Thursday, September 23, 2010

Hidden Treasure: Postal Life Insurance By Ushma Shah

September 06, 2010 Published in

Insurance products are never bought,  they are sold. So true! Most of the insurance companies spend loads of money on heavy duty advertising and go on talking about  their insurance policies in the media. They also have network of lakhs of insurance agents who in the lure of  commissions are selling the insurance policies all over India. Not only this, they also offer freebies along with policies thus taking customer into their trap. The realization comes only after buying the policies, and now it is really late, as we had already burnt our hands.

So, how do you escape this scenario?
Have you ever thought of having policies with better returns and cover than the regular ones sold by insurance companies and agents?
Postal Life insurance is your answer. Although it has never been talked about just because the postal department neither spends on advertising nor has a network of agents running around all over place to sell the policies, a postal life insurance comparatively has far better policies than the one’s sold in the markets by our large insurance players.

The only restriction on these insurance policies are that they can be offered only to employees of all Central and State Government Departments, Nationalized Banks, Public Sector Undertakings, Financial Institutions, Local Bodies like Municipalities and Zilla Parishads, Educational Institutions aided by the Government etc.  Such employees constitute comprise a large part of the population but they are still blissfully unaware of the benefits of postal life insurance.  

What is postal life insurance?
Postal life insurance run by the Department of Posts under the Government of India was started about 126 years ago in 1884. It was started as a welfare measure for employees of the Posts and Telegraphs department. As it started becoming popular, it was extended for the rest of bodies. In 1995, the Rural Postal Insurance was introduced exclusively for villagers who account for a majority of our population.  

Following are the few plans, which are offered by PLI:

Plan Name
Children Policy
Plan type
Whole Life Plan
Convertible Whole Life Scheme

Minimum Age at entry
19 years
19 years
19 years
5 years
Maximum Age at entry
55 years
55 years
55 years
20 years
Maximum sum assured
10 lacs
10 lacs
10 lacs
1 Lakh
Interest rate for loan
Bonus rates as on 2008-2009 per thousand

For the benefit of our readers, we have compared the insurance policies offered by the biggest insurer and Postal Life insurance and the results were quite surprising. We took Endowment plan offered by Postal Life Insurance i.e. Santosh and Endowment Assurance Plan offered by LIC. For the presented case, we took a 30-year-old male for a term of 20 years and a sum assured of Rs. 5 lakhs.

Plan name
Postal Life Insurance
Endowment Assurance Plan
Endowment Plan
Endowment Plan
Sum assured (in Rs.)
Policy Tenure
Premium per month (in Rs.)*

Bonus rate per thousand
Accumulated Bonus (in Rs.)
Maturity Value (in Rs.)
Return on investment
* Inclusive of Service tax

(#But actual amount is Rs1975)

The premiums for both the policies were nearly the same. But the main difference was created by the bonus amount offered by both the plans. Santosh plan by Postal department offers a bonus rate of Rs. 70 per thousand compared to Rs. 42 per thousand offered by LIC plan in the year 2008-09. Assuming the same bonus rate, the maturity value at the end of 20 years would be Rs. 12 lakhs for the Postal Life Insurance policy whereas for the LIC policy the maturity value of Rs. 9.2 lakhs. This includes the sum assured as well as the accrued bonus over the 20 years. The bonus rates of the past year have been assumed for the next 20 years.  So ultimately you end up getting almost Rs. 2.8 lakhs more just by choosing the right product as the benefits and features of the both the products are more or less the same.

So if you  are eligible,  buy postal life insurance for yourself and create an insurance portfolio with comparative higher return on investment. Postal life insurance is a good option if you are just looking out to buy pure life insurance cover, unlike LIC and rest of the insurers which offer accidental death benefit riders and many other riders with extra premiums.  They enjoy the same tax benefits the way a normal Life insurance policy receives. The premiums for these schemes can be paid at any of the post office across the country and loans are also available on the same.
This way we see that Postal Life Insurance carries immense value and everybody who is entitled should go for it.

