Providing financial security to loved ones is a priority for many and life insurance is an efficient tool to ensure the same. One of the oldest insurance products in the country, postal life insurance is an insurance scheme started in 1884. The scheme now comes under the Department of Posts, Government of India. Known for its cost-effectiveness, the insurance product offers more returns at lesser premiums. Let’s find out more about the scheme and its different types.
Postal Life Insurance Scheme
Initially introduced as an insurance scheme for the employees of the postal service, the PLI scheme is now offered to the employees of the central/state governments, public sector undertakings, nationalised banks, government-aided educational bodies, etc. The features of postal life insurance are as follows:
The Indian postal life insurance provides a maximum sum assured of ₹50 lakhs.
There are tax* exemptions offered under Section 88 of the Income Tax* Act.
In case of an advance premium of 6 months, you can avail of a premium discount of 1% of the value.
A premium discount of 2% of the value is offered if you pay an advance premium of 12 months.
The scheme allows the policyholder to nominate a beneficiary. He/she can also change the beneficiary’s name according to circumstances.
You can also avail of loans under postal life insurance schemes.
In case your policy lapses due to any reason, you can revive it under certain conditions.
You can also convert postal life insurance policy from whole life assurance to endowment assurance or vice versa.
Different Types of Postal Life Insurance
The postal life insurance scheme has six types of policies which are as follows:
- Whole life assurance policy (Suraksha)
A whole life assurance policy offers the assured sum and the accumulated bonus2 after the policyholder reaches the age of 80 or when the insured dies, whichever may happen first.
Age criteria: 19-55 years
Minimum sum assured: ₹20,000
Maximum sum assured: ₹50,00,000
You can avail of loans after the completion of four years.
You can surrender the policy after three years.
You can convert the policy into an endowment policy after one year and before the age of 57 years.
- Endowment assurance policy (Santosh)
Under an endowment policy, the assured sum and the bonus2 are given to the policyholder after a pre-determined maturity age. In case of the death of the insured, the sum goes to the beneficiary or legal heir.
Age criteria: 19-55 years
Minimum sum assured: ₹20,000
Maximum sum assured: ₹50,00,000
You can surrender the policy after three years.
You can convert the policy into any other type of endowment policy as per the terms and conditions of the scheme.
- Convertible whole life insurance policy (Suvidha)
The assured sum and the bonus2 are given to the policyholder after a pre-determined maturity age. In case of the death of the insured, the sum goes to the beneficiary or legal heir.
Age criteria: 19-50 years
Minimum sum assured: ₹20,000
Maximum sum assured: ₹50,00,000
You can avail of loans after the completion of four years.
You can surrender the policy after three years.
You can convert the policy into an endowment policy after five years and before the age of 55 years. If not converted, the policy converts to a whole life assurance by default.
- Anticipated endowment assurance policy (Sumangal)
The policy is a money-back policy that offers a maximum assured amount of ₹50,00,000. It is suitable for people who wish for periodic returns. The periodic payments are not considered if the insured dies, and the complete assured sum and the bonus2 are given to the nominee or legal heir.
The policy with a tenure of 15 years has age criteria of 19-45 years.
The policy with a tenure of 20 years has age criteria of 19-40 years.
The periodical survival benefits for the 15-year tenure policy: 20% of the sum assured paid after six, nine and twelve years. While 40% of the assured sum with a bonus2 is offered on maturity.
Periodical survival benefits for 20-year tenure policy: 20% of the sum assured paid after eight, twelve and sixteen years. While 40% of the sum assured with a bonus2 is offered at maturity.
- Joint life assurance policy (Yugal Suraksha)
This scheme needs any one of the spouses to be eligible for the PLI scheme. Under a joint life assurance policy, both spouses are covered under the sum assured with a single premium.
Minimum sum assured: ₹20,000
Maximum sum assured: ₹50,00,000
You can avail of loans after the completion of three years.
The death benefit is given to either of the survivors if any one spouse dies.
- Children policy (Bal Jeevan Bima)
The scheme is aimed at providing insurance coverage to the policyholder’s children.
Maximum number of children eligible: 2
Age criteria of children: 5-20 years
Age limit of the policyholder: Should not exceed 45 years
- No premium payment is required for Bal Jeevan Bima if the policyholder dies
Note: The above schemes can be availed for physically handicapped individuals also, for which the premiums are determined through a medical examination. Also, you can get a suitable PLI scheme through a postal life insurance agent.
PLI Loan Interest Rate
After completion of the required number of years, the policies under PLI allow you to avail of loans at a PIL interest rate of 10% per annum. This loan interest is calculated on six months basis.
Conclusion
As a breadwinner, you can take care of your loved ones’ needs in your presence.
You can buy a suitable policy if you are not eligible for the postal life insurance plans at affordable prices with Tata AIA. The life insurance company offers multiple insurance plans that ensure the protection of your loved ones’ smiles in your absence.
L&C/Advt/2022/Dec/3399
