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Brief History of PLI In 1894, PLI extended insurance cover to female employees of P & T Department at a time when no other insurance company covered female lives.he employees of Telegraph department in 1888. • Introduced on 1st February 1884. • It was initially offered as a welfare scheme for the benefit of Postal employees in 1884. • Extended to the employees of Telegraph department in 1888. • In 1894, PLI extended insurance cover to female employees of P & T Department at a time when no other insurance company covered female lives.
Why Life Insurance? • Social security is a big challenge for human beings since early days. • Life today has become so uncertain. • To make the future safe, one has to think of financial security. • We have many options available in the market to invest money but life insurance is the most profitable amongst these.(Why?)
Why Life Insurance? • Life Insurance has triple benefits. • Insurance (Covers life risk) • Investment (Gives you good return) • Income Tax (You get tax rebate) • Lower the age higher the benefits. • So one must get insured as early as possible.
Life Insurance – How much? • Though there is no specific rule relating to it, however there are some following principles , generally followed by investors. • 1 – Income Principle – It is advised that a person should get himself insured 6 to 8 times of his annual income. • 2 – Income – Expenditure Principle - It is advised that a person should get himself insured 5 times of his annual income plus all recurring annual expenses.
Life Insurance – How much? • 3-Premium - Income percentage principle – It is applicable to very high income group persons. They should invest 6 % of their monthly income as premium of sum insured on them and 1% on each of their dependents. • 4 – Family need principle – A person should get himself insured to the amount that if he dies, the expenses of his family are not effected.
Why PLI ? • Deduction of premium from salary. • Highest bonus and lowest premium in comparison to any other life insurance provider. • Rebate on advance deposits. • Equal premium irrespective of gender and service conditions. • Deposit of premium through cheque. • Pass book facility. • Income tax rebate • Nomination and loan facility.
Postal Life Insurance – Who can buy? Permanent resident of India who are employees of • Central and State Governments • Defense services • GDS employees • Govt. aided educational Institutions • Universities established by Govt. • Local bodies like municipalities , Zilla Parishads • RBI,SBI its subsidiaries • Nationalized banks • Port trusts, central and state govt. undertakings
Continued…. • Employees on contract basis by central/State Govt, where contract is extendable • Employees of joint ventures in which state/central/PSU/Nationalized banks have min holding of 10% • Employees of deemed universities and educational institutions accredited by recognized bodies • Employees of cooperative societies registered with the Government.
Types of policies 1.Whole life assurance (SURAKSHA) Bonus Rs.85/per thousand 2.Convertible whole life assurance (SUVIDHA) Bonus: proportionate Payable only after the death of the policy holder Policy will be in force till the death of the insurant Premium payable up to 55/58/60 years Converted into endowment assurance after 5 years Note- Bonus of EA will be paid from the date of commencement of policy if WLA or CWLA is converted in to EA
3.Endowment Assurance (SANTHOSH) Payable to the insurant after maturity of the policy In case of death, nominee will be paid full amount of the sum assured with accrued bonus Bonus: Rs.60/ per thousand Maturing at the age of 35/40/45/50/55/ 58/60 years
4.Anticipated endowment assurance (SUMANGAL) Benefits paid 15yrs 20yrs policy After 6yrs 8 yrs 20% After 9yrs 12yrs 20% After 12yrs 16yrs 20% After 15yrs 20yrs 40%+bonus It is a money back policy There are two types; 15 years policy 20 years policy Bonus Rs.55/ per thousand Maximum age at entry 40/45 yrs
