Experts in the insurance industry feel that the final pension guidelines by the IRDA are definitely a step in the right direction and provide clarity on pensions as a product category.
The option to extend the accumulation period provided in the guidelines is very good for the policyholders especially if he/she delays his retirement, said Mr Aneesh Khanna, Senior Vice-President, Head - Marketing and Product Management, IDBI Federal Life Insurance.
Also, the option to add life insurance cover as a rider and the assured benefit such as minimum guarantee on premium payable on surrender, death or maturity which assures downside protection are customer-friendly features, said Mr Rituraj Bhattacharjee, Head, Product Development and Market Management, Bajaj Allianz Life Insurance.
Unit-linked plans
However, Mr Khanna feels that the regulator should allow the insurers to offer equity-linked pension plans with no guarantee as it can provide higher returns to policyholders.
Agrees Mr G. N. Agarwal, Chief Actuary, Future Generali Life Insurance, who feels that for unit-linked pension products, insurance companies will be able to invest in only very short term bonds where the returns will be low at a mere 4-5 per cent, which may result in insurers coming out with only one or two products in the pension space.