LIC New Jeevan Nidhi Review: Plan Discontinued — What Existing Policyholders Should Know

By
Hemant Beniwal
-
37

Last Updated on April 5, 2026 by teamtfl

📢 Editorial Note — April 2026

LIC New Jeevan Nidhi has been discontinued and is no longer available for new subscriptions. This review is retained for the benefit of existing policyholders who hold this plan and need guidance on their options. If you are researching retirement plans to purchase today, please see our guide on Best Retirement Plan Options in India (2026).

This review was originally written when LIC New Jeevan Nidhi launched in early 2013. The plan promised to combine life cover with pension accumulation — and the honest assessment then was the same as it would be now: the returns were not worth the complexity, and the compulsory annuity tie-in created long-term inflexibility.

The plan has since been withdrawn from sale. But thousands of policyholders still hold Jeevan Nidhi policies purchased between 2013 and the withdrawal date. If you’re one of them, this article is for you.

⚡ Quick Answer for Existing Policyholders

If you’re within 7 years of your vesting age: Continue the policy to maturity. Surrender values at this stage rarely make sense.
If you’re 10+ years from vesting: Get your current surrender value, calculate the IRR if you continue, and compare against alternatives. In most cases, the conversation with your advisor will surprise you.
Never stop paying premiums mid-way without checking the paid-up value first — lapsing a policy is usually worse than both surrendering and continuing.

What LIC New Jeevan Nidhi Was

LIC New Jeevan Nidhi was a traditional deferred pension plan — a participating endowment-style plan that accumulated a corpus over the policy term, then mandated conversion of that corpus into an annuity at vesting. The key parameters at the time of launch were: entry age 20-60 years, vesting age 55-65 years, policy terms of 5-35 years, and a minimum Sum Assured of Rs. 10,000 (regular premium) or Rs. 15,000 (single premium).

On vesting, the policyholder received Sum Assured plus Guaranteed Additions (Rs. 50 per thousand Sum Assured, for the first 5 years only) plus any Revisionary Bonus and Final Bonus declared by LIC. This corpus then had to be used to purchase an annuity from LIC itself — a condition that was mandated by IRDAI’s 2012 pension plan guidelines.

The Problem That Was Clear Even in 2013

When this plan launched, the core critique was simple: the projected IRR from the policy illustrations was in the range of 5-6% — at or below inflation, and significantly below what equity mutual funds or even NPS could generate over the same 15-25 year period.

Traditional pension plans compound this problem with two additional layers:

Mortality charge drag: The life cover component of these plans — however small — extracts a mortality charge every year. For a senior executive who already has adequate term insurance, this is a cost with no benefit. Every rupee going to mortality charges reduces the corpus available at vesting.

Compulsory annuity from the same insurer: IRDAI’s 2012 guidelines required that the annuity be purchased from the same company. This removed competitive negotiation from the equation. LIC’s annuity rates at vesting might not be the best in the market — but the policyholder had no choice.

💡 What Has Changed Since 2013

IRDAI has since revised some pension plan norms. One-third of the maturity corpus can now be taken as a tax-free lump sum at vesting — the policyholder need not annuitise everything. Up to one-third lump sum is permitted. This is a meaningful improvement for flexibility, but the core issue — low accumulation phase returns — remains unresolved for traditional pension plans.

If You Hold This Policy: Your Options

Option 1 — Continue to vesting. The cleanest choice if you are within 5-7 years of your vesting date. The corpus has already been accumulating for years. Surrendering now typically yields 30-50% of premiums paid — a significant loss. Continuing ensures you at least receive the Sum Assured, accumulated bonuses, and guaranteed additions in full.

Option 2 — Make it paid-up. If you no longer wish to pay premiums but are many years from vesting, you can convert the policy to paid-up status. The Sum Assured reduces proportionally to premiums paid, but the policy continues and you receive a (reduced) corpus at the original vesting age. No further premium outgo. Compare the projected paid-up value against the surrender value to decide.

Option 3 — Surrender. Only sensible if you are very early in the policy (within 2-3 years of purchase), your surrender value is close to premiums paid (rare), and you have a clearly superior alternative use for the money. The guaranteed surrender value is 30% of all premiums paid — meaning you lose 70% in the early years. Surrender is a last resort, not a default recommendation.

⚠️ Never Lapse This Policy

Letting a life insurance or pension policy lapse by missing premiums — without formally surrendering or making it paid-up — is almost always the worst outcome. The policy lapses with zero or minimal value, and you lose all premiums paid without even getting the surrender value. If you are struggling to pay premiums, call LIC and explore the paid-up option first.