5.Yugal Suraksha • 1. The sum assured payable at the end of the endowment term or on the death of either of the two lives assured • 2. Bonus Rs60/-per thousand • 3. Only one can have this policy • 4. Spouse should be literate • 5. When added to the age of the proponent the term should not exceed 60 years
6.Children’s policy • This is an add on policy introduced 20.1.2006. • 1. Non-medical policy • 2. The minimum limit is Rs,20,000/ and • maximum is Rs.3,00,000/ • 3. The parent should also have a policy • equivalent to amount of sum assured • of the child • 4. Bonus Rs.60/ per thousand
Children’s policy continued • 5. Child’s age should be between 5 and 20 years • 6. Parent should not be above 45 years • 7. One EA policy per child • 8. Only two children 9. In case of death of insured of main policy before expiry of children’s policy no further premium need be paid
Age conditions Whole life/EA YugalSuraksha AEA Convertible W/L Children’s policy Non-medical Above 5 lakhs Minimum/maximum 19 55 21 45 19 40/45 19 50 Child’s age5-20 Parent’s age 45 19 35 19 50
Conditions continued.. • Policies should be in multiple of Rs.10000/- minimum being Rs.20000/- • Maximum Rs.20 lakh. ( Persons eligible for both PLI and RPLI can get insured for maximum sum of Rs 20 lakhs, out of which not more than Rs 5 lakhs can be under RPLI. • For non-medical –Maximum Rs.1,00,000-/
Rebate • Policies of Rs.20,000/- and above Re 1/- rebate is given in monthly premium. • For yugal Suraksha rebate of Re.1/ is allowed for first Rs.40,000-/ and Re.1-/ for every adl. Rs.10,000/-
Advance premium Rebate for advance premium 12 months: 2% 6 months : 1% 3 months : 0.5% (for RPLI only) YugalSuraksha 12 months :50% of one month’s premium 6 months :10% of one month’s premium 3 months : 2% of one month’s premium
Medical report Medical report is necessary in cases: 1 When age at entry exceeds 35 years 2 When sum assured exceeds 1,00,000/- 3 When policy maturing at the 35 years of age 4 AEA policies
Features continued.. • The validity of the Medical certificate is 60 days • If it is not accepted within that period, second medical examination is to be done
Bonus Whole life policy Rs.85/ per thousand Endowment Assurance Rs.60/ “ Anticipated endowment Rs.55/ “ Yugal Suraksha Rs.60/ “ Children Policy Rs.60/ “
HOW TO CALCULATE PREMIUM? • TRAINER TO GIVE DEMO ON CALCULATION OF PREMIUM FROM THE TABLES. • ALSO GIVE DEMO ON THE CALCULATION OF REBATE ON SUM ASSRUED & REBATE ON ADVANCE DEPOSITS. • PROVIDE TABLES OF PREMIUM CALCULATIONS.
Lapsing and revival • If the policy is less than 3 years old premium can be accepted within 6 months from the date from which first premium was due with interest @12% • If the policy is more than 3 years old, premium can be accepted within 12 months from the date from which first premium was due with interest @12%
Revival • If is not paid within this period revival by competent authority is required
Calculation of interest for defaulted months premuim • Formula: n X (n+1) X premium ------------------------ 200 n= no. of months Or No.of defaults x premium ------------------------- 100
After sale service • 1.Re.2/ fee for duplicate premium receipt book to be credited to UCR • 2.Duplicate Bond • Re 50/ to UCR • Indemnity bond in stamp paper of Rs.100/ • Policy above Rs.500000/ copy of paper notification • 3.Change of mode of payment • 4.Change of Post office • 5.Correction to the bond • 6.Conversion
Continuation premium receipt book • Sub postmasters are authorised to issue continuation PRB • SPMs to obtain blank PRBs from H.O and maintain stock register • The first page entries of old pass book to be copied, like, policy No., Name of the insurant, class & sum assured, monthly rate of premium, date of last installment, date of maturity, premium paid upto, non-credits etc
Loan • Endowment policies ,after 3 years only Whole life policies, after 4 years • Should not have been assigned No loan for AEA policies/children’s policy/Yugal Suraksha
