What is the Postal Life Insurance (PLI) Interest Rate on Loans?

Table of Content

• What is the Postal Life Insurance Scheme?
• Postal Life Insurance Plan Details
• Rural Postal Life Insurance
• PLI Interest Rate 2022
• PLI Interest Rate Calculator
• Who is Eligible to Avail Loan Under PLI Scheme?
• Benefits of Availing Loan Under PLI Insurance Scheme

All about Postal Life Insurance and the interest rate at which it allows loan facility to its policyholders.

The Government of India issues several financial plans every year to benefit its employees. Life insurance is one of the most important of such financial products. With a view to providing financial protection to the employees of the Indian Post Office, Postal Life Insurance (PLI) was initiated. The scheme was slowly expanded to cover other Central Government employees and to offer insurance benefits to their respective families. In addition, PLI offers the extended benefit of loan facility to its employees at a decent interest rate.

Here we look into more details on PLI and the interest rate it offers on loans to its policyholders. Read on.

What is the Postal Life Insurance Scheme?

The PLI scheme was initiated by the government of India to offer life insurance protection to the employees of the Indian Post Office as well as other government and semi-government employees and professionals associated with the Indian government.

Life insurance benefits are made available under this scheme in addition to a loan facility against the sum assured. The loan facility provided under the PLI is provided against a percentage of the insured sum amount offered under life insurance. This loan helps the policyholder take care of any emergencies in the short term.

Postal Life Insurance Plan Details

Here are some of the key features offered by PLI plans:

• A total of 6 plans are available under PLI and Rural PLI insurance schemes.
• The plans are extremely affordable for the benefit of its policyholders.
• The sum assured is relatively higher than other plans and the premium charged is quite low.
• Children are also covered under PLI and RPLI plans.
• The upper limit of a life insurance plan under PLI has increased from Rs. 4,000 at the time of scheme initiation to Rs. 10,00,000 now.
• PLI offers smooth and hassle-free claim settlement for all types of claims.
• A bonus is also provided to the policyholder over the base sum assured guaranteed under the policy.

Rural Postal Life Insurance

Rural Postal Life Insurance, popularly referred to as RPLI, was a scheme initiated by the Indian Postal Department in 1995. The scheme was the government’s way of providing life insurance protection to the rural parts of the country where life insurance benefits haven’t reached adequately.

The scheme was introduced keeping in mind the extensive reach of post offices in rural areas through which reaching out to people with insurance would be easier.

PLI Interest Rate 2022

The PLI scheme introduced for government employees also provides the special benefit of loan facility to help policyholders take care of short-term financial contingencies. However, the loan facility is available to the policyholder only after 3-4 years of buying the policy.

This loan amount can be availed at an interest rate of 10% p.a. for a period of 6 months. This means that the postal PLI interest rate on the loan amount is paid every 6 months. In case of failure in timely payment of interest by the policyholder, the pending interest amount gets added on to the outstanding loan. Also, the PLI rate of interest will then depend on the total outstanding loan.

In case of an untimely payment of PLI loan interest rate by the policyholder 3 times in succession, the PLI scheme for the policyholder will be surrendered by the insurer. The surrender value of the plan will then be used by the insurer to pay off all pending interest amounts as well as the outstanding loan amount. The policyholder would not be entitled to any benefits from the PLI scheme after the plan’s surrender.

PLI Interest Rate Calculator

The interest rate calculator for PLI is designed to assist the policyholder in computing the total premium amount payable towards the policy. The premium amount generated by the PLI interest rate calculator includes the current rate of GST payable as well. Besides this, the premium payable can be computed for monthly, quarterly, half-yearly, or annually on the calculator. This can be done by entering details such as the age of the policyholder, the total sum assured under the plan, and the term of the policy.

Who is Eligible to Avail Loan Under PLI Scheme?

