Postal Life Insurance

Postal Life Insurance (PLI) is the oldest insurer in India. It was introduced in 1884 with the approval of the Secretary of State to the Queen Empress of India. At that time, the scheme was intended to be a welfare scheme for Postal service employees. The scheme was extended to the employees of Telegraph department later. In its initial days, the maximum insurance amount was capped at Rs.4,000, which is currently capped at Rs. 50 lakhs. These schemes are not only convenient but also reasonable as they are low-premium personal investment products.

Postal Life Insurance Schemes offer Life Insurance cover and promise high returns on premium. The maximum amount offered as sum assured under this scheme is Rs. 50 Lakhs. It's an offering by the Government of India. It is meant for employees of Central and State Governments, Central and State Public Sector Enterprises, Government-aided Educational Institutions, Cooperative Societies, Autonomous Bodies, Local Bodies, Joint Ventures with a minimum of 10% Government/PSU stake, etc. PLI also offers a group insurance scheme called “Gramin Dak Sevaks,” meant for the Extra Departmental Employees of the Department of Posts.

Features

Postal Life Insurance policies offer the following benefits to the policyholders:

• Nomination facility: In PLI schemes, the policyholder can not only nominate the beneficiary but can also change to the nominee later.

• Loan facility: PLI schemes offer loan facility against the policy. The policyholder may pledge the policy as collateral. For Endowment Assurance policies, the policy should complete 3 years of policy term Whole Life Insurance Policies should complete at least 4 years in order to be eligible for this benefit. Moreover, assignment facility is also available under PLI schemes.

• Policy Revival: Lapsed policies can be revived by the policyholder under the following conditions:

  • Lapsed after six consecutive non-payment of premium, provided that the policy has been in effect for less than three years.

  • Lapsed after 12 consecutive non-payment of premium, provided that the policy has been in effect for more than three years.

• Duplicate Policy Document: In case the original policy documents are lost or damaged, a duplicate policy document can be easily procured.

• Conversion of Policy: Policyholders can convert a Whole Life Assurance policy into an Endowment Assurance Policy, which can be further converted to another plan as per the insurer's regulations and guidelines.

Benefits

These are the benefits that one can receive by investing in the Postal Life Insurance schemes:

• Exemption from income tax under Sec.88 of the Income Tax Act

• As compared to other insurance plans, the premium payable is much lower for the sum assured and the coverage provided

• Additional facilities like Assignment, Conversion, Loan, Surrender and Paid Up Value options

• Transfer of the policy to any Circle within India, at no extra charges.

• Passbook facility for tracking the premium payment, loan transactions, etc

• Flexible premium payments on an annual, half-yearly or monthly basis

• Advance premium payments made for a policy period of 6 months provides a discount on the premium amount worth 1% of the value

• Advance premium payments made for a policy period of 12 months provides a discount on the premium amount worth 2% of the value

• Nomination facility

• Quick and easy claims

Eligibility

The employees of the following organizations are eligible to purchase a Postal Life Insurance policy:

• Defense Services

• State Government

• Central Government

• Para-Military forces

• Local Bodies

• Reserve Bank of India

• Government-aided Educational Institutions

• Public Sector Undertakings

• Nationalized Banks

• Scheduled Commercial Banks

• Financial Institutions

• Autonomous Bodies

• Central/ State Government employees appointed on an extendable contract basis

• Extra Departmental Agents in Department of Posts

• Employees of educational institutes accredited by AICTE, NAAC, Medical Council of India, etc.

• Employees of Government-recognized Co-operative Societies registered under the Co-operative Societies Act

Types of Postal Life Insurance Schemes

There are seven types of PLI Schemes available. A brief description of the policies are mentioned below and the features of the same are listed in the table that follows.

Whole Life Assurance (Suraksha)

The Sum Assured plus the accrued bonus is payable either when the policyholder attains 80 years of ages or to the legal nominee on the death of the policyholder, whichever is earlier, provided that the policy is active on the date of claim.

