Wednesday, 10 August 2011

Mou between govt. of U.P and L.I.C. : A Positive Step for providing sustainable income through annuity payment for 33 years / one-time-payment to land-owners whose land has been acquired for the Developmental Projects in Uttar Pradesh

With a view to adequately compensate the land-owners, whose land is acquired for various developmental projects and to ensure sustained income for the farmers/ landowners and their families, GoUP has come up with Rehabilitation and Resettlement Policy, as contained in G.O.(s) No.: 1307/1-13-10-20(29)/ 2004, Dated 03.09.2010 and 632/ek-13-11-20(29)/ 2004, Dated 02.06.2011. The policy provides for annuity payment for a period of 33 years or consolidated Rehabilitation Grant Payment in one go to affected farmers/land-owners. The policy aims to spread the feeling amongst the land-owners whose land has been acquired that they are also a part of the project.

This policy is therefore, a positive step taken by the State Govt to protect the interests of the land-owners and to provide them the other facilities. The policy empowers the land-owner to seek a better price and gives a choice to him to decide how he wishes to accept compensation.

In its bid to ensure fulfilment of commitments made through its Land Acquisition Policy, the Govt. of U.P. has gone a step further and signed an MoU with the LIC of India on 15th July, 2011.

The salient features of the MoU are enunciated hereunder:

i.    The Government of U.P. normally acquires around 5,000 hectares land per year for the developmental projects under Land Acquisition Act, 1894.

ii.   It will ensure the continuity of payment of 'Varshiki' (Annuity) to the affected farmers/land-holders under the policy.

iii.  Under the policy, the Government shall make the following payments to the affected farmers/landholders:


One time Payment in lieu of Annuity, hereinafter referred to as Consolidated Rehabilitation Grant Payment
Annual payment
Increment, per annum
G.O. No.: 1307/1-13-10-20(29)/ 2004, Dated 03.09.2010
33 years
2,40,000 /-
G.O. No.: 632/ek-13-11-20(29)/ 2004, Dated 02.06.2011
33 years

Iv.   For avoidance of doubt, it has been made clear that :

·    Land-owners whose land is acquired on or after 03.09.2010 and upto 01.06.2011 shall be eligible for payment of annuity or Consolidated Rehabilitation Grant Payment  as per provisions of G.O. dated 03.09.2010
·   Land-owners whose land is acquired on or after 02.06.2011 shall be eligible for payment of annuity or Consolidated Rehabilitation Grant Payment  as per provisions of G.O. dated 02.06.2011

v   Under the MOU, Government  makes payment of the premium based on the assumption of average age of beneficiaries to be 45 years, in lieu of the services provided by LIC.

vi   LIC offers to provide the services of making annuity or Consolidated Rehabilitation Grant Payment  after having obtained the product specific approval known as Group Flexible Income Plan from Insurance Regulatory Development Authority (IRDA)

vii. The concerned District Magistrate/Collector implements the Scheme and discharge the role and responsibilities for and on behalf of the Government.


  • The Government makes the payment through concerned DM(s)/Collector(s) to LIC based on the land acquired under the Act within three months of passing of award under the Act.
  • The payment of premium to the LIC is to be made in respect of each award in single instalment together with list of beneficiaries.
  • Provide database of the Beneficiaries alongwith their successors/nominee details, the due dates of annuity payment to them and consent for accepting Annuity or consolidated Rehabilitation Grant Payment  to the LIC.
  • For avoidance of doubt, it is made clear that the payment of amount towards premium shall be made by the concerned land acquiring body to the concerned District Magistrate/Collector who shall pay the said premium amount to LIC on behalf of Government.


The concerned District Magistrate/Collector for the land acquired in his District shall make the following payments of premiums to LIC for payments to Beneficiaries under the Scheme as per consent of Beneficiaries:


Towards Annuity
Towards Consolidated Rehabilitation Grant Payment
G.O. No.: 1307/1-13-10-20(29)/2004,
Dated 03.9.2010
Rs. 3,42,023/= as per the quote of LIC
Rs. 2,40,000 /=
G.O.: 632/ek-13-11-20(29)/2004,
Dated 02.6.2011
Rs.4,07,679/= as per the quote of LIC
Rs. 2,76,000/=

            The Government, through District Magistrate/Collector makes the first payment of premium to LIC within 15 days, for atleast 50 Beneficiaries alongwith the consent of Beneficiaries & their other details.


·    LIC makes the Annuity payment under the Scheme to each Beneficiary, irrespective of their age.

·    The First payout of Annuity to the Beneficiary is to be paid by the LIC to the Beneficiary opting for annuity payment within three months of receiving the premium, and thereafter, the payments under the Scheme shall be made annually.

·    The Consolidated Rehabilitation Grant to the Beneficiary opting for one time payment under the Scheme is to be paid by the LIC within three months of receiving the payment from Government.
·    The date of making first Annuity payment to the Beneficiary by the LIC is the Due Date for making payments in the subsequent years also.

·    LIC  issues individual Certificates with distinctive numbers to all the Beneficiaries and their successors enrolled and finalized by the concerned District Magistrate/ Collector.
·     A Toll Free No.18001805080 has recently been established by LIC to facilitate communication in Hindi during office-hours of all working days.
·    LIC has fully equipped and operational offices at all District Headquarters of Uttar Pradesh to operate the Scheme.


       LIC  provides district-wise MIS Reports to the Government on regular intervals.


      Government to constitute a Project Monitoring Committee which would meet once in every three months, to be chaired by Chief Secretary–GoUP with Infrastructure & Industrial Development Commissioner, and Principal Secretaries 0f Industries, Finance, Law & Revenue (as Convenor) & as members; to review & monitor the progress of the Scheme.  A representative of LIC shall also be present, and provide all information for meetings.

  •       Government is also entitled to include Beneficiaries of the Scheme with effect from 03.09.2010 to the Policy issued under the Group Income Flexible Plan of LIC for making payments.
  •       In the event the Government revises its Annuity rates under the Scheme during the period of MOU, then LIC shall accordingly on a proportionate basis revise its quotes for Annuity payments.   

With every care taken by the Government, this MOU will prove to be a stepping stone to safeguard the rights and benefits of land-owners. It is envisaged that with the involvement of a service provider like LIC in Annuity payment scheme, hassle free and smooth payments will be made to the beneficiaries or their nominees throughout the stipulated period of 33 Years. This will go a long way in providing project affected people with a sustained income and sense of financial security and contribute to over all socio-economic development of the state.   

R.C. Bhatt


  1. A very well written article. It do send across the message that by selecting LIC as a service provider, the Government of U.P. has taken a very well thought and prudent step to secure the financial interest of the project affected farmers

  2. It's provided all factor of insurance related that useful too get suggestion.I know about UP and LIC the Developmental Projects and his collaboration by the blog.

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