Rural Postal Life Insurance Tax Benefit - Save on Taxes with Affordable Coverage

Common Features of RPLI

The common features of plans under RPLI is as follows:

1. Any resident in rural areas can apply for the RPLI policies.
2. The minimum sum assured is Rs.10,000.
3. The maximum sum assured is Rs.10 lakh.
4. The maximum age for entry is 55 years for endowment and whole life plan but 45 years for others.
5. All plans will need a compulsory medical examination.
6. If you choose a non-medical policy, then the maximum sum assured is Rs.25,000 and the maximum age is 35 years for entry.
7. If the applicant has no proof of age, then the maximum age limit allowed is 45 years.

Benefits of Rural Postal Life Insurance

The benefits of RPLI are as follows:

1. There is a 100% security offered by the Government of India.
2. The premium payment is low but the bonus offered is high.
3. The insured can take loan against the policy. Policy, if Endowment, then it should complete 3 years and 4 years in the case of Whole Life Assurance.
4. Insured can surrender can opt for conversion, assignment and paid-up value.
5. The insurance policy can be easily transferred to any place in India for no charge.
6. The interest on loan is payable every 6 months.
7. Passbook facility is available.
8. Pay recovery facility is available for institutions that have more than 20 policies.
9. 1% rebate is offered for payment of 6 months premiums in advance.
10. 2% rebate is offered for payment of 12 months premiums in advance.
11. Nomination facility is also available.
12. If the policy lapses for non-payment of premium, then it can be revived by paying the premiums due. Policy will lapse if 6 premiums are unpaid for a policy that has been in force for less than 3 years and 12 premiums if the policy has remained in force for over 3 years.
13. The policy payment can be made through any post office across India.
14. The claims are settled easily as the process is fully computerised.
15. If the premium amount is more than Rs.20, then the premium payment can be made by cheque.
16. You can change the nominee, if required.
17. If the policy bond is lost, then a duplicate bond is issued.
18. A Whole Life Assurance can be converted to Endowment Assurance and Endowment Assurance can be converted to other Endowment Assurance schemes as per the rules.

Tax Benefits of RPLI

The following are the tax benefits one can avail if he or she has taken a RPLI policy:

1. Deduction under Section 80C for the premiums paid as per the Income Tax Act, 1961.
2. The insured can also avail rebate under Section 88 of the IT Act. 

GST of 18% is applicable on life insurance effective from the 1st of July, 2017