Postal Life Insurance Scheme 2023 - Benefits & Eligibility

By Okbima 16 Dec 2023
Postal-Life-Insurance-Scheme

 

A Postal Life Insurance Scheme is a life insurance scheme, established in 1884, and is one of the oldest life insurance schemes in India. Managed by the Department of Posts under the Government of India, this initiative serves the purpose of providing life insurance coverage to individuals across the country. The Postal Department offers two types of life insurance schemes – “Postal Life Insurance” (PLI) and “Rural Postal Life Insurance” (RPLI).

 

What is a Postal Life Insurance Scheme?

Postal Life Insurance Scheme is a government-backed life insurance scheme, established by the Department of Posts under the Ministry of Communications. PLI was initially a welfare scheme exclusively for the employees of the Postal Department. The scheme aims to offer life insurance benefits at affordable prices compared to other life insurance plans, making it accessible to a wider population. 

In 1894, PLI became the first insurance company to extend its coverage to female employees and currently provides insurance coverage to a diverse range of individuals, including Central and State Government Employees, Defense and Para-Military Services personnel, employees of banks, local bodies, and professionals such as Chartered Accountants, Engineers, Doctors, Lawyers, MBAs, among others. 

 

What is the Rural Postal Life Insurance Scheme?

The Rural Postal Life Insurance Scheme (RPLI) is an initiative by the Indian postal department to provide life insurance coverage to the rural area of India. Launched in 1995, after the recommendations by the Malhotra Committee in 1993, which highlighted that only 22% of the Indian population was insured, and life insurance accounted for approximately 10% of total household savings.

RPLI is a solution to cover this gap, using its huge postal network spread across the nation, which presents cost-effective and accessible insurance services. It is a crucial step towards inclusive financial growth, allowing for a more comprehensive penetration of insurance into India's rural areas.

 

Benefits of Postal Life Insurance Scheme

The Postal Life Insurance Scheme (PLI) in India is an insurance product that comes with several benefits for policyholders. Some of the significant benefits of opting for a Postal Life Insurance Scheme are given below.

• Discount on Premiums: Customers who pay their Postal Life Insurance premiums in advance can avail discounts, which add to the savings over time. For example, if you choose to pay for 6 months in advance, you can receive a 1% discount, or a 2% discount if you pay for an entire year’s worth of premiums, which can result in substantial savings over the lifespan of the policy.

• Easy and Quick Claims: The PLI operates with a centralized accounting system, which ensures the claims settlement process is easy and hassle-free. This results in a quick and simple claim process, often without the usual delays that can be associated with insurance claims.

• No Charges on Transfer: If you move to a different city or state within India, another benefit of the PLI is the ability to transfer your policy to another circle without any additional fees. This flexibility can be particularly beneficial for individuals who have jobs that require frequent relocations.

• Premium Payment Mode: PLI offers flexibility in making premium payments. You can choose from different payment modes such as annual, semi-annually, or monthly, depending on your convenience. This makes it easier to manage payment timings in alignment with your cash flow.

• Income Tax Benefits: One of the most attractive benefits of the Postal Life Insurance Scheme is the tax relief you can claim. Premiums paid towards PLI are eligible for tax deductions under Section 80C of the Income Tax Act, thus reducing your taxable income and saving you money on taxes.

 

Features of Postal Life Insurance Scheme

The Postal Life Insurance Scheme (PLI) is an insurance service offered by the postal department of India. The features of the Postal Life Insurance Scheme include aspects that are highly beneficial to policyholders which are mentioned below.

• High Returns with Low Premium: PLI is known to offer attractive bonus rates which result in superior returns for policyholders, all while charging relatively lower premium rates compared to other insurance providers in India. 

• Loan Facility: PLI policyholders can take loans against their policy, either directly from the Department of Post or by assigning the policy to other financial institutions. This offers financial support to policyholders when they require funds, without them having to liquidate their policy.

• Revival of Lapsed Policy: PLI policies provide opportunities for revival. Policies that have lapsed due to non-payment of premiums can be revived multiple times throughout their term, provided no more than five consecutive years have elapsed since the last unpaid premium.

• Policy Conversion: Flexibility is a key feature of PLI, and thus policyholders are allowed to convert a whole life insurance policy into an endowment assurance policy, depending on certain terms and conditions. 

• Multiple Policies: Individuals are permitted to have multiple policies under the PLI scheme, as long as the total sum assured across all policies is within the minimum and maximum limits set currently, Rs 20,000, and not more than Rs. 50 lakh.

