LIC Jeevan Akshay-VII Plan (857) Calculator

LIC Jeevan Akshay-VII Plan (857) Calculator

What this calculator does

LIC's Jeevan Akshay-VII (Plan 857) is an immediate annuity plan - you pay a single lump sum (the purchase price) once, and in return LIC pays you a regular pension (annuity) for the rest of your life, starting almost immediately. Unlike a savings or endowment plan, there is no accumulation phase: the payout begins as soon as you buy the policy, based on the annuity option and payment frequency you choose.

The plan offers several annuity options that trade off monthly income against what happens to your capital and your dependents after you're gone - from a pure "life annuity" that pays the highest rate but ends at death, to options that guarantee payments for a minimum term, to options that return your full purchase price to your nominee, to joint-life options that continue paying your spouse after you pass.

This calculator gives you an indicative estimate of:

• the annual pension and per-installment pension your purchase price would buy
• the effective annuity rate (pension as a % of purchase price) for your chosen option
• a comparison across payment frequencies (yearly, half-yearly, quarterly, monthly)

based on your current age, purchase price, chosen annuity option, and (for joint-life options) your spouse's/joint annuitant's age.

Formula Used

The annuity rate LIC offers rises with age (since the expected payout period shortens) and varies by annuity option (options that return capital or guarantee payments cost the insurer more, so they pay a lower rate) and by payment frequency (more frequent installments carry a small rebate).

The base annual rate is interpolated from age-anchored reference points:

$$BaseRate(age) = \text{interpolate}\big((30, 5.2\%), (40, 5.6\%), (50, 6.1\%), (60, 6.8\%), (70, 7.8\%), (80, 9.2\%), (85, 10.2\%)\big)$$

For joint-life options, the base rate uses the younger of the two annuitants' ages, since payments continue until the second death:

$$EffectiveAge = \min(YourAge, JointAnnuitantAge)$$

The base rate is then scaled by an option factor (illustrative, reflecting each option's relative cost to the insurer) and a payment-mode factor:

$$AnnualPension = PurchasePrice \times BaseRate(EffectiveAge) \times OptionFactor \times ModeFactor$$ $$InstallmentAmount = \frac{AnnualPension}{InstallmentsPerYear}$$

Option factors used (relative to the pure life annuity, which pays the most since nothing is returned and no minimum term is guaranteed):

Annuity Option	Factor
Life annuity (no return of purchase price)	1.00
Life annuity guaranteed for 5 years	0.99
Life annuity guaranteed for 10 years	0.965
Life annuity guaranteed for 15 years	0.94
Life annuity guaranteed for 20 years	0.905
Life annuity with return of purchase price	0.74
Joint life last survivor annuity (no return)	0.93
Joint life last survivor annuity with return of purchase price	0.68

Payment-mode factors: yearly 1.00, half-yearly 0.995, quarterly 0.99, monthly 0.98.

Note: these rates are illustrative approximations for planning purposes, not LIC's official rate card, which varies by IRDAI-approved tables and can change over time. Always confirm exact figures with LIC or an authorized agent before purchasing a policy.

How to Use

1. Enter your current age.
2. Enter the purchase price (the lump sum you plan to invest) - minimum ₹1,00,000.
3. Choose an annuity option from the dropdown.
4. If you choose a joint-life option, enter the age of your spouse/joint annuitant.
5. Choose how often you want the pension paid - yearly, half-yearly, quarterly, or monthly.
6. Click Calculate Pension to see your estimated annual and per-installment pension, the effective annuity rate, and a comparison across payment frequencies.

Worked Example

Suppose you are 60 years old, invest a purchase price of ₹20,00,000, choose the Life annuity with return of purchase price option, and want the pension paid monthly.

• BaseRate(60) = 6.8%
• OptionFactor (Life with ROP) = 0.74
• ModeFactor (monthly) = 0.98

$$AnnualPension = 20{,}00{,}000 \times 0.068 \times 0.74 \times 0.98 \approx 98{,}500$$ $$MonthlyInstallment = \frac{98{,}500}{12} \approx 8{,}208$$

So this purchase price would fetch roughly ₹98,500 a year, or about ₹8,208 a month, for life - with the full ₹20,00,000 purchase price returned to your nominee after your lifetime.