Postal Life Insurance: Benefits, Eligibility & Apply

Postal Life Insurance (PLI) is a government-backed life insurance policy in India, established in 1884. It was originally designed for postal service employees but has now expanded to cover a wide range of individuals, including government employees, members of various sectors and professionals.  

PLI offers you affordable and budget-friendly premiums and attractive returns, making it an appealing option for those seeking financial security for their loved ones. Additionally, PLI has adjusted to modern trends as more individuals choose online insurance services, making it simple to buy policy online at the convenience of your home.  

Types of Postal Life Insurance Plans 

PLI offers several types of life insurance plans to meet your diverse needs. This includes: 

1. Whole Life Assurance (Suraksha) 

This scheme offers an assured amount that is payable upon the death of the policyholder. The amount will be given to the nominees of the life insured (policyholder). Moreover, this plan also has an element of savings to it. If the policyholder reaches the age of 80, they will receive the assured amount alongside any accrued bonuses. This offers the policyholder financial security during their twilight years.  

Key Features: 

• Age Eligibility: The minimum entry age is 19 years, and the maximum is 55 years. 

• Sum Assured: Policies can be taken out with a minimum sum assured of ₹20,000 and a maximum of ₹50 lakh. 

• Loan Facility: After four years, policyholders can access a loan against their policy. 

• Surrender Option: Policies can be surrendered after three years. However, if surrendered before five years, the policyholder will not be eligible for any bonuses. 

• Conversion Option: The policy can be converted into an Endowment Assurance Policy until the insured turns 59, provided the conversion occurs more than one year after premium payments cease or after maturity. 

• Premium Payment Age: Policyholders can choose to pay premiums until they are 55, 58, or 60 years old. 

• Bonus Structure: If a policy is surrendered, a proportionate bonus based on the reduced sum assured will be paid out. The last declared bonus was ₹76 per ₹1,000 sum assured per year. 

2. Convertible Whole Life Assurance (Suvidha) 

This Whole Life Assurance Policy offers you a unique option to convert to an Endowment Assurance Policy after five years. 

Key Features: 

• Provides sum assured with accrued bonus until you reach maturity. 

• In case of death, the nominee or legal heir receives the full sum assured with a bonus. 

• Entry age is 19-50 years. 

• Conversion to endowment assurance is available between 5 to 6 years. If not converted, the policy remains Whole Life Assurance. 

• The minimum sum assured is ₹20,000, and the maximum is ₹50 lakh. 

• Loan facility available after 4 years. 

• Surrender is allowed after 3 years (no bonus if surrendered before 5 years). 

• The last declared bonus is ₹76 per ₹1000 annually (for Whole Life Assurance, if not converted). 

• Note that once you’ve done the conversion, the Endowment Assurance bonus applies. 

3. Endowment Assurance (Santosh)

This scheme guarantees the sum assured along with accrued bonuses, payable until the insured reaches a predetermined maturity age of 35, 40, 45, 50, 55, 58, or 60 years. 

Key Features: 

• In the event of the insured's death, the full sum assured and accrued bonuses are paid to the nominee or legal heir. 

• The age limit is 19 to 55 years. 

• The loan facility is accessible after three years. 

• The sum assured is a minimum of ₹20,000 and a maximum of ₹50 lakh. 

• Policies can be surrendered after three years. However, no bonuses are paid if you surrender before five years. If surrendered after five years, a proportionate bonus based on the reduced sum assured will be provided to you. 

• The last declared bonus was ₹52 per ₹1,000 sum assured per year. 

 

4. Anticipated Endowment Assurance (Sumangal) 

It is a money-back policy that provides you with periodic survival benefits before maturity. This money-back policy is ideal for those seeking periodic returns, with a maximum sum assured of ₹50 lakh.  

Key Features: 

• Policy Terms: Available in 15-year and 20-year options. 

• Age Eligibility: Minimum age of 19 years; maximum entry age is 40 for the 20-year term and 45 for the 15-year term. 

• 15-Year Policy: 20% payout after 6, 9, and 12 years, plus 40% with accrued bonuses at maturity. 

• 20-Year Policy: 20% payout after 8, 12, and 16 years, plus 40% with accrued bonuses at maturity. 

• Bonus Structure: The last declared bonus was ₹48 per ₹1,000 sum assured per year. 

5. Joint Life Assurance (Yugal Suraksha) 

This Joint Life Endowment Assurance policy is designed for couples, where at least one spouse must be eligible for Postal Life Insurance (PLI) policies. It provides life coverage for both spouses, along with accrued bonuses, all under a single premium. 

