Postal Life Insurance (PLI) Policy: Eligibility, Benefits, Premium Calculator, Bonus Rate, Types

Want to buy a Postal Life Insurance (PLI) policy? If you are searching for life insurance, apart from the private companies, you should also check the offerings by public sector insurance providers. For instance, do you know that the Postal Life Insurance (PLI) is the oldest life insurance provider in India? While a large number of private insurers have cropped up in the last decade or so, PLI has been offering life insurance since 1884.

Postal Life Insurance has started its operations on 1st February 1884 after receiving an express approval from the Secretary of State for India under the regime of British Monarch, Queen Victoria. Apart from being the first life insurance provider in the country, PLI is also the first insurer to cover female employees of the P&T (Posts and Telegraphs) department which it has been doing since 1894.

From just a few hundred policies when it was initially launched to more than 6 million policyholders in the 21st century, PLI has significantly grown in popularity over the years. Currently, there are six different Postal Life Insurance plans that come with a host of features and benefits. The insurance products by PLI range from whole life insurance policy, endowment assurance policy, to child cover.

So, who is eligible for PLI? What are the features and benefits of Postal Life Insurance? What are the different insurance products offered by PLI? Continue reading to find answers to all of these and much more.

postal life insurance pli policy

Postal Life Insurance Eligibility

PLI was actually established to offer life insurance to postal employees in 1884. In 1888, PLI extended the coverage to also include employees of the telegraph department. Then in 1894, the scope was further extended to also cover the female employees of the P&T department. Until 1894, there was no life insurance policy for women in India.

Over the years, the PLI coverage has extended by leaps and bounds. Postal life insurance for government employees is now available for several State and Central Government employees. Moreover, a wide range of people from public sector organizations and institutions can also purchase Postal Life Insurance.

Currently, PLI is available for employees of-

  • State Government
  • Central Government
  • Defense Services
  • Para Military Forces
  • RBI
  • Nationalized Banks
  • Public Sector Undertakings
  • Autonomous Bodies
  • Deemed Universities
  • Education Institutions (Government-Aided)
  • Medical Council of India, Nursing Council of India, Dental Council of India, and the Pharmacy Council of India
  • Joint Ventures which have a minimum of 10% stake of the State/Central Government/PSUs
  • Government-registered Credit Co-Operative Societies and other Co-Operative Societies (Under Co-Operative Societies Act)
  • Private Schools/Institutions/Colleges affiliated to Centre/State Government boards
  • Professionals like Doctors, Engineers, CAs, Management Consultants, Bankers, etc.
  • Banking and Finance, IT, Energy/Power, Healthcare/Pharma, etc. sector companies which are listed on the NSE or BSE where the employees have Gratuity/Provident Fund or have their leave records managed by the company

Features and Benefits of Postal Life Insurance

If you are looking for life insurance, you’d surely be interested in knowing the features and benefits offered by the insurer. Postal Life Insurance offers a number of valuable features and benefits to the policyholders. Some of the top benefits include-

  • As compared to the premium of life insurance policies by most insurance providers in India, the premium for PLI policies is the lowest. But the policies still offer the highest coverage for the premium amount.
  • Even the bonus rates are one of the highest in the insurance industry.
  • Policyholders can also take a loan against their life insurance policy. However, the loan is only available after successful payment of premiums for a fixed For Whole Life Insurance policy, this duration is 4 years and for the Endowment Assurance Plan, it is 3 years.
  • Moreover, the policy can also be assigned to a financial institution for taking a loan.
  • Policyholders also get the conversion benefit with some of the policies. For instance, you can convert Whole Life Insurance into Endowment Assurance Plan.
  • Policy nominee can be easily changed at any time.
  • Policy revival any time in case if a policy
  • Tax benefits under Section 80C of the IT
  • Premium discount in case of advance premium payment.
  • Monthly, bi-annual and annual premium payment options.

Postal Life Insurance (PLI) Bonus Rate

If you are new to life insurance policies, you might not know what the bonus rate of the policies means. The bonus in terms of life insurance policies is the additional amount that the insurer will offer above the coverage amount of the policy.

Life insurance companies are required to distribute some part of its surplus to the policyholders. It is through this bonus that they distribute the additional profits. All the six insurance policies offered by PLI have this bonus facility. For instance, the Whole Life Insurance policy’s last declared bonus was Rs. 85 per Rs. 1,000 sum assured in a year. The same for the Anticipated Endowment Plan is Rs. 53 per Rs. 1,000 sum assured in a year.

Postal Life Insurance Policy Types

As mentioned above, PLI currently offers six different insurance policies. Let us have a detailed look at these policies-

  1. Suraksha Postal Life Insurance (Whole Life Insurance)

With the Suraksha or Whole Life Insurance of PLI, the insured amount and the accrued bonus is given to the nominee, legal heir, or assignee after the death of the policyholder.