What to Consider for Retirement Planning Going Forward

If you hold a Jeevan Nidhi policy, it likely represents only a portion of your retirement plan. Here’s how to think about what else to build alongside it:

NPS (National Pension System): For equity-linked retirement accumulation with professional fund management, NPS remains the most tax-efficient structured pension product in India. Section 80CCD(1B) gives you an additional Rs. 50,000 deduction beyond Section 80C. The annuity at vesting can be purchased from any IRDAI-approved annuity provider — giving you competitive pricing. NPS does what traditional pension plans were supposed to do, but better.

Equity mutual funds via SIP: For a 15+ year accumulation horizon, a structured SIP in diversified equity funds has historically generated returns well above what any traditional pension plan offers. Combine with a balanced advantage fund as you approach retirement for a smoother glide path.

PPF: Tax-free at 7.1% p.a., full flexibility on withdrawal after 15 years, sovereign guarantee. For the debt portion of a retirement portfolio, PPF is more transparent and predictable than any traditional endowment or pension plan.

Not sure whether to surrender, make paid-up, or continue your Jeevan Nidhi?

A structured review of your existing policies alongside your retirement corpus takes 30 minutes — and usually reveals decisions that can meaningfully improve your retirement outcome.

Talk to a RetireWise Advisor

Frequently Asked Questions

Is LIC New Jeevan Nidhi still available?

No. LIC New Jeevan Nidhi has been discontinued. Existing policies continue with their original terms. No new policies can be purchased.

Should I surrender my LIC New Jeevan Nidhi policy?

Depends on how many years remain to vesting. If you are within 5-7 years of vesting, continue. If you are 10+ years away and the surrender value is close to premiums paid, a detailed comparison with your advisor can help. The guaranteed surrender value is only 30% of premiums — so early surrender is almost always a loss. Paid-up is often a better middle path than surrendering.

What happens at vesting in LIC New Jeevan Nidhi?

You receive Sum Assured plus Guaranteed Additions plus Revisionary and Final Bonus. Up to one-third can be taken as a tax-free lump sum. The remaining corpus must be used to purchase an annuity from LIC. The annuity provides lifelong income.

What are better alternatives for retirement planning?

NPS for structured equity-linked retirement accumulation with additional Section 80CCD(1B) deduction. PPF for tax-free guaranteed debt returns. Equity mutual funds via SIP for long-horizon growth. A combination of all three, structured around your retirement date, typically outperforms any single traditional pension plan.

Traditional pension plans were sold on trust and brand name. The numbers, if you look carefully, rarely justified the investment. LIC’s brand is real. The Jeevan Nidhi’s returns were not.

If you hold it — manage it wisely. Don’t compound the original decision with a worse one.

💬 Your Turn

Do you hold LIC New Jeevan Nidhi? How many years are you from your vesting date? Share below — or ask whether surrender, paid-up, or continuation makes more sense for your specific situation.

This review was originally contributed by Jitendra PS Solanki, CFP in January 2013, and has been updated editorially in April 2026 to reflect the plan’s discontinuation and current guidance for existing policyholders.

37 COMMENTS

  1. Please guide me about NPS and best fund plan for SIP . my target monthly investment is Rs 5000 per month for SIP and same for NPS..

    Regards
    Trilok Pundir

  2. Sir. My reqrmts.are as below.
    1) I am salaried person in Pvt.job&my intake app.4 lacs. likly to increase in future
    2) I am looking for trm ins.with disability rider of monthly income (I am looking for (hdfc trm ins with dis.rdr.)
    3)My goal is for 80-90lacs in25-30yrs.
    4) I am invested 4000 in mf & 5000 in ppf.
    5) what should my invetment & what should my trm.ins.
    6) pls.guide for invst.as well as for trm ins. Thanks
    . Rajender Kumar
    . dob. 9-11-1985
    2) Iwant such type of trm.ins.
    with disability rider of monthly income.(I am looking for hdfc click2 protect with extra income)
    3)

  3. Dear sir,
    I bought this Jeevan Nidhi plan 2 years back with annual premium of 22000. I didn’t know much about this product and after reading your review I am feeling like I was misguided by the LIC agent. My 3rd premium is due on NOV-2017. Could you please suggest if I can get out of the plan now or is there a minimum year I have to continue?
    Thank you sir.

  4. Dear sir,
    I bought this Jeevan Nidhi plan 2 years back with annual premium of 15,000. I didn’t know much about this product and after reading your review I am feeling like I was misguided by the LIC agent. My 3rd premium is due on Aug-16. Could you please suggest if I can get out of the plan now or is there a minimum year I have to continue? Will I get back at least my principal amount? Thank you sir.

