Postal life Insurance (PLI) – A Detailed overview

Introduction

Postal Life Insurance (PLI) is a unique and trusted insurance product offered by India Post, a government-backed entity with a rich history of serving the nation. Launched in 1884, PLI has provided financial security and peace of mind to millions of Indians.

Understanding PLI: Combining Tradition with Security

PLI stands out for its affordability and government backing. Unlike private insurance companies, India Post operates with a social welfare motive, offering competitive premiums and attractive returns. This makes PLI an excellent choice for individuals seeking a reliable and cost-effective way to secure their financial future.

Benefits of Choosing PLI:

• Affordable Premiums: PLI boasts some of the lowest premiums in the Indian insurance market. This is due to India Post’s non-profit motive and streamlined operations.
• Government Guaranteed: Backed by the Government of India, PLI offers a high degree of security and stability. Policyholders can be assured that their investments are safe and returns are guaranteed.
• Simple and Transparent: PLI plans are known for their straightforward terms and conditions. The benefits and payouts are clearly outlined, leaving minimal room for ambiguity.
• Extensive Network: With a vast network of post offices across India, especially in rural areas, accessing PLI and availing of its services is convenient and accessible.
• Bonus Additions: Many PLI plans offer bonus additions to the sum assured, further enhancing the overall benefit amount.

Who is Eligible for PLI?

PLI caters to a broad spectrum of individuals, making it a widely accessible insurance option. Here’s a breakdown of the eligibility criteria:

• Central & State Government servants
• Defence and Para-Military Services Employees
• Public Sector Undertakings, Banks Employees
• Educational Institutions, Local Bodies Employees
• professionals (such as doctors, engineers, chartered accountants, MBAs, lawyers etc.) and employees of companies listed with National Stock Exchange (NSE) / Bombay Stock Exchange (BSE)
• All Type of Graduate & Diploma Holders
• ITI Holders

Types of PLI Plans:

India Post offers a variety of PLI plans catering to different needs and risk appetites. Here’s an overview

Endowment Assurance (Santosh)

Under this scheme the proponent is given an assurance to the extent of the sum assured and accrued bonus till he/she attains the pre- determined age of maturity i.e 35,40,45,50,55,58 & 60 years of age.

• In case of death of insurant, assignee, nominee or legal heir is paid full amount of sum assured with accrued bonus
• Minimum & maximum age at entry: 19-55 years
• Minimum sum assured ₹ 20,000; Maximum ₹ 50 lac
• Loan facility after 3 years
• Surrender after 3 years
• Not eligible for bonus if surrendered before completion of 5 years
• Proportionate bonus on reduced sum assured is paid if policy is surrendered after 5 years
• Last declared Bonus- ₹ 52/- per ₹ 1000 sum assured per year

Whole Life Assurance (Suraksha)

This is a scheme where the assured amount with accrued bonus is payable to the insured either on attaining the age of 80 years, or to his/her legal representatives or assignees on death of the insured, whichever occurs earlier, provided the policy is in force on the date of claim.

• Minimum & Maximum age at entry: 19-55 years
• Minimum Sum Assured ₹ 20,000; Maximum ₹ 50 lac
• Loan facility after 4 years
• Surrender after 3 years
• Not eligible for bonus if surrendered before 5 years
• Can be converted into Endowment Assurance Policy upto 59 years of age of the insurant provided the date of conversion does not fall within one year of the date of cessation of premium payment or date of maturity.
• Premium paying age can be opted for as 55,58 or 60 years
• Proportionate bonus on reduced sum assured is paid if policy is surrendered
• Last declared Bonus- ₹ 76/- per ₹ 1000 sum assured per year

​Joint Life Assurance (Yugal Suraksha)

It is a Joint Life Endowment Assurance in which one of the spouses should be eligible for PLI policies.

• Life cover to both spouses to the extent of sum assured with accrued bonus with a single premium
• Minimum sum assured ₹ 20,000; Maximum ₹ 50 lac
• Minimum age & Maximum age at entry of spouses: 21-45 years
• Maximum Age of the elder policy holder should not be more than 45 years & the couple should be between 21 years to 45 years
• Minimum term of policy 5 years and maximum 20 years
• Loan facility after 3 years
• Surrender after 3 years
• Not eligible for bonus if surrendered before completion of 5 years
• Proportionate bonus on reduced sum assured is paid if policy is surrendered
• Death benefits are paid to either of the survivors in the event of death of spouse or main policy holder
• Last declared Bonus- ₹ 52/- per ₹ 1000 sum assured per year

Convertible Whole Life Assurance (Suvidha)

A Whole Life Assurance Policy with the added feature of an option to convert to Endowment Assurance Policy at the end of five years of taking policy.

