by On February 1, 1884, Postal Life Insurance (PLI), the oldest insurer in the country was introduced under the Queen Empress of India with the express approval of the Secretary of State (for India) to Her Majesty. The scheme at the time was intended as welfare scheme to benefit Postal service employees. It was later extended to employees of Telegraph department in 1884. In its early initiation days the maximum insurance amount limit was Rs.4,000, currently at Rs. 50 lakhs.
The Postal Life Insurance schemes are some of the most convenient and reasonably low-premium personal investment products in the country.
Postal Life Insurance Scheme offers life insurance cover with high returns on premium. The maximum sum assured offered under this scheme is Rs. 50 lakh. This policy is offered by the Government of India, to employees of Central and State Public Sector Enterprises, Central and State Governments, Government Aided Educational Institutions, Universities, Government aided Educational Institutions, Autonomous Bodies, Local Bodies, Cooperative Societies, Joint Ventures having a minimum of 10% Government/ PSU stake, etc. A group insurance scheme is also managed by Postal Life Insurance, which is for “Gramin Dak Sevaks”, i.e., Extra Departmental Employees, of the Department of Posts.
Features of Postal Life Insurance Policy:
Nomination facility: The policyholder can nominate his/her beneficiary, and can also make changes to the nomination.
Loan facility: Loan facility is available against this policy. The policyholder can pledge his/her policy as a collateral to the Heads of the Region/ Circle on behalf of the President of India, once the policy has attained 3 years maturity in case of an Endownment Assurance policy and 4 years policy period has been completed in the case of a Whole Life Insurance policy. Assignment facility is also available under this scheme.
Policy Revival: A policyholder can revive a lapsed policy. The policy can be revived when policy has lapsed under the following conditions –
- Policy has lapsed after 6 successive non-payments of premium with the policy being in effect for less than 3 years.
- Policy has lapsed after 12 successive non-payments of premium where policy has been in effect for more than 3 years.
Duplicate Policy Document: A duplicate policy document will be issued to the policyholder if he/she has lost the original document. This also applies to the case where the original policy document is mutilated, burned or torn and the insured wants a duplicate of the same.
Conversion of Policy: This policy can be converted from a Whole Life Assurance policy to an Endowment Assurance Policy. An Endowment Assurance Policy can be converted to another Endowment Assurance plan as per the regulations and guidelines laid down by the insurer.
Benefits of Investing in PLI:
Some of the other benefits and discounts offered under the Postal Life Insurance scheme are as follows:
- The insured can avail income tax exemption as provided under Sec. 88 of the Income Tax Act.
- The premium payable for the sum assured and coverage is much lower than that payable under any other.
- Additional facilities offered under this policy are Assignment, Loan, Conversion, Surrender and Paid-Up Value options.
- The policy can be transferred to any Circle within India, at no additional charges.
- Passbook facility is available to track the payment of premium and in case of loan transactions, etc.
- Premium can be paid on an annual, half-yearly and monthly basis. When the payment is due, the policyholder can make a payment on any working day.
- If you make an advance premium payment for a policy period of 6 months, you can avail a discount on premium worth 1% of the value.
- If you make an advance premium payment for a policy period of 12 months, you can avail a discount on premium worth 2% of the value.
- Nomination facility is available.
- Since this scheme has a centralized accounting facility, claims process is quick and easy.
Rural Postal Life Insurance
Rural Postal Life Insurance (RPLI) plays a significant role in the insurance sector of India. RPLI online scheme was introduced in March 1995, especially for the benefit of rural people. RPLI scheme in post offices emphasizes on weaker or women population so that these people can also lead a healthy and wholesome life by opting for various rural postal insurance policies.
Eligibility Criteria and Features
- Minimum and Maximum age at entry: 19 years and 55 years respectively.
- Minimum and maximum sum assured: Rs.10,000 and Rs. 10 lakhs respectively.
- Loan facility: Only after 4 years
- Surrender: Only after 3 years of the completion of the policy
- Premium: Premiums will be varied based on the sum assured and the age of the candidate
- Rural postal life insurance bonus rates: Rs. 65 per Rs. 1000 of the sum assured
Benefits of Rural Postal Life Insurance in India:
Several benefits are associated with rural postal insurance schemes. A host of different schemes are available under the rural insurance umbrella. Some of the most outstanding advantages of these schemes are listed as under.
- Policyholders of rural postal insurance schemes can avail credit by pledging their schemes as collateral for security. The policy has to be pledged with the Heads of the Circle and is eligible for loan only if 3 years or more are completed in case of endowment schemes and 4 in case of whole life assurance.
- Rural postal insurance policies can be pledged with any financial institution for obtaining credit.
- Policies under rural postal insurance can be revived in case it lapses due to non-payment of insurance premium.
- Insurance policies can be converted from one scheme to another under rural postal insurance. So if a customer is not satisfied with features and benefits of one scheme, he/she can get it converted to another as per rules set by postal insurance department.
- Nomination facility is available and nomination can be duly changed as per policyholder’s requirement. This can be done by placing a request with the postal insurance department.