  5. Hello Sir,
    In Feb 2011 I took this Jeevan Nidhi(old) policy and I am still continue that by paying 4950 rs Quarterly. After reading your article I understood that its better to invest my hard earned money with some other financial instruments. I took this policy at the age of 26 for 25 years. Please advise me on how to proceed further.

    • Anees,

      Endowment plans have issues with the net returns they offer to the policyholders. If you are looking for investments then choose mutual funds or any other avenue which can offer better returns, For insurance a term insurance can meet the objective of having a higher coverage at lowers cost.

  7. I have nirvana plus _Retirement policy in TATA AIG LIFE.
    On reading the earlier mails l am confused about continuing my pension plan.It’s rs.4,00,000/-policy where I pay rs.15,798 semi annual.I have paid for 9years.I am yet to pay for 11 more years ,when I will be 60years.
    I am a rheumatoid arthritis patient. Kindly guide me with your esteemed suggestions.

    • m.thilakavathy,

      You have already covered almost half of your policy term. At this juncture it will be difficult to discontinue with such policy. In my view you continue with your existing policy. But you should also evaluate your exact requirement. This will tell you if there will be any shortfall. If any cover it up by investing in mutual funds and other avenues. On reaching your retirement you can then choose options to generate monthly income.

      With regards to your illness it wont have impact on your existing life insurance policy.

  8. hi ,Mr. Jitendra,
    i am 39 king in working in private sector , looking for guarranted pension plans in market so that i can get decent pension of 30-40000 at age of 60. i have checked LIC jeevan nidhi ,ICICI,etc. can you tell whether LIC jeevan nidhi is guarranted pension plan i.e annunity @7% ,suppose i buy today ,that i will get at age of 60 or it will depend on the rate prevalent at age of 60.
    also what pension plan should i buy from plans in market.

    • Rakesh,

      Annuity which you will receive at age 60 will depend on the rate prevailing at the point of time. In my view you should focus on accumulation at this stage as the amount of pension you receive will very much depend on what corpus you are able to accumulate. For this you should look at mutual funds, PPF etc. for investing for your retirement corpus. Have a mix of equity and debt as per your risk tolerance so that you are able to generate returns on your investment which can beat inflation.
      Once you reach the desired retirement you can then evaluate options for generating monthly income.

  9. Dear sir

    i’m 30 years old male earn Rs 40000 per month lives in Haldwani (Nainital) need to invest in pension plan for my later years. could you please suggest me which pension plan is best suited for me. i’m little bit confuse between SBI saral pension plan and LIC new jeeven nidhi.

    Thanks
    Varun Kumar

    • Varun,

      Unfortunately pension plans are not attractive enough after IRDA new norms. At present you should focus on accumulation for which mutual funds, PPF are good alternatives. Once you reach the desired retirement you can then choose options for generating monthly income for meeting your need.

  10. Hi… Hemant & Jitendra…

    I like your this post. I regularly advice my client that do not purchase any profite return insurnace policy, instead of this type of policy you may go to buy any term policy and invest rest of funds in PPF, post or go for any bank FD. You must got more return. By all of your article you give good detail idea about this…

    Thanks

  11. Thank you very much for your informative article…

    I am very much interested to know your view about LIC’s Jeevan saral policy. As per their brochure it is showing 10% IRR. It would be helpful for everyone if you could post a review about Jeevan Saral policy in this website.

    • Dear Sher_bin,

      Will look into the product. But prima facie a 10% IRR in a traditional product is difficult to achieve considering the nature of investments and expenses associated with it.

    • Hi Kaushal,

      There is no such best plan. Any product which meet your financial objectives will be the best plan for you. You need t work on your requirement and then analyse how a particular product fair in meeting it. If it doesn’t then good to avoid it.

  13. Thanks for the very informative article Mr. Solanki. I have a couple of queries:

    1) I am 40 and want to have a fixed pension of about rs 60000 per month after reaching 60. Would you advise J/Nidhi or J/Akshay or any other safe investment from the market?

    2) Are these policies market-linked? I do not want to reach a stage wherein after retirement I am left with NIL pension currently I have no pension arrangments).

    Thank you for your time.

    • Dear Mr. Sameer,

      You have still twenty years to go. Any pension you receive from these product will depend on the amount you are able to accumulate.Higher the amount, higher will be the pension. These are immediate annuity products and so there is no accumulation period. Also, these are not market linked but the rate of pension may vary when you actually buy the annuity from the company.
      It is difficult to assume a single product for meeting your retirement needs. you might have to go for combination. At this juncture you should focus on accumulating the surplus because that’s the key for receiving the pension you desire.So work on your existing investments by allocating the required savings in the right assets classes and once you reach your retirement you can then evaluate options for the income you need.

  15. Hi Jitendra,

    Based on my understanding of your review and reader comments, I feel NPS would be good option to think for ones pension as it invests in equity and has the potential to beet the inflation…at least by 2 – 5 %.

