PFRDA: Shriram Life becomes the annuity service provider for the PFRDA pension plan

The Pension Funds Regulatory and Development Authority (PFRDA) has incorporated Shriram Life Insurance Company (SLIC) as the annuity service provider for the NPS scheme. The incorporation will help the insurance company manage the annuity component of the maturity product under the National Pension System (NPS), SLIC said in a statement Wednesday.

The life insurer said its incorporation as an annuity service provider by the pension fund regulator will help attract more NPS subscribers to its annuity scheme.

“Shriram Life offers an immediate annuity product at a great price and a robust fund management framework. With these, we are preparing to make the most of this new opportunity.

“It also gives us another opportunity to provide holistic insurance solutions to our clients,” said Casparus Kromhout, MD and CEO of Shriram Life Insurance Company.

With nearly 1.5 crore subscribers under the NPS and with an AUM of over Rs 7 lakh crore in the country, the incorporation of SLIC as an ASP will help it leverage 40% of the amount of l maturity of the NPS, which will be open for investment in annuity plans, it said.

With its Immediate Annuity Plus Plan, SLIC has options for NPS subscribers that provide flexible options for retirees to continue their lives under the same financial conditions as before.

Annuity premium mobilization in India is more than Rs 25,000 crore per annum.

As NPS subscriptions mature and subscribers retire, this opportunity will grow further.

It will also allow customers to choose from an array of insurance providers who offer rewarding annuity plans to suit their needs and lifestyle.

The Annuity Service Provider is an insurance company registered with the IRDA and incorporated by the PFRDA to provide annuity services to NPS subscribers upon exiting the system.

ASPs are responsible for managing the funds (allocated to purchase the annuity) and paying the pension after the subscriber reaches age 60.

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