 

Types Of Policies Offered By Postal Life Insurance Scheme

The Postal Department of India offers 6 types of policies under the postal life insurance scheme, Here we have mentioned the different types of postal life insurance plan details to make you a wise decision. 

1. Whole Life Assurance Policy (Suraksha)

Postal Life Insurance (PLI) offers a comprehensive Whole Life Assurance Policy, commonly known as "Suraksha," providing policyholders with financial security and peace of mind.

 

Parameter

Minimum

Maximum

Entry Age

19 years

55 years

Sum Assured

Rs.20,000

Rs.50 Lakhs

Policy Term/Maturity

80 years or death, whichever is earlier

 

Policy Conversion

Up to the maximum age of 59 years

 

Premium Payment Ceasing Age

55, 58, or 60 years of age of the insured

 

Loan Facility

Available after 4 years

 

Surrender

After 3 years (if you surrender before 5 years, no bonus will be paid)

 

Bonus Rate

Rs.76/per ?1000 SA /year as on 01.03.2023

 

 

2. Convertible Whole Life Assurance Policy (Suvidha)

The Convertible Whole Life Assurance Policy, known as "Suvidha," offered by Postal Life Insurance (PLI), is an insurance scheme designed to provide policyholders with flexibility and the opportunity for long-term financial planning. 

 

Parameter

Minimum

Maximum

Entry Age

19 years

55 years

Sum Assured

Rs. 20,000

Rs. 50 Lakhs

Policy Conversion

convert  endowment insurance policy after 5 years, but not more than 6 years 

 

Loan Facility

Available after 4 years

 

Surrender

After 3 years (if you surrender before 5 years, no bonus will be paid)

 

Bonus Rate

Rs. 76/per Rs. 1000 SA /year as of 01.03.2023

 

 

Note: If you convert your policy, you will receive a bonus for your endowment assurance.

 

3. Endowment Assurance Policy (Santosh)

Endowment policies are a type of life insurance that provides coverage for a specified term, and the policyholder receives the sum assured along with any accrued bonuses at the predetermined maturity age.

 

Parameter

Minimum

Maximum

Entry Age

19 years

55 years

Sum Assured

Rs.20,000

Rs.50 Lakhs

Loan Facility

Available after 3 years

 

Maturity at a predetermined age

35 years, 40 years, 45 years, 50 years, 55 years, or 60 years

 

Surrender

After 3 years (if surrendered before 5 years, no bonus will be paid)

 

Bonus Rate

Rs.52/- per Rs.1000 SA /year as on 01.03.2023

 

 

4. Anticipated Endowment Assurance Policy (Sumangal)

The Anticipated Endowment Assurance Policy, popularly known as Sumangal, offered by Postal Life Insurance (PLI), is a unique and beneficial money-back plan designed to cater to the financial needs of individuals who seek periodic returns. 

 

Parameter

Minimum

Maximum

Entry Age

19 years

  • 40 years for 20 years term plan

  • 45 years for 15 years term plan

Sum Assured

Rs.20,000

Rs.50 Lakhs

Policy Term

15 years and 20 years

 

Survival Benefits

For a 15-year term policy: 20% of the sum assured on completion of the 6th, 9th, and 12th year of policy and balance 40% with bonus on maturity.

For 20 years policy: 20% of the sum assured on completion of the 8th, 12th, and 16th year of policy and balance 40% with bonus on maturity.

Bonus Rate

Rs. 48/- per Rs. 1000 SA per year as of 01.03.2023

 

 

5. Joint Life Assurance Plan (Yugal Suraksha)

The Yugal Suraksha Plan, also known as the Joint Life Assurance Plan, offered by Postal Life Insurance (PLI), is a specialized insurance solution designed for couples. This plan extends life coverage to both spouses, providing financial security and benefits that are shared between them. 

 

Parameter

Minimum

Maximum

Entry Age (for both spouses)

21 years

45 years

Sum Assured

Rs. 20,000

Rs. 50 Lakhs

Policy Term

5 years to 20 years

 

Loan Facility

Available after 3 years

 

Surrender

After 3 years (if surrendered before 5 years, no bonus is due)

 

Bonus Rate

Rs. 52/- per Rs. 1000 SA per year as of 01.03.2023

 

 

Note: The maximum age of an elder assured should not exceed 60 years at maturity and the age of the couple should be between 21 and 45 years.