The author, Ushma Shah, is senior research analyst with ,  a comparison site for financial products such as loans , investments and insurance plans

Input from Shri Joseph Rodrigues, Inspector Posts, Managalore

Tuesday, September 14, 2010

Some updates from IPASP Orissa Site

The GP upgrdation issue of IPs is marred by confusion and chaos at Directorate level. Question of surrendering Gazetted status of ASPs has arisen now while our CHQ insists on retaining the status. Orissa Circle Branch of AIAIASP has requested the GS to convene an urgent CWC meeting to take stock of the present situation and to decide the course of action to be followed if the Govt. continues with apathetic and insensitive attitude towards IP cadre.

The result of IP Exam 2009 is getting delayed with no indication of its publication in September 2010. GS says, answer sheets are now being checked again by evaluators as some omissions in the evaluation process came to notice.

ASP ad hoc promotion in Orissa is getting delayed as the process has been started to finalise the regular promotion first.

Cases of omissionss of MACP to IPs/ASPs have been taken up with APMG(Staff) who has assured to look into it soon.

Friday, September 10, 2010

Rejoinder in the OA No. 381/10 has been filed

Dear friends,

The case heard on 03.09.10 and two weeks time has been granted to the respondents for the reply to the rejoinder. The case is posted to 21.09.10. Further information will be given in due course. (Edited on 05.09.10)

Rejoinder in the OA 381/10 has been filed. All the issues raised by the Respondents in the reply statement have been suitably defended in the Rejoinder. Extract of Some main issues are given below:

Issue No.1 The Inspector Posts were not in the Pre-revised pay scale of Rs.6500-10500, hence they are not entitled for the benefit under OM dated 13.11.2009 issued by MOF.

It is clear from Paragraph 7.6.14 of 6th Central Pay Commission Report that Inspector Posts was upgraded in the pre-revised pay scale of Rs.6500-10500 on par with Inspectors and analogous posts in CBDT/CBEC as well as Assistants of Central Secretariat Service (CSS) with effect from 01-01-2006. Due to this upgradation only the pay scale of ASPOs was upgraded to the next higher pay scale of Rs.7450-11500. The contention of the respondents that Inspector Posts was upgraded in the pre-revised pay scale of Rs.6500-10500 only notionally with effect from 01-01-2006 and therefore, they cannot be treated alike with the comparable posts in CBDT/CBEC is untenable. It is pertinent to point out that the 6th Central Pay Commission found parity among Inspector Posts, Inspectors in CBDT/CBEC and Assistants in CSS and to effectuate this parity, the pay scale of Inspector Posts was upgraded with effect from 01-01-2006. Hence, any upgradation of pay scale or Grade Pay granted to Inspectors in CBDT/CBEC and Assistants in CSS is equally applicable to the Inspector Posts and the incumbents in the post of Inspector Posts alone cannot be discriminated in the matter of revision of Grade Pay. The averments to the contrary are emphatically denied.

Issue No.2 Inspector Posts are not comparable to the Inspectors in CBDT/CBEC and Assistants in CSS AND only Group B Post in Dept. of posts are comparable to the Group B posts in CSS/CBDT/CBEC. There is hierarchical problem due to intermediatory post of ASPOs in Dept. of Posts, unlike in CSS/CBDT/CBEC and if the Inspector Posts are given Grade Pay of Rs.4600, it will disturb the entire hierarchical structure of Inspector Posts and its promotional cadre both within the Departmental hierarchy and horizontal relativity outside the Department

The pay scales recommended by the 5th Central Pay Commission and 6th Central Pay Commission and accepted by the Government for the following categories are given below :

Pay scale recommended by the 5th CPC
and accepted by the Govt.
Pay scale recommended by the 6th CPC and accepted by the Govt.

