The Postal Life Insurance (PLI) scheme is one of the oldest and most trusted insurance schemes in India, introduced on 1st February 1884. Initially aimed at providing insurance to postal department employees, it has now expanded its coverage to other government and semi-government employees and professionals in various sectors. The PLI scheme is known for its low premium rates and high returns, making it an attractive option for many. This article delves into the details of postal life insurance, covering its meaning, eligibility, features, benefits, types, bonus rates, premium payment options, application process, claim settlement, and essential things to know about the scheme.
What is postal life insurance?
Postal life insurance is a government-backed life insurance scheme offered by India Post. The scheme provides life insurance coverage to individuals, ensuring financial security for their families in the event of the policyholder's death. PLI is renowned for its low premium rates compared to other insurance schemes in the market, owing to its not-for-profit nature. The scheme also offers high returns, making it a lucrative investment option. The primary objective of postal life insurance is to encourage savings among government employees and provide them with a reliable source of financial protection.
Eligibility criteria for postal life insurance
Following are the eligibility criteria for getting postal life insurance:
Government and semi-government employees:
Employees of central and state governments, defense services, paramilitary forces, and government-aided educational institutions.
Public sector employees:
Employees of public sector undertakings and financial institutions.
Professionals:
Doctors, engineers, chartered accountants, and employees of cooperative societies.
Educational institutions:
Employees of government-recognised educational institutions, both teaching and non-teaching staff.
Others:
Specific individuals as approved by the Department of Posts.
Features of postal life insurance
Following are the features offered on postal life insurance:
Low premium rates:
PLI offers some of the lowest premium rates in the insurance market.
High returns:
The scheme provides attractive returns with high bonus rates.
Multiple policy options:
Various plans are available to suit different needs and preferences.
Loan facility:
Policyholders can avail loans against their policy after a certain period.
Surrender value:
Policies can be surrendered after a minimum period, with a guaranteed surrender value.
Premium payment flexibility:
Multiple premium payment options are available, including monthly, quarterly, half-yearly, and yearly modes.
Tax benefits:
Premiums paid under PLI are eligible for tax deductions under Section 80C of the Income Tax Act.
Benefits of postal life insurance
Following are the key benefits offered on postal life insurance:
Financial security:
Ensures financial protection for the policyholder's family.
Attractive returns:
High bonus rates result in significant returns on investment.
Loan against policy:
Easy access to loans against the policy, providing financial flexibility.
Flexible premium payment:
Multiple payment options make it convenient for policyholders.
Tax savings:
Premiums paid are eligible for tax deductions, reducing the overall tax burden.
Surrender value:
Guaranteed surrender value if the policy is discontinued after a minimum period.
Types of postal life insurance
Following are the various types of postal life insurance plans you can choose from:
Whole Life Assurance (Suraksha):
Provides life cover throughout the policyholder's lifetime, with payment to the nominee upon death.
Endowment Assurance (Santosh):
Combines life cover with savings, paying the sum assured along with bonuses either on maturity or death.
Convertible Whole Life Assurance (Suvidha):
Initially a whole life policy that can be converted into an endowment policy after 5 years.
Anticipated Endowment Assurance (Sumangal):
A money-back policy offering periodic returns and a lump sum on maturity or death.
Joint Life Endowment Assurance (Yugal Suraksha):
Covers both spouses under a single policy, providing a payout on the first death and continued coverage for the survivor.
Children Policy (Bal Jeevan Bima):
Provides life cover for children aged 5 to 20 years, with the sum assured paid on maturity or death.
Rural Postal Life Insurance (RPLI):
Tailored for rural populations, offering similar benefits to PLI with additional focus on rural needs.
Bonus rates on postal life insurance
Following are the bonus rates you get on postal life insurance:
Whole Life Assurance:
High bonus rates, ensuring substantial returns.
Endowment Assurance:
Attractive bonus rates contributing to significant maturity benefits.
Anticipated Endowment Assurance:
Periodic bonuses in addition to survival benefits.
Convertible Whole Life Assurance:
Bonus rates applicable post-conversion to endowment policy.
Options of premium payments for postal life insurance
You can pay the premium for postal life insurance in following periods:
Monthly:
Convenient for those who prefer smaller, regular payments.
Quarterly:
Balanced option for managing premium payments.
Half-yearly:
Less frequent payments, suitable for those with semi-annual income cycles.
Yearly:
Ideal for those who prefer annual payments, often resulting in a lower total premium due to discounts.
How to get postal life insurance?
Here is a guide to apply for postal life insurance
Visit post office:
Visit the nearest post office and inquire about PLI.
Fill application form:
Complete the application form with required details.
Submit documents:
Provide necessary documents, including proof of age, identity, and income.
Medical examination:
Undergo a medical examination, if required, based on the sum assured.
Policy issuance:
Upon approval, the policy will be issued, and the first premium payment can be made.
What is the claim settlement process of postal life insurance?
Here is the claim process for postal life insurance:
Intimation:
Inform the post office about the death of the policyholder.
Claim form:
Fill out the claim form with necessary details.
Submit documents:
Provide required documents, including the death certificate and policy bond.
Verification:
The post office will verify the details and process the claim.
Disbursement:
The claim amount will be disbursed to the nominee or legal heir.
Things to know about postal life insurance
Here are some factors to know about postal life insurance:
Policy revival:
Lapsed policies can be revived within a specified period.
Nomination facility:
Nomination can be changed anytime during the policy term.
Assignment:
Policies can be assigned to secure loans.
Policy transfer:
Policies can be transferred from one post office to another.
Digital services:
Online postal life insurance services are available for policy management and premium payments.
Grievance redressal:
A robust mechanism is in place for addressing policyholder grievances.
Conclusion
Postal life insurance is a reliable and beneficial scheme offering comprehensive coverage, attractive returns, and flexible options. It caters to a wide range of individuals, ensuring financial security and peace of mind. With its low premium rates, high bonuses, and government backing, PLI remains a preferred choice for many in India. Whether you are a government employee, a professional, or living in rural areas, postal life insurance provides a valuable financial safety net for you and your family. Understanding the various aspects of PLI, from eligibility and features to claims and benefits, can help you make an informed decision and secure your financial future effectively.