 

6. Children Policy (Bal Jeevan Bima)

This scheme is intended for the benefit of the children of people who are insured under the Postal Life Insurance Scheme.

 

Parameter

Minimum

Maximum

Insurance coverage

Eligible for Max 2 children of policyholders

 

Entry Age for child

5 years

20 years

Entry Age for Parent (Policyholder)

 

45 years

Sum Assured

Rs. 20,000

Rs. 3 Lakhs or equivalent to the SA of the parent (whichever is less).

Medical Check-up

Not necessary for the child

 

Loan Facility

Not Available

 

Surrender

Not Available

 

Bonus Rate

Rs. 52/- per Rs. 1000 SA per year as of 01.04.2023

 

 

Note: On the policyholder's death (parent), there is no premium to be paid. The full Sum Assured plus the accrued bonus is paid at the end of the term.

 

Bonus Rates of Postal Life Insurance Scheme 2023-24

Below we have provided the list of the bonus rates of the postal life insurance scheme of 2023-24 that will help you to identify the different bonus rates in different types of plans.

 

Types of Insurance Plan

Bonus Rates of the PLI Scheme

Whole Life Assurance (Suraksha policy)

Rs. 76/- per 1000 SA per year

Convertible Whole Life Assurance (Suvidjha policy)

Rs.76/- per 1,000 SA per annum (whole life insurance premium if not converted into endowment assurance)

Endowment Assurance (Santosh)

Rs. 52/- per 1000 SA per year

Joint Life Assurance (Yugal Suraksha policy)

Rs. 52/- per 1000 SA per year

Anticipated Endowment Assurance (Sumangal policy)

Rs. 48/- per 1000 SA per year

Bal Jeevan Bima – Children Policy

Rs. 52/- per 1000 SA per year

 

Payment Modes of Postal Life Insurance Schemes

Payment modes for the Postal Life Insurance Scheme (PLI) offer flexibility and convenience to its policyholders. Here are the different ways in which premiums can be paid for PLI schemes.

• Post Office Payments: Policyholders can visit any postal office across India to pay their premiums in cash or by cheque. When making cash payments, they receive a stamped acknowledgment in their Premium Receipt Book (PRB), which serves as proof of payment.

• Salary Deduction: For government employees, including Central and State Government staff, defense personnel, and paramilitary forces, there is an option for premium payment through salary deductions. This ensures timely premium payments without manual intervention.

• Online Payments: Policyholders have the convenience of paying their premiums online via the official PLI website's customer portal. Online payment can be done using various methods like credit/debit cards, UPI/BHIM, net banking, and digital wallets. 

• India Post Payments Bank (IPPB) App: The IPPB application facilitates cashless transactions for premium payments. Policyholders can use this mobile application to pay their PLI premiums securely and quickly.

• Gramin Dak Seva using Micro ATM: In rural areas, the Gramin Dak Sewaks provide the facility to pay PLI premiums through Micro ATMs, making the process accessible for those living in remote locations.

 

Eligibility Criteria to Open Postal Life Insurance Scheme

Employees from a diverse range of organizations are eligible for the postal life insurance scheme. Below, we have mentioned the types of organizations whose employees are eligible.

• Government Employees: Individuals working in various government departments employees such as in central or state are eligible.

• Local Bodies: Person employed by municipal corporations, panchayats, and other localized government entities.

• Employees Engaged/ Appointed on a Contract basis by Central/ State Government: Individuals on extendable contracts with federal or state levels.

• Non-government Professionals: Includes Doctors, Engineers, Management Consultants, Chartered Accountants, Architects, Lawyers, and Bankers, who meet certain professional criteria or are registered with official bodies.

• Employees of Listed Companies on NSE & BSE: Employees who are working in the listed companies of NSE or BSE are eligible for this scheme.

 

Documents Required for Postal Life Insurance Scheme

Buying a Postal Life Insurance Scheme (PLI) plan requires certain documentation to verify your identity, age, address, and health status. The following is a list of documents typical for buying a PLI plan.

• Age Proof: Any official document that verifies your date of birth is considered valid age proof such as a Birth certificate, Passport, Aadhar card, or PAN card

• Address Proof: To validate your address, you will need to provide documentation such as an Aadhar Card, Voter ID Card, Rent Agreement (if applicable), Bank Passbook, or Statement with the address.

• Identity Proof: For establishing your identity, you will be required to produce an official ID such as an Aadhar Card, Passport, PAN Card, Driving License, and Government/Defense ID Card.

