POSTAL LIFE INSURANCE – ELIGIBILITY – FACILITIES – POST OFFICE GUIDE
Postal life insurance was introduced on 1-2-1884 as a welfare measure for the benefit of Postal employees and now the scheme covers the employees of the following organizations :-
Eligibility for P.L.I.
(i) Central Government employees.
(ii) State Government employees.
(iii) Employees of Railways.
(iv) Employees of Defence – Armed Forces Personnel and civilians.
(v) Extra- Departmental Agents of P&T Department.
(vi) Industrial and workcharged employees of the P&T Department. All permanent and temporary employees with three years’ service of the following establishments :-
(vii) Local Fund/local bodies.
(viii) Universities established by Government.
(ix) Government aided educational institutions.
(x) Kendriya Vidyalayas.
(xi) Council of Scientific and Industrial Research.
(xii) Indian Standards Institution.
(xiii) Medical Council of India
(xiv) Dental Council of India.
(xv) Nursing Council of India.
(xvi) Pharmacy Council of India.
(xvii) Provident Fund Organisation.
(xviii) Indian council of Agricultural Research and its subordinate organizations.
(xix) Agricultural Produce Marketing Committee.
(xx) Reserve Bank of India.
(xxi) State Bank of India and its subsidiaries.
(xxii) Nationalised Banks.
(xxiii) Five Central Financial Institutions i.e. :
(a) Industrial Development Bank of India
(b) Industrial Finance Corporation of India.
(c) Industrial Credit and Investment Corporation of India.
(d) Industrial Reconstruction Corporation of India.
(e) Unit Trust of India.
(xxiv) Employees State Insurance Corporation.
(xxv) Khadi and Village Industries Commission
The following types of policies are issued by the P.D.I.F. :
(i) Whole Life Assurance :
Premium has to be paid monthly until the person reaches the age of 50, 55, 58, 60 or 70 years. The full value with the bonus accrued will be paid to the nominee assigns/successor on the death of the insurant
(ii) Endowment Assurance :
Premium has to be paid monthly until the person attains the age of 30, 33, 35, 40, 45, 50, 55, 58 or 60. the full value with the bonus accrued will be paid to the insurant when the policy matures. In case of earlier death the full value with bonus accrued till the time of death will be paid to the nominee/assignee successor.
(iii) Convertible whole life assurance :
Premium is required to be paid monthly at the rate applicable to whole life policy with premium ceasing at the age of 70. For the first five years, there will be an option to convert it into Endowment policy maturing at the age of 50, 55, 58 or 60, by agreeing to pay appropriate enhanced premium, at the end of 5 year from the commencement.
(iv) Anticipated endowment assurance :
This plan has two terms viz. 15 year term and 20-year term. In the case of policy for 15 years 20% of the sum assured is paid to the insurant at the end of 6th, 9th & 12th years and the remaining 40% with bonus accrued at the end of 15 years. In the case of 20 year policy, 20% of the sum assured is paid to the insurant at the end of 8th 12th and 16th year and the remaining 40% of the sum assured with bonus accrued at the end of 20th year. In the event of death of the insurant during the currency of these policies, the full amount assured with the bonus accrued will be paid to the Nominee/ assignee/ successor irrespective of the amounts already paid as survival benefits. (See Tables IV). The maximum age limit for a 15-year policy is 45 years and 40 years for 20-year policy.
Eligible persons may insure for a sum not less than Rs. 100/- and not more than Rs. 100000 in the cases 3(i) (ii) & (iii) above, and a minimum of Rs. 5,000/- and a maximum of Rs.1,00,000 in case of 3(iv) above.
P.L.I. offers the following special facilities :-
Lower premiums. – PLI premiums are lower. Extra premiums are not charged from Defense personnel, for war/aviation/high sea risk. Rebate at the rate of 5 paise per month per thousand is allowed on policies of Rs. 20,000/- and above. Rebate of 2 percent is admissible if premium for a year is paid in advance in cash.
Premium can be deducted at source from salary every month. The optional facility of payment of premiums in cash at the post office is also available. Premium Receipt Book is issued when premia are paid in cash.
Special concessions for payment of premiums to the insurants affected, by natural calamities.
There is provision for payment of premium by cheque when the amount is Rs.20/- and above.
INCOME TAX REBATE. – PLI premiums are eligible for income tax rebate, under section 80-C of I.T. Act.
Loans can be obtained easily against PLI policies and repayment of principal before maturity is optional.
Whole life policy can be converted into an Endowment Policy.
Non-medical policies are also issued for those below 28 years of age under certain conditions.
