Postal Life Insurance Benefits

What is Postal Life Insurance?

Postal Life Insurance, a government-backed insurance plan, started as a welfare scheme providing benefits to postal employees and the oldest life insurance scheme. It later extended its cover to the Telegraph Department employees of the P&T Department. PLI also extended insurance coverage to female employees in 1894. Now, it covers employees of Defense & Para-military services, Central & State Government Employees, Banks, Public sector Undertakings, Local bodies, Educational institutes and professionals like engineers, doctors, chartered accountants, lawyers, MBA, etc. and the company’s employees listed with Bombay Stock Exchange (BSE)/ National Stock Exchange (NSE).

The main objective of this PLI scheme is to make sure the well-being of Indian government employees through sufficient life insurance coverage. With this scheme, they can easily avail of life insurance at a lower premium rate than plans available in the insurance industry.

Similar to Postal Life Insurance (PLI), there is an RPLI i.e., Rural Postal Life Insurance scheme to provide financial benefits to the rural people.

What is Rural Postal Life Insurance (RPLI)

The Postal Department of India introduced the Rural Postal Life Insurance (RPLI) Scheme in 1995 for rural people of India. In 1993, the Malhotra Committee recommended that about 22% of the Indian population had insurance coverage and funds related to life insurance only accounted for 10% of households’ savings. The Indian Government accepted the observations presented by the committee, and then PLI extended its coverage to the rural regions. This is due to the large network of Post Offices in the rural populated area. In addition to this, the operational cost was also low because of this reason. This plan mainly focuses on providing insurance coverage to the weaker sections of society and women working in rural areas. The other objective is to spread awareness regarding insurance among the rural population.

Eligibility Criteria of Postal and Rural Life Insurance Schemes

Benefits of Postal Life Insurance

1. Outstanding Returns

   PLI schemes offer the highest life insurance coverage with a bonus facility that is more than the other insurance.

2. Appointment of a nominee

   Under postal life insurance plans, the primary policyholder can appoint his/her beneficiaries as nominees. These schemes also allow changing the PLI’s nominee during the policy term when needed.

3. Loan Facility

   Policyholders can also take a loan against the PLI Scheme. However, he/she has to wait for 3 policy years to get a loan in case of an endowment assurance plan and 4 years if you have purchased a whole life assurance plan.

4. Conversion of Plan

   Policyholders can easily switch from the whole life assurance plan to the Endowment assurance plan. One can also change the endowment assurance policy to another endowment policy.

5. Policy Revival

   Policyholders can revive a lapsed Postal Life Insurance Plan for Government Employees under the below-mentioned scenarios:

   • A policy that is less than 3 years and lapsed after the 6 successive non-payment of premiums.

   • A policy that is more than 3 years old and is lapsed after 6 successive non-payment of premiums.

6. Issuing Duplicate documents of policy

   Policyholders can get duplicate documents if they misplace/lose/damage the original documents.

7. Income Tax Benefits

   The policyholder can get tax benefits under section 80C of the ITA of up to Rs. 1.5 Lacs on the premium amount paid.

8. Multiple PLI plans

   You have the option to buy more than one plan. However, the total life cover should not be less than Rs. 20,000 and more than Rs. 10 Lakhs.

9. Check payment status

   Policyholders can easily track the premium payments for loan transactions with the passbook facility.

10. Easy mode of payment

    With PLI, you can pay premium amounts at any post office across India through cheque/cash. Premium payment can also be made through POSB accounts through mbanking, ebanking and POSB debit cards.

Points to Remember About Postal and Rural Life Insurance Plans

Following are a few points to consider before buying Postal and Rural Life Insurance Plans:

• Government employees can continue with the PLI scheme even after leaving their job.

• Premium amounts can be payable annually, half-yearly or monthly.

• You have the option to surrender the plan at any time. Whole life insurance plans can be easily surrendered after completing 4 years, and 3 years are required for surrendering endowment plans.

Conclusion

Postal life insurance is specifically designed for government employees are the most common and preferred insurance plan that gives you financial protection in case of a policyholder’s death. However, before buying any life insurance plan, you should always assess your life insurance objectives, compute the coverage you need for your family and choose a comprehensive plan

You may also like to read about : Term Insurance

Note: Check all the best term insurance plan in India.

Note: You should also check the benefits of term life insurance if you are planning to purchase the term insurance plan.