  • Policy Conversion: This policy can also be converted to the Endowment Insurance of PLI after paying the premium for a year. But the age of the policyholder should not be more than 57 years.
  • Minimum and Maximum Sum Assured: The minimum cover is Rs. 20,000 and the maximum is 50 lakhs.
  • Age Eligibility: Anyone between the age of 19 and 55 can purchase this policy.
  • Loan Facility: After successfully completing 4 years.
  • Last Declared Bonus: 85 per Rs. 1,000 assured sum in a year.
  1. Santosh Postal Life Insurance(Endowment Insurance)

With the Santosh or Endowment Plan, the insured amount along with the accrued bonus is given to the proponent once he/she reaches a pre-determined maturity age.

  • Policy Conversion: This policy can also be converted to the Endowment Insurance of PLI.
  • Minimum and Maximum Sum Assured: The minimum cover is Rs. 20,000 and the maximum is 50 lakhs.
  • Age Eligibility: Anyone between the age of 19 and 55 can purchase this policy.
  • Loan Facility: After successfully completing 3 years.
  • Last Declared Bonus: 58 per Rs. 1,000 assured sum in a year.
  1. Suvidha Postal Life Insurance (Convertible Whole Life Insurance)

The Suvidha or Convertible Whole Life Insurance provides the conversion benefit along with being a whole life insurance. Upon the demise of the insured, the nominee is given the insured amount along with the accrued benefit.

  • Policy Conversion: This policy can also be converted to the Endowment Insurance of PLI after completing 5 years.
  • Minimum and Maximum Sum Assured: The minimum cover is Rs. 20,000 and the maximum is 50 lakhs.
  • Age Eligibility: Anyone between the age of 19 and 55 can purchase this policy.
  • Loan Facility: After successfully completing 3 years.
  • Last Declared Bonus: 58 per Rs. 1,000 assured sum in a year if the policy is not converted to Endowment Insurance.
  1. Sumangal Postal Life Insurance (Anticipated Endowment Assurance)

If you are looking for an insurance policy which offers periodic returns, Sumangal or Anticipated Endowment Assurance from PIL can be a great choice. The policy gives 20% of the assured sum after completing 6 years, 20% after completing 9 years, 20% after completing 12 years, and 40% of the assured sum as well as an accrued bonus after completing 15 years for the 15-year term policy.

This policy is also available with a 2 years term. In case if the insured person dies when the policy is still active, the insured sum and accrued bonus will be paid to the nominee.

  • Maximum Sum Assured: 50 lakhs.
  • Age Eligibility: Minimum age for this policy is 19 years. Maximum age for 15 years term policy is 45 and for 20 years term policy is 40 years.
  • Last Declared Bonus: 53 per Rs. 1,000 assured sum in a year.
  1. Yugal Suraksha Postal Life Insurance (Joint Life Assurance)

If one of the spouses is eligible for a PLI policy, the Yugal Suraksha or Joint Life Insurance can be purchased for the married couple. It covers both the spouses and requires you to pay a single premium. Upon the death of the insured, the insured amount and accrued bonus are paid to the nominee.

  • Policy Conversion: This policy can also be converted to the Endowment Insurance of PLI.
  • Minimum and Maximum Sum Assured: The minimum cover is Rs. 20,000 and the maximum is 50 lakhs.
  • Age Eligibility: Spouses between the age of 21 and 45 can purchase this policy.
  • Loan Facility: After successfully completing 3 years.
  • Last Declared Bonus: 58 per Rs. 1,000 assured sum in a year.
  1. Bal Jeevan Bima Postal Life Insurance (Children Policy)

The Bal Jeevan Bima or Children’s Policy provides life insurance coverage to the children of a policyholder. Up to 2 children’s of the policyholder are eligible under this policy.

  • Maximum Sum Assured: 3 lakhs or the sum equal to the assured sum of the parent, whichever is less
  • Age Eligibility: Parent (policyholder) should not be more than 45 years and the age of the children should be between 5 years to 20 years.
  • Loan Facility: This policy does not have a loan facility.
  • Last Declared Bonus: 58 per Rs. 1,000 assured sum in a year (similar to Endowment Policy).

Postal Life Insurance PLI Premium Calculator

There are mow online premium calculators which you can use for calculating the premium of any of the policies from PLI. By simply entering the age of the policyholder, type of policy, the assured sum, and some other details, one can easily find the exact premium that needs to be paid.

The calculator eliminates the need for you to get into manual calculations that are not only confusing but highly prone to errors too.

Conclusion: Is Postal Life Insurance (PLI) Good?

As you can see, the insurance products offered by the PLI come with great benefits and are one of the most affordable in terms of premium payments. If you are eligible for PLI policies, you should definitely try to know more about the offerings if you are looking to purchase a life insurance.

Compare the benefits with the policies offered by other public and private insurers to make the right selection.

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