Exemption from Stamp Duty.- PLI policies and loan bonds are exempt from stamp duty.
All PLI policies are with profit policies.
Nominations. – Facility of nomination and assignment is available at no extra cost.
Higher Bonus. – PLI gives higher bonus. The latest rates of bonus on postal life insurance policies declared for the valuation period 1978 – 81 are as under :-
(i) Endowment Policies Rs. 35.00 (Per thousand of sum assured per Bonus is paid on paid up policies also annum.)
(ii) Whole Life Policies Rs. 44.00 (Per thousand of sum assured per Bonus is paid on paid up policies also annum.)
Credit is admitted on production of disbursing officer’s certificate.
Exemption from production of succession certificate in hard cases.
Payments for claims are made from the nearest Post Office.
Proposal forms for effecting insurance are available at departmental Post Offices. The forms should be filled in by the proposer in the presence of his immediate superior Development Officer who will then affix his signature at the proper place. After the Principal Record Officer/immediate superior furnishes the required certificates on the proposal form, the same will be made available to the nearest Government Medical Officer, authorized private medical practitioner. The Medical Officer, will after examination of the proposer will furnish the required certificates, to the P.M.G. for acceptance of the proposal in this regard.
Rates of Premia. – The tables of premium for all the four types of policies are furnished at the end of this Section.
Manner of realizing premia.
(i) The first premium should be paid in cash in the Post office selected by the proposer on or before the date intimated by the P.M.G. who accepts the proposal.
(ii) Subsequent premia can also be paid in cash in any post office selected by the insurant on or before 21st of every month, in case the insurant has exercised option to pay the premium in cash. In that case he will be issued a premium receipt book in which entries relating to the payment of each premium shall be made. Alternately, the premia can be recovered from the pay of the insurant. In such cases the premium for the month is recovered from the pay of the previous month (i.e. premia for February is recovered from the pay for January) and it will be the responsibility of the insurant to ensure that the premia are regularly recovered and credited to P.O.I.F by his premia are regularly recovered and credited to P.O.I.F. by his employer every month. Until recovery from pay commences premia should continue to be paid in cash at the Post Office.
(iii) In case of any insurant whose premium is recovered from pay, ceasing to be an employee of the organization which made him eligible for PLI and does not join any other organization of this nature as an employee for any reason, after the insurance has been effected, he should pay further premia in cash at a post office selected by him. He should inform the PMG about the change and request for issue of a Premium Receipt Book.
Conversion. – Alteration of policy terms, reduction, discontinuance or commutation of premiums are permissible under certain conditions. Details can be ascertained from the P.M.G.
Revival of policies. – A policy becomes void, if any premium due on it remains unpaid. It can, however, be revised by the PMG at his discretion, if all the premia due with such fine as he may impose are paid and a medical certificate of continued good health is produced. An application for revival should be made to the PMG.
Loans. – Loans are granted on the security of the policies, provided the policy has been in force for at least three years, in the case of endowment policies; and five years. In the case of whole life policies, applications for loans should be made to the PMG.
Surrender. – A policy may be surrendered for an immediate payment in cash, provided the policy is of not less than three years duration and is in force on the date of application.
Settlement of claim. – 1.(a) The face value of the policy together with the bonus accrued on it becomes payable either :
(i) on the insurant attaining the age specified in the policy, or
(ii) on the death of the insurant.
(b) In the former case, the sum assured alongwith the bonus accrued will be paid to the insurant on his applying for it in the prescribed proforma (see appendix) and enclosing the following documents alongwith the application: –
(1) Policy document or the loan repayment book if a loan was taken.
(2) Premium receipt Book, in case premia was paid in cash.
(3) Certificate from the pay disbursing authority showing the recoveries of the last 6 instalment of premia, in case premium was paid through recovery from the pay of the insurant. The application with the documents should be submitted immediately after paying the last premium to the Postmaster General.
(c) In the case of the death of the insurant, the sum assured and bonus accrued is payable to the nominee/assignee of the insurant. In the absence of the nomination or assignment on the policy, the total amount will be paid to the legal heir/successor on production of evidence to that effect. The claimant should apply in the prescribed proforma (see appendix) and forward it to the Postmaster General along with the following documents: –
(1) Policy document or loan repayment book, if a loan was taken on the policy.
(2) Certificate of death of insurant.
(3) Premium receipt Book, if premia were paid in cash or pay recovery certificate for the last 6 months if premia were recovered from the pay of the insurant.
(4) Legal evidence to show that the claimant is the successor/legal heir to the insurant, in case there is no nomination or assignment.
Bonus. – The rate of bonus for each type of policy is declared once in three years. The next valuation is due in 1984.