If you think oldies are lining up for the new pension plans, think again. For it is actually the younger generation which is more aggressive in buying pension products to provide for their old age needs.

"About 50 per cent of the pension plans have been sold to policyholders below the age of 35 years," said Shikha Sharma, managing director and chief executive officer, ICICI Prudential Life Insurance Company.

As the Varishta Pension Bima Yojana left many out in the cold on account of the minimum age barrier, those below 55 years are saving under various other pension schemes.

• Varishtha Pension Scheme: FAQ

The Life Insurance Corporation of India has seen 317.71 per cent jump in premium collection under its pension plans during the first quarter of fiscal 2004.

This is even as its overall premium increased by just one per cent year-on-year in the first quarter.

ICICI Prudential Life Insurance Company, the second largest pension player in the country, has witnessed a 98 per cent growth in pension sales in the quarter under review.

"Rise in pension sales is partially on account of the awareness created through the marketing of Varishta Pension Bima Yojana," said senior LIC officials.

The success story of the senior pension scheme launched by the prime minister guaranteeing nine per cent returns, has rubbed off on the sale of other pension plans.

"Many large policies have been sold in the urban areas in the past one month, thereby increasing our overall premium growth," pointed out LIC officials.

Despite the entry of new players and removal of the guaranteed assured returns on its pension schemes, LIC continues to hold a 70 per cent share in the pension industry.

The corporation mopped up Rs 64.38 crore (Rs 463.8 million) in pension premium in the first quarter, with 11,576 policies sold.

This reflected a growth rate of 116.54 per cent over the number of pension plans sold in the corresponding quarter last fiscal.

ICICI Prudential Life mopped up Rs 11.7 crore (Rs 117 million) through the sale of pension plans in the first three months, reporting a 98 per cent growth rate.

Similar to Varishta Pension Bima Yojana, LIC has two immediate annuity plans -- Jeevan Akshay and Jeevan Dhara. These offer section 88 benefits under the Income Tax Act.

Policyholders can avail up to Rs 70,000 tax rebate under these schemes. Returns offered vary from 6.5 to 7 per cent depending upon the vesting age and choice of pension plan.

In the case of a pension plan, the maximum tax benefit has been capped at Rs 10,000 per annum under section 80 CCC of the Act.

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