provided in the subscribers’ interest and to avoid any delay in claim processing and is not with a view to endorse/promote any particular ASP or annuity variant being offered by the ASP.

The default ASP and the default annuity scheme as above would be applicable for all variants of NPS i.e. Government Sector, Swavalamban and those accounts under NPS lite platform not able to meet the compulsory contribution under Swavalamban scheme, Corporate and All Citizen model.

This is for the information of all concerned. The circular has also been placed on PFRDA website at http://www.pfrda.org.in and CRA website at http://www.npscra.nsdl.co.in.

Yours Faithfully.,
Sd/-
Venkateswarlu Peri
General Manager

Source: www.pfrda.org.in

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PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

Cir no: PFRDA/ 2013/2/ PDEX / 2
SL-6

Subject: Empanelment of Annuity Service Providers (ASPs) under National Pension System for providing annuity services

PFRDA has issued necessary instructions to CRA with respect to the Empanelment of Annuity Service Providers (ASPs) under National Pension System for providing annuity services. The said information is being re-iterated hereunder for the information of all stakeholders for a better appreciation of the matter.

Following seven Annuity Service Providers (ASPs) have been empanelled for the purpose.
1. Life Insurance Corporation of India
2. SBI Life Insurance Co. Ltd.
3. ICICI Prudential Life Insurance Co. Ltd.
4. Bajaj Allianz Life Insurance Co. Ltd.
5. Star Union Dai-ichi Insurance Co. Ltd.
6. Reliance Life Insurance Co. Ltd.
7. HDFC Standard Life Insurance Co. Ltd.

The companies would be offering their approved annuity products to NPS subscribers and would also designing products suiting our requirements.

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