Postal Life Insurance (PLI) is very popular in the rural as well as urban areas of India, reason being the wide network of post offices all over the country. When it comes to insuring the future of your child, opting for a government scheme makes perfect sense if you’re quite risk-averse and security is your prime concern. That is when the pioneer child policy of Postal Life Insurance comes into the picture – Post Office Child Plan aka Bal Jeevan Bima.
What is Post Office Child Plan?
Going by the name of Bal Jeevan Bima, post office child plan is made to help the Indian parents from all socio-economic backgrounds in insurance of future of their children. Since this is powered and monitored by India Post, there is least risk involved and whatever the money is pooled in this policy gets safely returned. Although, due to such high risk-averse factor, returns are quite low, i.e. for every Rs.1000, there is a bonus of Rs.58.
Types of Post Office Child Plans
There is only one type of child plan offered by Postal Life Insurance, i.e. Children Policy also going by the name of Bal Jeevan Bima.
What All Post Office Child Plan Covers?
Being a highly basic insurance instrument, post office child plan covers only death of the proposer, i.e. the parent. In case of untimely demise of the parent, the child shall receive the sum assured along with all the bonuses accrued at the completion of the policy. Although at the event of death of the parent, payment of all future premiums is waived off.
How Post Office Child Plan Functions?
It’s the easiest and most convenient way of building a decent corpus for your child without having to worry about risks involved in the finance market.
The parent purchases the policy in their name whereas the child becomes the beneficiary. This is because the onus of paying premiums falls directly on parent(s) while the child simply reaps the benefits of the same.
This premium is to be paid till the end of the policy term. As soon as the term expires, so does the policy and it cannot be further renewed.
|Entry Age||Child: 5 – 20 years
Proposer: 18 – 45 years
|Minimum Sum Assured||Rs.3 lakh|
|Number of members||2 children|
Employees of the following organizations are eligible for post office child plan:
- Central Government
- Defence Services
- Para Military forces
- State Government
- Local Bodies
- Government-aided Educational Institutions
- Reserve Bank of India
- Public Sector Undertakings
- Financial Institutions
- Nationalized Banks
- Autonomous Bodies
- Extra Departmental Agents in Department of Posts
- Employees Engaged/ Appointed on Contract basis by central/ State Government where the contract is extendable
- Employees of all scheduled Commercial Banks
Note:Employees of private sector are excluded from this list.
Following points are noteworthy in order to make a better understanding of Post Office Child Plan, i.e. Bal Jeeva Bima or Children’s Policy:
- The bonus is the same as that of the endowment policy
- Maturity benefits include both the sum assured and bonuses accrued
- In case of death of the child, the policy ceases to exist and bonus + sum assured becomes immediately payable
- There is no loan facility in this plan, i.e. one cannot take loan against Bal Jeevan Bima
Advantages of Buying Post Office Child Plan
- Sure-shot returns guaranteed
- In case of unfortunate demise of the parent, the policy still goes on but future premiums are waived off
- No risk involved
- Reap benefits at the lowest premium
- Duplicate bond certificate can be issued in case the original policy document is lost
Q1. Do I get any tax benefits in this plan?
Yes, all the premiums paid towards this plan are exempted from tax as per the Section 80C of Income Tax Act, 1961.
Q2. I work in a private company. Can I enrol in this plan?
No. As per the policy rules, employees of private sector are not eligible for Postal Child Plan.
Q3. What is the bonus that I can avail in Bal Jeevan Bima?
Bal Jeevan Bima, i.e. Postal Child Plan gives the same bonus that ir forwards for its endowment policy. For every Rs.1000of Sum Assured, there is a fixed bonus equalling to Rs.58.