• Assurance to the extent of sum assured with accrued bonus till attainment of maturity age
• In case of death, assignee, nominee or legal heir paid full amount of sum assured with accrued bonus
• Minimum age & Maximum age at entry: 19-55 years
• Can be converted into Endowment Assurance after 5 years not later than 6 years of taking policy. If not converted, policy will be treated as Whole Life Assurance
• Minimum sum assured ₹ 20,000; Maximum ₹ 50 lac
• Loan facility after 4 years
• Surrender after 3 years
• Not eligible for bonus if surrendered before completion of 5 years
• Last declared Bonus- ₹ 76/- per ₹ 1000 per year (for WLA policy if not converted to Endowment Assurance)
• ​On conversion, bonus of Endowment Assurance will be payable.

Anticipated Endowment Assurance (Sumangal)

It is a Money Back Policy with maximum sum assured of ₹ 50 lacs, best suited to those who need periodical returns. Survival benefits are paid to the insurant periodically. Such payments will not be taken into consideration in the event of unexpected death of the insurant. In such cases, full sum assured with accrued bonus is payable to the assignee, nominee of legal heir.

• Policy term: 15 years and 20 years
• Minimum age 19 years; maximum age at entry 40 years for 20 years’ term policy & 45 years for 15 years’ term policy
• Survival benefits paid periodically as under: –
• 15 years Policy- 20% each on completion of 6 years, 9 years & 12 years and 40% with accrued bonus on maturity
• 20 years Policy- 20% each on completion of 8 years, 12 years & 16 years and 40% with accrued bonus on maturity
• ​Last declared Bonus- ₹ 48/- per ₹ 1000 sum assured per year

Children Policy (Bal Jeevan Bima)

The salient features of this scheme are as under:

• ​The scheme provides life insurance cover to children of policy holders
• Maximum two children of policy holder (parent) are eligible
• Children between 5- 20 years of age are eligible
• Maximum sum assured ₹ 3 lac or equal to the sum assured of the parent, whichever is less
• Policy holder (parent) should not be over 45 years of age.
• No premium to be paid on the Children Policy, on the death of policy holder (parent). Full sum assured and bonus accrued shall be paid on completion of term
• Policy holder (parent) shall be responsible for payment of Children policy No loan admissible
• Has facility for making it paid up, provided premiums are paid continuously for 5 years
• Surrender facility is not available
• No medical examination of child necessary. However, child should be healthy and risk shall start from day of acceptance of proposal
• Attract the rate of bonus applicable for Endowment policy (Santosh) i.e. last bonus rate is ₹ 52/- per ₹ 1000 sum assured per year

Premium Calculation

• Download Postinfo application from play store for premium calculation

Maturity Calculation

• Download Postinfo application from play store for Maturity calculation

Important Forms

1. PLI Proposal form

Click here to Download Other Forms

How to get PLI:

Applying for PLI is a straightforward process:

1. Visit a Post Office: Head to your nearest post office  or visit pli.indiapost.gov.in
2. Choose Your Plan: Discuss your needs and risk profile with a postal representative to choose the most suitable PLI plan.
3. Collect Forms: Obtain the application form for your chosen plan and fill it out accurately.
4. Submit Documents: Along with the completed form, submit necessary documents like Pan Card, Aadhaar card, salary slip (for employees) or Graduation/Diploma certificate for other category. You may also need to undergo a medical checkup depending on the plan and sum assured.
5. Pay Premiums: Pay the premium in cash. Premiums can be paid monthly, quarterly, half-yearly, or annually.

Additional Points to Consider:

• Policy Term: Carefully consider the policy term that aligns with your financial goals and life stage.
• Sum Assured: Choose a sum assured that provides adequate financial protection for your dependents in case of your demise.
• Bonus Additions: Many PLI plans offer bonus additions that can significantly increase the maturity payout. Understand the bonus structure before choosing a plan.
• Claim Process: Familiarize yourself with the claim process in case of policy maturity or death of the policyholder.

Conclusion:

Postal Life Insurance (PLI) stands as a beacon of financial security and stability in the lives of millions of Indians. With its affordable premiums, flexible coverage options, and attractive benefits, PLI serves as a trusted companion on the journey towards a secure future. As a cornerstone of the Indian Postal Service, PLI embodies the values of trust, reliability, and inclusivity, ensuring that every individual has the opportunity to protect their loved ones and build a legacy of financial prosperity.