1 Assistants in CSS and Inspectors in CBDT/CBEC Rs.5500-9000 9300-34800with GP Rs.4200
2 Inspector Posts Rs.5500-9000 9300-34800with GP Rs.4200
3 CentralExcise/Customs Superintendent,
Income Tax Officer Rs.6500-10500 9300-34800with GP Rs.4800
4 Section Officer in CSS Rs.6500-10500 9300-34800with GP Rs.4800
5 Assistant Supdt. Of Posts Rs.6500-10500 9300-34800with GP Rs.4600
6 Supdt. of Post Offices Rs.7500-12000 9300-34800with GP Rs.4800

It is evident from the above table that same pay scale/ Grade pay was granted by both 5th Central Pay Commission and 6th Central Pay Commission for Inspector Posts in comparison with Assistants in CSS and Inspectors in CBDT/CBEC. The Inspector (Posts) and other analogous posts in CBDT/CBEC and Assistsnts in CSS were enjoying the same scale of pay of Rs. 9300-34800 with Grade of Rs. 4200/- with effect from 01-01-2006 and were continued to draw the same scale of pay and grade pay as on the date of issuance of Annexure A-9 O.M. Dated 13-11-2009 and Annexure A-11 O.M dated 16-11-2009 granting the upgraded Grade Pay of Rs. 4600/- to the Inspectors of CBDT/CBEC and Assistants in the Central Secretariat respectively. Therefore, the persons like the applicants are subjected to hostile dicrimination in denying the grade pay of Rs. 4600/-

Department of Post made a proposal to the Ministry of Finance recommending to extend the benefit of Annexure A-9 O.M dated 13-11-2009 and A-11 O.M. Dated 16-11-2009 and to grant the Grade Pay of Rs. 4600/- to the Inspector (Posts) to maintain parity between similar cadres. In the above proposal the Department had categorically stated that the pay of Inspector (Post) was upgraded to Rs. 6500-10500 with effect from 01-01-2006 and the parity agreed to in the pay scales of Inspector (Post) with Assistants (CSS) and Inspectors CBDT/CBEC has not been recognised and given effect to while issuing Annexure A-9 and A-11. Therefore, it is evident that there is discrimination in the matter of grating Grade Pay to the Inspector (Post). However, the Ministry of Finance did not approve the proposal and returned the same. The reason for non-granting of Grade Pay of Rs. 4600/- to the Inspector (Post) alone by the Ministry of Finance is on three grounds. Firstly, prior to 01-01-2006 the Inspector (Post) was in the scale of Rs. 5500-9000 and secondly, the hierarchical structure in respect of Inspector (Post) is not comparable with the analogous posts in CBDT/CBEC. Thirdly, the 6th CPC specifically recommended the Grade Pay of Rs. 4200/- to the Inspector Posts. All the three reasons shown are entirely untenable. It is submitted that the pay scales of Inspector in CBDT/CBEC was upgraded from Rs.5500-9000 to Rs.6500-10500 as per Annexure A-5 dated 21-04-2004 and on the basis of Annexure A-5, the pay scale of Assistants in CSS was upgraded in September, 2006 as per Annexure A-6. As earlier stated the scale of pay of Inspector (Post) and other analogous posts were same i.e. Rs. 6500-10500 as on 01-01-2006 and the revised pay scales also were granted to them with effect from 01-01-2006 in the scale of pay of Rs. 9300-34800 with Grade Pay of Rs. 4200/- The 6th Central Pay Commission recommended only Rs. 4200/- as Grade Pay to the post of Inspector CBDT/CBCE and other analogous post. However, the Inspector in CBDT/CBCE and Assistants in Central Secretariat were granted the Grade Pay of Rs. 4600/- with effect from 01-01-2006 as per Annexure A-9 and A-11 respectively. Therefore, the Inspector (Post) is entitled for equal treatment as that of the Inspectors in CBDT/CBCE and Assistants in CSS.