Loan • Exceeding 3 years, but less than 5 years : 60% of surrender value • Exceeding 5 years, but less than 10 years : 80% of surrender value • Exceeding 10 years : 90% of surrender value • Interest @10% per annum compounded half yearly
Surrender • Endowment and whole life policy can be surrendered after 3 years • Children’s policy, after 5 years • Original policy bond • Premium receipt book or pay drawing officer’s certificate • Surrender of policy to be discouraged
Surrender Paid up value=Sum assured X Paid period ------------------------------- Payable period Surrender amount=(Paid up value +Proportionate Bonus) X S.F
Types of claims • Maturity claim • Death claim • Death by suicide: no claim before the policy completes two years from the date of acceptance
Maturity claim • Application in plain paper or prescribed form • Original policy bond • Premium receipt book or pay drawing officer’s certificate • Loan pass book, if any,
Death claim • Documents to be attached with the claim; • Original policy document • Premium receipt book or pay disbursing officer’s certificate for preceding one year • Death certificate • Doctor’s certificate/report who last attended the late insurant • Any other supporting document • IP/ASP’s report • If death is due to accident ,Post mortem report and copy of FIR
Non-medical policies(death claim) • Death occurring within one year: 35% • Above one year but below 2 yrs: 60% • Above 2 years but below 3 yrs : 90% • Above 3 years : full
YOUR ROLE AND BENIFITS • Life Insurance sector has a huge potential in India. • DOP can become a market leader in this field. • PLI/RPLI are the best life insurance options available in the market. • As a Postal worker ,You can contribute not only to the department but can earn a handsome commission on selling PLI/RPLI products.
YOUR ROLE AND BENIFITS • Firstly ask a customer ,what monthly amount he/she is planning to invest in PLI/RPLI. • What are his/her short term and long term goals in. • Suggest suitable policies accordingly. • Never suggest small investor to buy single policy of bigger sum. • Do not hide any information from the customer. • Always provide best after sale services.
RURAL PLI (RPLI) • For Rural people • Whole Life (GRAMA SURAKSHA) • Endow Assurance (GRAMA SANTOSH) • Convertible Whole Life (GRAMA SUVIDHA) • Anticipated endowment assurance (GRAMA SUMANGAL) • Ten years Rural PLI policy (GRAMA PRIYA) • Children’s policy
RPLI-LIMITS Minimum- Rs. 10,000/- Maximum- Rs. 25,000/- (without medical) Rs. 5,00,000/- (on medical) Rs. 1,00,000/- (for non-standard age-proof and above 45 years)
RPLI-AGE LIMIT • Minimum- 19 on next DOB • Maximum: WL and EA 55 CWL and 10 yr Plan 45 AEA 40 • Above 35 years only medical policies • Above 45 policy up to Rs. 1,00,000/
RPLI-AGE LIMIT • Age proof • Standard • Non-standard
RPLI-Non-standard age proof • Horoscope- genuine • Elder’s declaration in the presence of Magistrate on stamped paper • Age of the person given by him and as assessed by Medical Officer whichever is higher
RPLI-Non-standard age proof… • Declaration by proposer before (not on stamp paper) • Secretary or Member of Panchayat • Tahasildar • BDO • 5 % extra premium for non-standard age proof
RPLI • Low Premium with following rate of rebate • Monthly Re.1/- per 20,000/- • Quarterly Rs.3/- -------do---- • Half yearly Rs.6/-------- do---- • Yearly Rs.12/-------do-----
RPLI • Rebate for advance payment of monthly premium - 12 months 2.0% - 06 months 1.0% - 03 months 0.5%
RPLI-after sale service • Loan • Surrender • Revival • Maturity • Claims • Miscellaneous
Loan Loan may be granted on the security of following policies - EA after 3 years - WL after 4 years No loan on AEA, & 10-yr RPLI Insurant to submit dully filled, signed application along with policy bond and PR Book to the BPM. The BPM shall immediately forward all the papers to the Head of Division through account office