PLI offers loan facility to its policyholders under the following eligibility conditions:

• A total of two loans can be availed by the policyholder. The decision in this case lies entirely with the insurer.
• To apply for a loan against endowment and joint life insurance, the policyholder must have completed a minimum of 3 years of plan purchase.
• Loan against whole life and convertible whole life assurance can be availed only after a minimum period of 4 years.
• The PLI loan can be availed up to a maximum of a predetermined part of the surrender value determined at the time of policy purchase. The total amount of loan availed must not be lower than Rs. 1,000.

Read More: Premium Calculator Of Postal Life Insurance (PLI) and Rural Postal Life Insurance (RPLI) Plans 

Benefits of Availing Loan Under PLI Insurance Scheme

Here are some of the prime advantages of taking loan against PLI:

• Since one already is covered under PLI insurance scheme, it becomes easier for them to avail the loan facility offered under the scheme as against applying for loan elsewhere.
• The interest rate offered on the loan under PLI is extremely affordable compared to other lenders. This is because PLI and RPLI schemes are targeted at the economically weaker sections of the society.
• The entire loan-availing process is rather simple and hassle-free for the policyholder.
• The loan can be utilized to manage any short-term financial shortages.

Summing Up

PLI loan facility is one of the major highlights of the insurance plan, helping the government employees and professionals to take care of their financial needs adequately. The interest rate is fairly decent and affordable too. If you wish to calculate the current rate of interest on PLI loans, visit PayBima online and use the PLI interest rate calculator. For best deals on all kinds of insurance, do go through the website.

Found this post informational? Browse PayBima Blogs to read interesting posts related to Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment section. You can visit PayBima to Buy Insurance Online.

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How to Claim Car Insurance for Own Damage?

Table of Content

• What is Own Damage Insurance for Car?
• Claim Car Insurance for Own Damage
• Documents Required for Filing the Claim
• Basic Own Damage Premium in Car Insurance?

Accidents can happen anywhere, anytime, by your own fault or another person. What’s important is to be prepared for such mishaps. This is where Own Damage Car Insurance comes in handy.

The whole purpose of buying car insurance is to safeguard your car against all uncertainties. Accident is definitely one of the biggest uncertainties in this case, which has no time, no place. The damage caused is inevitable, sometimes to your own self or vehicle, while on other times to third-party persons or property. Basic motor insurance plans generally cover third-party liability, meaning any damage caused to the third-party vehicle, person, or property is covered by the insurance company. However, there is yet another feature in car insurance, namely own damage car insurance. Let us learn more about it in this blog.

What is Own Damage Insurance for Car?

As the name suggests, an own damage car insurance policy refers to a plan that provides cost coverage for any damage caused to the policyholder’s own vehicle. This may be attributed to man-made damage, such as the one caused during an accident between two cars, or natural calamity like earthquake, flood, and the like.

In any of the above events, sufficient damage may be caused to the vehicle of the insured. With the own damage insurance for a car, the repair cost for this damage is covered by the insurer for the policyholder.

Claim Car Insurance for Own Damage

In case of own damage to the policyholder’s car, the very first step is to report the incident and the subsequent damage to the insurance company at the earliest. In case the damage has been caused due to an accident, it is necessary to first file an FIR at the nearest police station and then inform the insurer immediately. Information to the car insurance company is important since you would need to file a claim with the insurer to cover the repair costs incurred on fixing the damaged vehicle. To make a claim with your insurer for own damage to your car, below are the steps to be followed:

1. As stated earlier, report the incident to your insurer as early as possible. Your insurance company would need complete details of the incident, such as the registration number of the vehicle that caused the damage, the site of the accident, etc.
2. Make sure to submit all the desired details and relevant information pertaining to the accident to your insurer. Also, your insurer would require you to submit this information within a specified time duration, after which the claim would be considered invalid.
3. In case damage to the vehicle had been caused by a third party, it is imperative to inform the police about the incident as well. In this case, you would first need to file an FIR at the nearest police station to the accident site and then inform the insurer. During FIR filing, you would be required to state the registration number of the third-party vehicle involved in the accident as well as the license number of the vehicle driver.
4. File a claim for accident coverage with the insurer. The latter would then appoint a surveyor to conduct surveillance of the accident site and assess all relevant details pertaining to the accident in the claim. The claim can be filed either at the insurer’s office or online by downloading the form from the company’s website.

