Functions of ASP

The PFRDA empanels IRDA-registered Indian Life Insurance companies to manage annuity funds and payment of pension after you attain the age of 60 years or superannuation and take an exit.

In simple terms, annuity refers to the periodical payments that you receive from the Annuity Service Providers (ASPs) upon your exit from the NPS scheme.

It's important to note that as an NPS subscriber, you have the flexibility to choose the ASP and annuity plan that suits your retirement needs and preferences. You can also opt for a lump sum withdrawal of your accumulated NPS corpus and invest the remaining amount in an annuity plan to receive regular income during your retirement years.

Functions of ASP

a) To provide annuity payments to the subscribers at the time of exit from the National Pension System (NPS).

b) To provide minimum immediate annuity variants options as required by the Authority and to be able to provide any new variant as required by the Authority from time to time in the interest of subscribers in conformity with the Insurance Act, 1938 and the Insurance Regulatory and Development Authority Act, 1999, and the rules, regulations and guidelines made thereunder.

c) To provide monthly or any other periodical annuity payment to the subscriber for the annuity contract purchased by the subscriber under the NPS.

d) To handle the grievances and issues related to or arising out of the entering into the annuity contract with the subscribers under the NPS.

For detailed functions / duties and responsibilities of empaneled ASP, please refer to PFRDA (Exits and Withdrawal under National Pension System) Regulations 2015.

Types of Annuity Investment Plans

Annuity schemes under the National Pension System (NPS) are offered by Annuity Service Providers (ASPs) that are regulated by the Insurance Regulatory and Development Authority of India (IRDAI) and are empaneled with the Pension Fund Regulatory and Development Authority (PFRDA).

It is crucial for NPS subscribers to understand the different types of annuity options before making a purchase decision. Annuities provide a regular monthly pension after retirement, ensuring financial security throughout life.

Below are the commonly available immediate annuity options:

• Annuity for Life:

This option pays a fixed annuity to the subscriber for life. After the death of the annuitant, the policy terminates, and no further benefits are payable.

• Annuity for Life with Return of Purchase Price (RoP) on Death:

This annuity option pays a regular pension for life. Upon the death of the annuitant, the purchase price is returned to the nominee, after which the policy terminates.

• Annuity for Life with 100% Annuity Payable to Spouse on Death of Annuitant:

In this option, annuity payments continue as long as either the annuitant or the spouse is alive. Upon the death of the primary annuitant, the spouse receives 100% of the annuity for life. Once both passes away, the annuity payments cease.

• Annuity for Life with 100% Annuity Payable to Spouse on Death of Annuitant with RoP

This annuity is payable as long as at least one of the annuitants (subscriber or spouse) is alive. After both have passed away, 100% of the purchase price is returned to the nominee.

• NPS – Family Income Option

This is a unique annuity plan where annuity payments are made to the subscriber and their spouse during their lifetimes. After their demise, the annuity continues to the subscriber’s mother, and subsequently to the father. Upon the death of the last surviving family member, the purchase price is refunded to the nominee or legal heir.
 

Important Notes:

• Age criteria, annuity premium rates, and monthly/periodic pension amounts may vary across Annuity Service Providers (ASPs).
• Subscribers are advised to compare annuity rates and terms offered by different ASPs before making a decision.

View Exit and Withdrawals under the NPS Regulations

Important FAQs

For detailed FAQs, please visit