It is submitted that hierarchical structure is not at all a criteria for granting Grade Pay. As stated earlier in different department different hierarchical structure is adopted and the comparable posts are enjoying similar benefits. The averments to the effect that only Group B Posts in Department of Post are comparable to those of Group B posts in CSS/CBDT/CBEC is totally unsustainable for the reason that the comparable posts of Inspector (Post) is Inspectors in CBDT/CBEC and Assistants in Central Secretariat Service. The details of pay scale and Grade Pay recommended by 5th and 6th Central Pay Commission and accepted by the Government shown in paragraph 4 (Table above) of the rejoinder statement would prove contrary to the contentions of the respondents. The contention of the respondent that the Assistant Superintendent of Posts is given the Grade Pay of Rs. 4600/- which is the next higher post of Inspector (Post) and therefore, the Inspector (Post) is not entitled for Grade Pay of Rs. 4600/- is unsustainable as some promotional posts in other Departments and feeder post are enjoying the same Grade Pay. For example, in Defence Accounts Department Sr. Accounts Officer is the feeder category for promotion to the post of Assistant Controller of Defence Accounts (ACDA) and both the posts are in the same Grade pay Rs.5400 in PB-3. Likewise, in the Postal Accounts Office (PAO) under the Department of Post, Senior Accounts Officer is the feeder post for promotion to the post of Assistant Chief Accounts Officer (ACAO) and both these posts are in the Grade pay Rs.5400 in PB-3. In Comptroller and Auditor General’s Officer, Senior Audit officer is the feeder post for promotion to the post of Assistant Accountant General(AAG) and the Grade pay is Rs 5400 in PB-3 for both these posts. Therefore, it will not lie in the mouth of the respondents to contend that the promotional post is in the Grade Pay of Rs. 4600/- and therefore, the Inspector (Post) is not entitled for the Grade Pay of Rs. 4600/-.

It is submitted that when parity is brought out by the Pay Commission and Inspector (Post) and Inspectors in CBDT/CBEC and Assistants in CSS is treated alike, the denial of equal grade pay would result in down grading the post of Inspector Post and the same is not permissible in law. It has been so held by the Hon’ble Supreme Court in Union of India and others Vs. Debashis Kar and others reported in 1995 Supp (3) SCC 528. Admittedly, the Department of Post recommended the same pay scale of Inspectors in CBDT/CBEC to the Inspector (Post) before the 6th Central Pay Commission and the same was approved by the Pay Commission granting the same scale of pay and Grade Pay and therefore, the department cannot turn around and contend that the Inspector (Post) are not entitled for the Grade Pay of Rs. 4600/-.

Issue No.3 Nature of duties assigned to Assistants in CSS are different to that of Inspector Posts.

Admittedly, the nature of duties assigned to Assistants in CSS are different from duties assigned to Inspector Posts since Assistants are office staff in Secretariat offices where as the Inspector Posts are the office staff in field. It is worthy to mention that 6th Central Pay Commission in Para 3.1.3 had recommended absolute parity in terms of hierarchical structure of office staff in field and Secretariat offices up to the level of Assistants and this recommendation was accepted by the Government. The above factual aspects were considered while issuing Annexure A-11 OM F.No.1/1/2008-IC dated 16.11.2009 as indicated in paragraph 4 of Annexure A-11. Parity made and recommended by the Expert Body namely, the Pay Commission and accepted by the Government cannot be denied by the Department under any pretext.

Issue No.4 Pay scale of Inspectors in CBDT/CBEC was upgraded to Rs.6500-10500 on 21-04-2004 and merely recruited through direct recruitment from the same All India Competitive examination does bring any parity between Inspector Posts and Inspectors in CBDT/CBEC & Assistants in CSS.

Admittedly the Inspectors in CBDT/CBEC were given the scale of pay of Rs. 6500-10500 on and from 21-04-2004 before the implementation of the 6th Central Pay Commission Recommendations and the above scale of pay of Rs. 6500-10500 granted to the Inspectors in CBDT/CBEC was considered and the Pay Commission found absolute parity with the Inspector (Posts) and other analogous posts and that's why the Pay Commission recommended to grant the pre-revised scale of pay of Rs. 6500-10500 to the Inspector Post upgrading their scale of pay from Rs. 5500-9000. Since the 6th Central Pay Commission recommendations were implemented only with effect from 01-01-2006 the scale of pay of Rs. 6500-10500 was granted to the Inspector Posts with effect from 01-01-2006 and not by an earlier date. Once the Pay Commission found parity with the analogous posts and recommended the same scale of pay the respondent cannot turn around and contend that the direct recruitment did not bring the Inspector Posts on par with the Inspectors in CBDT/CBCE. The Recruitment Rules were amended and element of direct recruitment was introduced only because of the recommendations of the 4th and 5th Central Pay Commission and based on the recommendation for bringing out parity by the Commission. The respondents are clearly overlooking the recommendation of the 4th pay commission in Paragraph 10.44, in which Inspector Posts were equated with inspectors in other Central Government organisations like customs and central excise and income tax and recommended to introduce direct recruitment to bring parity. The 5th pay commission also in paragraph 62.9 had granted the equal pay scale of Rs.5500-9000 with Inspectors in CBDT/CBEC with recommendation to introduce direct recruitment from the Inspectors Grade examination of Staff Selection Commission.