Key Features: 

• Coverage: Life cover for both spouses up to the sum assured, with accrued bonuses. 

• Sum Assured: Minimum of ₹20,000 and a maximum of ₹50 lakh. 

• Age Eligibility: Both spouses must be between 21 and 45 years old, with the older spouse not exceeding 45 years. 

• Policy Term: Minimum of 5 years and a maximum of 20 years. 

• Loan Facility: Available after three years. 

• Surrender Option: Policies can be surrendered after three years. However, no bonuses will be paid if surrendered before five years. A proportionate bonus based on the reduced sum assured will be paid if surrendered afterwards. 

• Death Benefits: In the event of the death of either spouse or the main policyholder, the death benefit is paid to the surviving spouse. 

• Bonus Structure: The last declared bonus was ₹52 per ₹1,000 sum assured per year. 

6. Children’s Policies 

This policy is designed specifically for the financial security of children. 

Key Features: 

• Coverage for Children: Provides life insurance coverage for up to two children of the policyholder. 

• Age Eligibility: Children aged between 5 and 20 years can be insured. 

• Sum Assured: Maximum coverage is ₹3 lakh or equal to the parent’s sum assured, whichever is lower. 

• Parent's Age Limit: The policyholder (parent) must be 45 years or younger. 

• Premium Waiver: No premiums are required for the children's policy if the parent passes away. The full sum assured and accrued bonuses will be paid upon term completion. 

• Payment Responsibility: The parent is responsible for premium payments on the children's policy. 

• No Surrender Option: Surrendering the policy is not allowed. 

• No Medical Exam Required: Children do not need a medical examination, but they must be in good health. Coverage starts from the day the proposal is accepted. 

• Bonus Rate: Attracts the same bonus rate as the Endowment Policy (Santosh), with the last declared bonus at ₹52 per ₹1,000 sum assured per year. 

Benefits of Postal Life Insurance 

     1. Affordable Premiums 

Postal Life Insurance (PLI) offers competitive rates that make it a more affordable option compared to many private life insurance policies. 

     2. High Returns 

PLI policies often provide higher returns on investment due to government backing and efficient management. 

     3. Tax Benefits 

Premiums paid are eligible for deductions under Section 80C of the Income Tax Act, helping policyholders save on taxes. 

    4. Easy Claim Settlement 

Known for its high claim settlement ratio and streamlined processes, PLI ensures timely payouts to beneficiaries. 

    5. Flexible Payment Options 

Policyholders can choose from various premium payment modes, such as, monthly, semi-annually, or annually. 

Eligibility Criteria for PLI 

The eligibility for PLI varies by plan, but the general guidelines include the following: 

• The age requirement ranges from 19 to 55 years, depending on the specific policy you’ve chosen. 

• You must be an employee of the central or state government, public sector undertaking, or professional in recognised fields such as engineering or medicine. 

• You must meet specific residency criteria, especially if you're opting for a rural plan. 

How to Apply for Postal Life Insurance? 

Follow these simple steps to register yourself under the PLI: 

• First, visit the official website of Indian Post and go to the customer portal. 

• Choose your desired plan after you’ve carefully read its features and benefits. 

• Fill out the proposal form by providing your personal details, including employment information and health history. 

• Submit all the required documents. This may include your address proof, identity proof, and income details. 

• Submit the form to receive your Customer ID via email. 

• Pay the initial premium. Use multiple payment options, including post office counters. Additionally, check salary slips regularly for premium deductions if paid through salary. 

• Ensure a nominee is registered and updated in your policy schedule. 

• Complete verification. You can visit your nearest post office with your proposal printout and documents for verification. 

Postal Life Insurance vs. Private Life Insurance 

Feature	Postal Life Insurance (PLI)	Private Life Insurance
Backing	Government-backed	Private companies
Claim Settlement Ratio	High	Varies; some may be lower
Premiums	Generally lower	Varies widely
Tax Benefits	Available under Section 80C of the Income Tax Act	Available under similar provisions
Policy Options	Limited options	Wide range of customised options

Final Thoughts 

Postal Life Insurance policy offers you a compelling option if you’re seeking reliable life insurance coverage at affordable rates. As you consider your insurance options, don’t forget to assess your personal circumstances and financial goals carefully. Make sure to choose a plan that aligns with your long-term needs and provides the financial security you deserve.