Documents Required for Filing the Claim

In the above section, we learned all about how to claim car insurance for own damage. Now, while filing the claim, your insurer would require you to submit some relevant documents pertaining to the accident for which the claim is being made. Here is a list of all the documents that you would need to submit:

• The claim form, either collected from the insurer or downloaded from the company’s website, duly filled and signed
• A copy of the car insurance policy purchased
• A copy of the certificate of car registration
• A copy of the FIR filed at the nearest police station
• A copy of the policyholder’s valid driving license for the car
• Original medical bills in case of any physical injury to the policyholder
• Original bills of any other expenses incurred pertaining to the accident
• Complete details of estimates for car repair

Read More: Do All Car Insurers in India Provide a Replacement for Damaged or Stolen Car?

What is Basic Own Damage Premium in Car Insurance?

Own Damage Premium in car insurance refers to the premium amount that you pay towards the policy in return for insurance protection against damages to your own car. When you buy a car insurance plan from an insurance company, the latter would require you to pay a certain amount regularly towards the insurance policy. In return, the insurer would guarantee to cover costs related to repair of the vehicle in case of any damage caused to your own car. This amount is known as Own Damage premium.

This premium is generally decided by the insurer on the basis of the type of car, the city/state where it is used, and the age of the vehicle. Moreover, some other factors like the make of the car, the engine’s Cubic Capacity (CC), the car’s Declared Value, and the geographical boundary of the vehicle are all taken into consideration while determining the Own Damage premium for a two-wheeler or car.

The simple formula used for calculating the Own Damage premium is as follows:

Standalone Own Damage Premium – No Claim Bonus + Applicable Discounts + Cost of Premium of Add-On Cover Benefits = Cost of Premium for Own Damage Car Insurance.

Wrapping Up

Car insurance for own damage is highly helpful to the policyholder since it allows them to claim coverage for damage to the own car, unlike the base insurance policy which only covers third-party liabilities. To buy own damage car insurance or for more details on the same, visit PayBima online. The website also offers the best deals on car insurance policies from various leading insurers.

Found this post informational? Browse PayBima Blogs to read interesting posts related to Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment section. You can visit PayBima to Buy Insurance Online.

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What is Term Insurance Renewal and Why Is It Important?

Table of Content

• What is Term Insurance?
• Reviving Term Plan or Buying New Term Policy
• Term Insurance Renewal Importance
• Advantages of Renewing Term Life Insurance Online
• Convertible vs Renewable term Insurance
• Process of Term Insurance Renewal

Renewing your term insurance policy to avail the benefits offered under a term plan is called term insurance renewal. In this post, we are discussing its meaning and importance to guide you better.

The sole purpose of a term insurance plan is to secure a family financially in the event of death of the term insurance policyholder. If a term insurance policy is not renewed on time, it might lapse. And in that case, the nominee of the policyholder will not receive any benefit in the event of death of the insured. Thus, the family might have to undergo financial hardships if the insured dies suddenly without renewing the term plan, thereby wasting the money already paid on premiums so far. Hence, non-renewal of policy brings an end to the effective use of a term plan.

Further, you may also note that term plan renewal doesn’t require the policyholder to go through medical examination. Thus, your medical history has nothing to do with term insurance renewal  as the insurer renews the plan without levying any additional charges.

 

 

What is Term Insurance?

Term insurance policy is nothing but a kind of life insurance plan which allows the policyholder to provide monetary coverage  to his/her family against the uncertainties of life. So, when a term insurance policyholder dies within the tenure of the policy, his/her family members receive the sum assured paid by the insurer. If the policyholder has a family with many dependents like kids, parents, spouse etc., buying a term plan serves as a good option to secure their future.