Endowment Assurance (Santosh)

• The proponent gets an assurance to the extent of the sum assured plus accrued bonus till he/she attains a pre-determined age of maturity.
• In case of the policyholder's death, the nominee or the legal heir receives the sum assured plus accrued bonus

Convertible Whole Life Assurance (Suvidha)

• An added option of converting to Endowment Assurance Policy after 5 years of commencement
• An assurance to the extent of the sum assured plus accrued bonus until  maturity age is attained
• In case of the policyholder's death, the nominee or the legal heir receives the sum assured plus accrued bonus

Anticipated Endowment Assurance (Sumangal)

• Money Back Policy for those in need of periodical returns, with policy terms of 15 years and 20 years  
• Survival benefits paid periodically - 15 years Policies get 20% of the sum assured each upon completion of the 6th, 9th & 12th year and 40% of the sum assured with the accrued bonus on maturity; 20 years Policies get 20% of the sum assured each upon completion of the 8th, 12th & 16th year and 40% of the sum assured with the accrued bonus on maturity
• Survival benefit payments are not taken into consideration in the event of the unexpected death of the policyholder; the full sum assured plus accrued bonus is payable to the nominee or legal heir

Joint Life Assurance (Yugal Suraksha)

• Joint Life Endowment Assurance for couples
• One of the spouses must be eligible for PLI policies
• Both get life cover to the extent of sum assured plus the accrued bonus
• Death benefits paid to either of the survivors in the event of the death of a spouse

Children Policy (Bal Jeevan Bima)

• Life insurance coverage to children of the policyholders
• Maximum two children of policyholder are eligible
• No premium is to be paid in the event of the policyholder's death
• Total sum assured plus the bonus accrued is paid on the completion of the policy term

	Suraksha	Santosh	Suvidha	Sumangal	Yugal Suraksha	Bal Jeevan Bima
Min. Age	19 years	19 years	19 years	19 years	21 years	5 years
Max. Age	55 years	55 years	55 years	*40 years for 20 year policy term *45 years for 15 year policy term	45 years	*20 years (child) *45 years (parent)
Min Sum Assured	Rs.20,000	Rs.20,000	Rs.20,000	(money back policy)	Rs.20,000	Sum assured of the parent’s policy
Max. Sum Assured	Rs.50 lac	Rs.50 lac	Rs.50 lac	Rs. 50 lac	Rs.50 lac	Rs. 3 lac
Loan facility	After 4 years	After 3 years	After 4 years	-	After 3 years	-
Surrender	After 3 years	After 3 years	After 3 years	-	After 3 years	-
Last declared Bonus	? 85/- per ? 1000 sum assured per year	? 58/- per ? 1000 sum assured per year	? 85/- per ? 1000 sum assured per year (if not converted to endowment assurance)	? 53/- per ? 1000 sum assured per year	? 58/- per ? 1000 sum assured per year	? 58/- per ? 1000 sum assured per year.

Postal Life Insurance Customer Guidelines

People looking to invest in PLI schemes can follow these guidelines before investing in these policies.

• The policy number is available on the policy document. This number is important as it will be required for future references, in order to identify the policy or to make any transaction.

• The Policy Bond is a crucial document. Keep the original papers safely. It is required at the time of claim settlement. Lost or damaged policy bonds can be replaced with a duplicate one by requesting the insurer.

• Premiums must be paid regularly for the policy cover to stay in effect. Policies lapsed due to non-payment will be denied the and thus the policyholder will be unable to place a valid claim.

• Premium should be paid in advance. It is due on the 1st day of each calendar month. A penalty will be levied for late payments. A grace period extending till the last working day of the month is available.

• Premiums can be paid through deduction from pay provided that the policyholder procures the consent of the employer. If approved, the premium amount will be deducted from the policyholder’s salary every month and the same will be mentioned in the salary slip.

• The PLI policy can be transferred to any other Circle within the country if the policyholder has got a job transfer.

• The premiums can be paid through Cheque or Cash. Options for online payment, Electronic Clearance System (ECS), over the counter payment at post offices, etc. are available.

• The policyholder must ensure that accurate information (like address and phone number) are registered with the policy. This is critical at the time of a claim because the Claim Cheque is sent to the address specified. Therefore, any change in the personal particulars must be updated immediately.

• Policies will lapse after six consecutive non-payment of premium if the policy has been in effect for less than three years and after 12 consecutive non-payment of the premium for policies in effect for more than three years.

• If discontinued policies have not been reinstated within the revival period, the policyholders can request the Chief Postmaster General for the revival of the same. However, the revival is subject to the complete payment of all pending premiums along with interest. Additionally, the policyholder is required to submit a medical report certifying that he/she is in good health and his/her health background remains unchanged.

