ICICI Prudential Launches Swasthya Pension Scheme Under PFRDA Sandbox

The healthcare network is anchored by Apollo Hospitals, with access provided through the Apollo 24/7 platform, along with affiliated pharmacies, hospitals, and diagnostic centers.

ICICI Prudential Pension Funds Management Company has launched the Swasthya Pension Scheme under the Pension Fund Regulatory and Development Authority’s (PFRDA) regulatory sandbox framework, positioning it as a retirement-focused product with healthcare-linked withdrawal flexibility.

The scheme is designed to help subscribers build a retirement corpus while allowing partial withdrawals for medical expenses. It is positioned as a supplement to health insurance rather than a replacement.

Speaking at the launch in Mumbai, PFRDA Chairman Sivasubramanian Ramann said the product aims to ring-fence long-term retirement savings for health-related needs while leveraging aggregation benefits. He added that the regulator may, in the future, consider linking account opening to a subscriber’s existing health insurance coverage to reinforce its supplementary role.

Sumit Mohindra, Chief Executive Officer of ICICI Prudential Pension Fund, said recent reforms in the National Pension System (NPS) framework have enabled such innovation. He cited a gap in healthcare financing, noting that insurance penetration in the medical segment stands at about 38%, leaving a large portion of the population dependent on out-of-pocket spending. On average, households spend 15–20% of their income on medical expenses, with a significant share of hospitalization costs funded through asset sales.

For the proof-of-concept phase, the fund has introduced a variant with higher equity exposure, aligned with long-term retirement objectives. More conservative options may be introduced later based on subscriber risk appetite.

Under the scheme, subscribers can make multiple withdrawals of up to 25% of their own contributions, compared to the four partial withdrawals allowed during the tenure of a regular NPS account. In medical emergencies requiring more than 70% of the corpus, premature closure is permitted. Payments in such cases will be made directly to the healthcare provider, with the remaining balance transferred to a standard pension scheme.

The product is fully digital during the sandbox phase. The healthcare network is anchored by Apollo Hospitals, with access provided through the Apollo 24/7 platform, along with affiliated pharmacies, hospitals, and diagnostic centers. Physical facilities are currently limited to Bengaluru and Hyderabad during the pilot, while digital services are available nationwide. KFin Technologies is the digital partner for the initiative.

Enrollment during the sandbox phase is available through the company’s website and the Apollo 24/7 platform.

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