What is Better – Reviving a Lapsed Term Plan or Buying a New Term Policy?

Whether to revive a lapsed plan or buy a new policy ?  This is a question that many ask and many get confused with. When someone fails to renew a term plan, it gets lapsed. Normally, insurance companies allow a grace period of 15-30 days to renew policy even after the last date of policy renewal is gone. However, if you fail to renew the plan within the grace period, it lapses automatically.

However, whether to renew a lapsed plan or to buy a new plan is something that depends on the individual. But you must check all the aspects related to plan renewal or plan buying before taking a final decision. You should analyze every aspect of your requirement rather than just looking at the premium rate.

Here are few differences between reviving plan and buying new plan:

Renewed Term Policy	Buying New Term Policy
Policy will be available with benefits like No Waiting Period	Everything will start from scratch and no cumulative benefit will be offered
You don’t need to go through medical examination	You would have to go through compulsory medical examination
You will receive benefits of complete tenure of the plan	You will not receive full tenure benefits of term plan

Why is Term Insurance Renewal So Important?

Term insurance renewal is important because if the premium is not paid, the policy gets lapsed. This will deprive your family of the financial security that they may receive in case of your sudden demise. By renewing your term plan, you can continue to avail the coverage as per your age and requirements.

Below are some reasons why term insurance renewal is important:

• You get tax deduction –  A sum of up to INR 1,50, 000 can be exempted under section 80C of income tax.  Also, if you avail any term plan rider such as critical illness rider, you can get further exemption of INR 25,000 under section 80D of income tax act.
• You get to pay the same premium – By renewing your policy on time, you can continue to pay the same amount of premium, which might change in case your policy lapses.
• Health test and KYC – Undergoing health test and submitting KYC documents is not required in case you renew your policy on time.

What are the Disadvantages of not Renewing the term life Insurance?

1. Purpose of insurance is eliminated – If you do not renew your policy, the basic purpose of the term plan will not meet.  This is because the policy will lapse and the benefits cannot be availed by the beneficiary.
2. Term policy benefits get discontinued – Your family or nominee will not get the benefits in the form of sum assured if you do not pay the renewal amount of the term plan.
3. Can’t avail tax benefits – You will also not receive the exemption benefit of up to INR 1,50,000 as tax benefit if you do not renew the policy.
4. Nominees can’t file claims – The nominee of the policyholder can’t file a claim for your term plan if the policy is not renewed.

What are the Advantages of Renewing Term Life Insurance Online?

• It saves time and money
• You can renew from the comfort of your home
• You can use any of the online payment mode
• There are less chances of making a mistake while submitting the documents or details

 

Difference between Convertible and Renewable term Insurance

People often get confused regarding which type of term insurance is renewable? You may note here that there are two types of clause in term insurance plans – convertible term insurance and renewable term insurance.

Now you may wonder what is the renewable term insurance clause? Renewable term insurance clauses allow the policyholder to extend the existing coverage of the existing plan. So, here the coverage term can be extended for a specific time period without the policyholder getting to re-qualify for new coverage.

On the other hand, in case of a convertible term plan the policyholder can convert the policy coverage into whole life coverage anytime before turning 70 years.

Term Insurance Renewal Process

Here are the steps:

• Visit the official portal of your insurance provider
• Go to the renewal section of term plans
• Submit information like policy number and contact details
• Check the details of policy premium
• Finally, make the payment using online payment mode

Read More: What is Term Insurance with Maturity Benefits?

To Sum Up

Renewing your term plan every year on a timely basis is important to receive required benefits. Most insurance companies send reminders to policyholders to pay their renewal amount on time. It is the responsibility of the policyholder to keep a note of the date and renew the policy for the benefit of their family members. Renewal is an easy and simple process that can be done easily without any hassle. So, renew your plan to receive maximum benefit and to keep the financial security of your loved ones intact.

Found this post informational? Browse PayBima Blogs to read interesting posts related to Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment section. You can visit PayBima to Buy Insurance Online.

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