Comparison Between LIC Jeevan Akshay VI (189) and Fixed Deposit

LIC Jeevan Akshay VI is an Annuity Immediate Plan by the Life Insurance Corporation of India. This policy can be obtained by compensating a lump sum total. The person gets a specific amount as annuity payment through the life time. It is thus a pension plan for senior citizens and is a good retirement investment plan. There are many choices for the mode and the type of imbursement of allowances which can be decided by the person.

Advantages of LIC Jeevan Akshay VI

Death Benefit

There is no death benefit under this plan and in this it is different from other LIC plans. Once the premium is paid by the customer, he gets a pension. The customer can choose to get payments after his/her death in which case the spouse gets the remaining pensions.

Maturity Benefit

There is no maturity benefit under LIC Jeevan Akshay VI

Rate of Pension

This is decided by the type of annuity selected by the policyholder or the annuitant. There are seven active plans under annuity product. However, if it has been decided once and the one time premium has been paid, there is no way that the plan can be changed as it is a one – time payment and the benefits start immediately.

Profit of Participation

For this, the plan should be qualified and should bring profit for the Corporation. Under this condition the policy gets Simple Reversionary Bonus. The plan should be in force and should be active as well. The Reversionary bonus will be planned on the paid premium.

Rider Benefit

There are no rider benefits as LIC Jeevan Akshay VI is a pension-based annuity plan.

Income Tax Benefit

  • There is no income tax for the premium paid by the customer under Section 80 C.
  • Tax has to be paid for the regular pension received by the customer.


No loan facility is available for this product.

Surrendering the Policy

The Jeevan Akshay VI policy cannot be surrendered.

Fixed Deposit

A fixed deposit is a financial instrument. This is provided by the banks and some companies (it is considered riskier to invest through companies) and it gives the investors a higher rate of interest than the savings account. There is a definite maturity date of the fixed deposits. Fixed deposit may or may not require a separate account. These are a safe way to invest money.

No money can be withdrawn from the fixed deposit before maturity in contrast to recurring deposit or a demand deposit. Some banks may provide extra services like providing loans against FD certificates at rates of interest that are competitive to that of other banks. The rate of interest provided in fixed deposit may be decreased when the economic conditions are disturbed. The FD has a range of tenure from 7 days to 10 years.

Fixed deposit is risk free investment. There are different types of FDs and these include senior citizen FD, Tax saving FD, FCNR deposits etc. Fixed deposits serve as short term as well as long term investments. General fixed deposits account can be opened with a lot of flexibility as far as maturity and amount of investment is concerned.

Fixed deposits provide good returns and are easily maintainable. The interest gained is not taxed till it reaches the Rs 1.5 lakhs exemption limit. The tax savings ones are beneficial as these allow earning as well as saving money. These can be renewed automatically. Renewal can be done at home through internet banking. Many FDs can be opened in multiple banks. Fixed deposits are transferable, these can be transferred from one branch to another.

The interest gained on fixed deposits is taxed. Some other financial instruments get tax-free savings.

Interest obtained from FD is charged with TDS. This is deducted from the interest accrued at the end of each year. If the income of the FD depositor is not more than Rs 2.5 lakhs a year, then no TDS will be deducted from interest on FD. In order that the bank knows about it, the depositor who has income less than Rs 2.5 lakhs per year should submit 15G and 15 H forms at the concerned branch.

The interest rate is lower than other investment options like mutual funds that can be more than 20 or 30%. The risks in mutual funds are more.

Sometimes the rate of inflation is more than the interest rate on FD.

The rate of interest on FD is fixed throughout its tenure which is why the gains are also fixed.

Fixed deposits are best for people with low risk appetite.

As it can be understood, Jeevan Akshay VI is a pension plan as the person gets a specific amount as annuity payment through the lifetime. The customer can choose to get payments after his/her death in which case the spouse gets the remaining pensions. Fixed deposits are not pension plans and the spouse does not get pension after the death of the annuitant.

In case of fixed deposits the depositor gets a maturity amount which is higher than the amount invested by them. There are seven different annuity options and of this Annuity with return of purchase price on death is similar to FD as it gives pension money along with pension benefit. This not the way Jeevan Akshay VI life insurance works. Some banks provide loans against FDs whereas no loan facility is available for Jeevan Akshay VI. The FDs can be liquidated but Jeevan Akshay Policy VI cannot be surrendered. There are no death benefits in either case. Both of these are good for people with low risk appetite.

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