• Policies that have been in effect for three years or more are eligible for a loan. The policy bond will be considered as collateral for such loans. The loan facility can also be availed if the policy has accrued a surrender value of Rs. 1000.

Postal Life Insurance Premium Calculator

One can calculate the amount of premium to be paid on their Postal Life Insurance policy by using an online calculator tool. A few relevant details are required by the premium calculator tool to estimate the premium amount that has to be paid by the policyholder for the cover required. A few factors that affect the premium are – the type of policy, the age of the policyholder, the sum assured required, etc. These details have to be provided, along with other information, such as age as the date of application, type of policy, required sum assured, the policyholder's date of birth, the spouse’s date of birth for those  applying for the “Yugal Suraksha” scheme, the age of the insured person at the maturity of the policy, etc. In these policies, the minimum sum assured is Rs. 10,000 and the maximum is Rs. 50,00,000. The available PLI policy types are – Anticipated Endowment Assurance Plan, Endowment Assurance Plan, Whole Life Assurance Plan, and Convertible Whole Life Assurance Plan. After providing all the relevant details, users must click on the “submit” tab to receive all the details regarding the monthly premium.

Postal Life Insurance Forms

The proposal forms available online on the Postal Life Insurance website for download are:

• RPLI Medical Form

• Yugal Suraksha Form

• Child Proposal Form

• WLA (Whole Life Assurance) Form

• CWLA (Convertible Whole Life Assurance) Form

• RPLI (Rural Postal Life Insurance) Form

• EA (Endowment Assurance) Form

• AEA Form

• Form for Revival of Lapsed Policy

• Loan Application Form

• Claims Form

• Maturity Claim Form

• Survival Benefit Claim Form

• Personal Bond of Indemnity Form

FAQs

What is the primary difference between Postal Life Insurance & other Insurance?

Postal Life Insurance plans are only for Government and Semi-Government employees while other insurances are available to all.

Who are eligible to use PLI schemes?

The employees of the following organizations are eligible to purchase a Postal Life Insurance policy:

• Defense Services

• State Government

• Central Government

• Para-Military forces

• Local Bodies

• Reserve Bank of India

• Government-aided Educational Institutions

• Public Sector Undertakings

• Nationalized Banks

• Scheduled Commercial Banks

• Financial Institutions

• Autonomous Bodies

• Central/ State Government employees appointed on an extendable contract basis

• Extra Departmental Agents in Department of Posts

• Employees of educational institutes accredited by AICTE, NAAC, Medical Council of India, etc.

• Employees of Government-recognized Co-operative Societies registered under the Co-operative Societies Act

Do Postal Life Insurances have any guarantor?

Yes, Government of India serves as the guarantor for Postal Life Insurance.

Do both the spouses need to be Government employees to be eligible for Postal Life insurance?

No, under the 'Yugal Suraksha' scheme, a couple can purchase the policy if either of them is a Government employee.

If the policyholder quits Government service, can they still continue with the scheme?

Yes, they can, as long they keep paying the premiums.

Can a lapsed policy be revived?

Lapsed policies can be revived by the policyholder under the following conditions:

• Lapsed after six consecutive non-payment of premium, provided that the policy has been in effect for less than three years.

• Lapsed after 12 consecutive non-payment of premium, provided that the policy has been in effect for more than three years.

Can PLI be surrendered?  

Yes. However, the surrender value is determined by the surrender factor, type and the policy term.

Can PLI policyholder avail loan facility from PI?

Yes. However, it depends upon the type of insurance scheme and also the tenure of the insurance.

How many child policies can the main policyholder take?

The family of the main policyholder can have maximum 2 children insured under the child policy.

Does PLI help in saving income tax?

Yes, PLI is a tax exempted insurer under Section 118-C of the Insurance Act of 1938 and under Section 44-D of LIC Act of 1956.

When was the PLI Scheme introduced?

The PLI scheme was introduced in 1884, during the British rule.

Can an employee in a private sector enterprise avail this policy?

No. Private sector employees are not eligible for PLI.

Where can one find the PLI policy number?

PLI policy number is a six digit number found in the policy document/ bond.

Can Postal life insurance premium be paid online?

Yes, one can pay the PLI policy premium online or through ECS (Electronic Clearance System).

What is the interest accrued on loan availed against a PLI policy?

The interest on loans against PLI policies is 10% per annum, calculated on the basis of a six month period.