• Medical Examiner’s Declaration: If your chosen PLI plan requires a medical examination, you'll need a declaration or a certificate from an authorized medical examiner stating the outcome of the medical check-up.

• Certificate by Immediate Supervisor (if applicable): If you are a government employee, your departmental head or immediate supervisor might have to provide a certificate validating your employment and other details as per the PLI criteria.

• Certificate by a DO (Development Officer) FO (Field Officer) or PLI Agent: This is a verification by the authorized PLI representative, who assists in the process of obtaining the insurance

• Declaration of Spouse: If your spouse is included in the insurance plan, or if their health status or other factors are relevant to your PLI plan, a declaration from them may also be needed.

 

How to Buy a Postal Life Insurance Policy?

Postal Life Insurance (PLI) has made it possible for customers to procure insurance policies online. The steps to buy PLI online are straightforward and can be completed in a few easy steps.

Step 1: To start the process, the customer should visit the Postal Life Insurance online portal at pli.indiapost.gov.in.

Step 2: Once reached the homepage, the customer needs to navigate to the "Quote" option within the drop-down menu under "Purchase a Policy."

Step 3: Based on the provided PIN code, the name of the nearest Head Post Office will automatically pop up and the customer needs to fill out the Proposal Form.

Step 4: After completing the form, the customer can proceed to make the initial premium payment which can be shared via email, or the customer can visit the 'initial payment menu' under "Purchase a Policy" to complete the transaction.

Step 5: The next step is to upload the required documents. This is done through the "Document upload" menu, which is also found in the drop-down under "Purchase a Policy" on the Customer Portal.

Step 6: Once the documents are uploaded, the selected Head Post Office will retrieve and review them. 

Step 7: After the Head Post Office has finished processing the application and all checks are completed, they will issue the Policy Bond.

Step 8: The Policy Bond will then be dispatched to the customer via Registered Post.

 

How to Log in to Postal Life Insurance?

If you are new to the Postal Life Insurance scheme and want to access the Customer Portal of India Post, follow this step-by-step guide for a seamless registration and login process.

Registration Steps for the First-time User:

Step 1: Visit the official website of India Post.

Step 2: Click on ‘Register’ and choose ‘Retail.’

Step 3: Enter the required details and click ‘Register.’

Step 4: You will receive an activation link in your registered email address.

Step 5: Click the activation link within 48 hours to activate your account.

 

Login Steps After Successful Registration:

Step 1: Visit the official website of India Post.

Step 2: Click on ‘Sign In’ and select ‘Registered User.’

Step 3: Click on the ‘Forgot Password?’ link.

Step 4: Enter your User ID and click ‘Submit.’

Step 5: Provide the answer to the hint question from your registration and click ‘Submit.’

Step 6: Your registered email ID will receive an OTP. Enter your OTP and your User ID to log in.

Step 7: Select the ‘Change Password’ link at the top of the page.

Step 8: Enter your new password and click ‘Submit.’

 

How to Claim Postal Life Insurance?

Claiming Postal Life Insurance involves a set process that beneficiaries or legal representatives of the insured individual need to follow. Below is the general guide on how to claim Postal Life Insurance.

Step 1: In the event of the policyholder's demise, the first step is to inform the nearest post office where the Postal Life Insurance policy is held. Provide them with the necessary details such as the policy number, date of death, and other relevant information.

Step 2: The nominee or legal representative needs to submit the following documents to the post office Death certificate of the insured, Duly filled and signed claim form, Original policy document (if available), Legal evidence of title if the policy is not nominated.

Step 3: Obtain the claim form from the post office or download it from the official website of India Post. Fill in the required details accurately and sign the form.

Step 4: Provide a copy of the death certificate issued by the relevant authorities and an original policy document. This document serves as proof of the insured individual's demise.

Step 5: Submit the duly filled claim form along with all the required documents to the post office where the policy is registered. The post office will review the submitted documents and process the claim. 

Step 6: Once the claim is approved, the sum assured along with any accrued bonuses will be disbursed to the nominee of the policy.

 

Conclusion

In conclusion, The Postal Life Insurance Scheme, initiated by the Indian Postal Service, is a better investigation option for life insurance, particularly for government and semi-government employees. Offering attractive premium rates and attractive returns, it provides a sense of financial security to policyholders. 

Being a government-backed insurance, it has a lower risk and has earned the trust of a huge consumer base. However, it does face limitations such as a lack of awareness and potentially reduced appeal to private sector employees.


 

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