    Regards,
    Pavan

    • Hi Pavan,

      Yes, in comparison NPS is much more cost efficient product.However, the commutation at vesting age is still not tax free in this although there is every possibility of government improving upon it.

    • Hi Kalyan,

      After IRDA changes, there are not many now to prepare a list. Moreover, pension products have not been able to meet the expectations.

  17. Hi … thanks Jitendra P.S.Solanki and Hemant Beniwal for your valuable information about new product in pension plan. I am regular reader of tflguide. Its very useful to me to learn new things every day. you are doing a very great job.

    1.Can you review and post some best pension plan available in the market?. Its very useful for less salary holders as well as new readers.

    2.Can i use pension plan as debit side of 25% rest 75% in equlaities(Mutual fund,SIP,EFT Gold etc?.

    3.Can you clarify me , all the product in pension plan will meet inflation rate?.

    • Hi Muhil,

      There are not many pension plans now after change in IRDA regulation. The best product which comes closely for lower salary individuals is NPS. But then it is also targeted at for accumulation for which it has mix of equity & debt.You can create the same discipline through mutual funds like you have mentioned 25:75.Still, automatic asset allocation in NPS works well for people who find it difficult to implement asset allocation strategies and rebalancing.

      So you have options to accumulate for your retirement but the real challenge is post retirement income.Fixed Annuities are not offering those inflation indexed rates and they are taxable to.So one has to look at mix of options where most part is variable. Hopefully for people who have still good enough time to retire, there might be options in future which will provide annuities taking care of the factors I have mentioned.

  18. Hi Hemant/Jitendra,

    Lets say that Jeevan Nidhi has pile of stiffness, and surely after retirment we will be looking for handsome pension(which at least beat the inflation) and not the tension 😉 … Considering some one has already a Term plan and he is a regular investor in Mutual fund , which pension plan(s) you would recommend for your reader ..

    • Hi Satya,

      Unfortunately there is dearth of pension plans now.After IRDA regulations not many companies have come out with such products. But even the products now are not meeting the investors requirement.Hence, they do not come in recommendation list.
      The most viable alternative is what you have highlighted– a term plan for family protection and mutual funds for accumulation. For receiving an annuity the immediate annuity products are there but they too have lower rates and are not indexed to inflation. Include taxation and it is difficult to rely on them.

      With such scenarios one has to look for creating a retirement portfolio from different options which not only provide the desired income but also takes care of inflation and taxability.

  19. Hello Jitendra & Hemant,
    I’ve just invested in the LIC Jeevan anand policy (T/T-149). The term of the policy is 16 years and the maturity amount after 16 years would be around 20 lac (approx.) and life coverage for whole life. If I opt out from the life coverage thing, then an additional 9 lac will be paid by LIC. The policy amount is of 10 Lac. The yearly premium is around 72k for this.
    I would like to know if this is a good investment or there similar investments better than this. I’m more interested in having a lump-sum amount instead of pension.
    Thanks,
    Sandipan.

    • Hi Sandipan,

      In a traditional insurance plan the premium policyholder pays is invested majorly in debt securities after deducting various charges such as agents commissions. The returns generated from this segment forms the basis of bonus declared by the company.

      Now debt segment do not generate higher returns and factor in the charges deducted, the traditional insurance plans end up fetching 5-6 % returns to the investors. Jeevan Anand is also a traditional plans and you should not expect higher returns from this product.The problem here is inflation which is hovering around 7%. So if you do not get returns higher then this then you actually loose money and do not gain.

      Analyse your investments in the same manner. For investments which can negate impact of inflation in the long term and grow your money, equities is the most viable option. You should consider investing through Mutual Funds where you can create a well diversified portfolio.

  20. As of now all private insurance companies are dumping their annuities with LIC once it becomes due. IRDA has mandated that the annuity would be provided only by the accumulator of funds. It would a policy feature of all future annuities.

    • Hi Priya,

      Yes you are right, as per new regulation the company which offers a pension plan will also have to provide the annuity to the policyholders. Previously after accumulation, the companies were giving an option to policyholders to buy annuity from any company.This translated to purchase of immediate annuity products which only LIC had.
      But now one can expect more annuity products even by the private companies. Already, Star Union Daichi and SBI Life has come out with their immediate annuity products.

  21. Thanks Jitendra for contributing this review.
    I expect there will be lot of queries on this post as there is lot of confusion around pension products – due to new IRDA guideline.

    • Thanks Hemant for sharing the review with Tfl readers.

      Yes, there has been lot of frequent changes in Insurance Industry which has actually increased the confusion among the investors.I will be happy to answer readers queries on this issue.

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