• Rural Postal Life Insurance Grama Suvidha Plan

    Life Insurance
    • Reduce taxable income by up to Rs. 1,50,000 deduction under section 80C**
    • Convenient payment options - annual, half-yearly, quarterly or monthly premium payments
    • Do more with plans that offer pure protection, retirement planning and investment options
    By Prarthana Gopal | 27 Sep 2023

    Grama Suvidha is a convertible whole life assurance policy offered under the Rural Postal Life Insurance scheme. The plan can be converted to an endowment assurance policy after completion of a certain time period. The benefits provided on death and maturity include bonuses too. This makes Rural Postal Life Insurance policies one of the cheapest life insurance policies with the highest returns in the market.

    Eligibility for Grama Suvidha Plan

    Policyholders need to consider the below-mentioned age restrictions.

    Minimum age at entry 19 years
    Maximum age at entry 55 years

    Sum Assured details of Grama Suvidha Plan

    The sum assured or the maximum amount payable on the death of the life assured has certain limits.

    Minimum sum assured Rs.10,000
    Maximum sum assured Rs.3 lakh

    *Sum assured limits are subject to change.

    Premium payable for the Grama Suvidha Plan

    The Grama Suvidha plan, like other Rural Life Insurance policies, can be availed for very low premiums. The premium is calculated based on factors such as the age at entry, sum assured chosen, policy term, etc. The premiums can be paid on a monthly basis at the post-office where the policy was purchased.

    Features of the Grama Suvidha Plan

    • Grama Suvidha can be purchased only by residents of the rural areas of the country.
    • The plan can be converted from a whole life assurance policy to an endowment assurance policy after completion of the first 5 policy years. After completion of the first 6 policy years, if the plan hasn’t been converted, the policy will remain a whole life assurance policy.
    • Medical examination before the purchase of the policy is mandatory.
    • Nominations can be made under the policy.
    • As of March 2014, the bonus offered under this scheme is high as 85%.
    Death Benefit In case of untimely death of the life assured, an amount equal to the sum assured plus accumulated bonuses is payable to the beneficiary of the policy.
    Maturity Benefit If the policyholder survives the complete policy tenure, he/she can claim the maturity benefit i.e. the sum assured plus accrued bonus.

    Other Key Features

    Nominal fee for late payment of premium If the premium is not paid for a certain month, it can be paid in the consecutive month with a late payment fine equal to Rs.1 for every Rs.100 sum assured.
    Policy revival If the policy has lapsed due to non-payment of premiums, it can be revived by paying the unpaid premiums along with interest. A policy can be revived twice at the most.
    Assignment for loan/credit Policies can be assigned as a collateral to receive loan or credit from a lending institution.

    Tax Benefits

    Policyholders qualify for tax benefits under section 80C of the Income Tax Act, 1961.

    Other Benefits

    Accessibility This scheme is run by the postal department and is hence easily available at a nearby post-office.
    Premium payment options Premiums can be paid by cash or by cheque. Policyholders can also opt for the auto-debit facility which automatically debits the premium amount from the salary.
    Duplicate policy document In case the policy document is torn, burnt, or mutilated, a duplicate copy can be provided.

    About Rural Postal Life Insurance

    The Rural Postal Life Insurance was started in the year 1995 when the Malhotra Committee pointed out that the insurance penetration, especially in rural regions, is low. The scheme offers low-cost life insurance policies that provide high returns. The reason the postal life insurance service is affordable is because existing post-offices are being utilised to provide life insurance services and no additional resources were hired for the same. The Rural Postal Life Insurance scheme has seen a steady growth over the years and currently has lakhs of customers who enjoy the benefits offered.

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