Issue No.5 Sub Inspectors in CBI are also recruited through the same examination and are in the Grade of Rs.4200 only.

Sub-Inspectors in CBI cannot be compared with Inspectors of Department of Posts, as they are Sub-Inspectors in the lower cadre and they belong to Group C post. The Pay Commission also did not recommend any parity with Sub Inspectors of CBI to that of Inspector (Post), Inspectors in the CBDT/CBCE and Assistants in the Central Secretariat Service. It is relevant to note that all the Inspectors (Central Excise, Income Tax, Customs etc.) and Assistants recruited through the Combined Graduate level Examination, conducted by Staff Selection Commission, are granted Grade Pay of Rs.4600, except the Inspector Posts. It is ironical to state that, though the Inspector Posts are Group B non gazetted they are being denied the equal grade pay to that of some Group C Inspectors in other Departments like Inspectors in the Income Tax Department. The Inspectors in the Income Tax Department is allowed the Grade pay of Rs. 4600/- even though they are Group C post.



Up- gradation of Grade Pay to the cadre of Insepector Posts

No.CHQ/IASP/SCPC Dated: 07-09-2010

Ms. Radhika Doraiswamy
Director General,
Department of Posts
Dak Bhawan, New Delhi-110001

Sub:Up- gradation of Grade Pay to the cadre of Inspector Posts-regarding
Ref: Postal Directorate No.4-12/2009-PCC dated 22-03-2010.

Respected Madam,

In continuation of this Association letter no. even dated 09-08-2010 and further discusssions with the DDG(Estt.) on 16-08-2010, it is submitted as under :-

Post of Inspector, Posts may be merged with the post of Asstt. Supdt. Posts with Grade Pay of Rs.4600/- with nomenclature as Asstt. Supdt. Posts as JAO(Non gazetted) was merged with AAO(Gazetted) with nomenclature as AAO. If ,it is not possible then post of Inspector, Posts may be retained as Inspector, Posts (Non-Gazetted Group-B) with Grade Pay of Rs.4600/- and post of Asstt. Supdt. Posts as Asstt. Supdt. Posts(Gazetted Group-B) with Grade Pay of Rs.4600/- as post of Senior AO and its promotional post of ACAO are in the same pay band of PB-3 with Grade Pay of Rs. 5400/-. Documentary proof in this regard is also attached.

Yours Faithfully,

General Secretary


Department of Post has introduced a new SERVICE DISCHARGE BENEFIT SCHEME (SDBS) for the Gramin Dak Sevaks vide Establishment Division Memo No 6/11/2009-PE-II dated 1.9.2010 .
Saliant features of the scheme are as under:-
1. This scheme is in lieu of existing Severance Amount Scheme on an optional basis. Mandatory for the new Gramin Dak Sevaks entering into the service with effect from 1.1.2011.
2. For existing GDS opted for the SDBS till the date of their joining, @ Rs 1500/- for every completed years of service will be added to the accumulated contributions at the time of discharge for annuitization.
3. Department shall contribute @ Rs 200 per month for each enrolled GDS. GDS shall not be required to make any contribution from their side. The contributions made by the Department shall be credited to the Trustee Bank designated by the Pension Fund Regulatory & Development Authority (PFRDA) and invested through Pension Fund Managers (PFMs) designated by the PFRDA.
4. If the GDS is placed under POD or unauthorizedly absent, no contribution shall be made by the Department.
5. If the GDS is absorbed in the Department in any regular Departmental posts, shall have to quit the SDBS and to seek transfer of the accrued accumulations to New Pension Scheme (NPS).
6. If a GDS wishes to exit after attaining the age of 58 years, he can withdraw 20% of the accumulations and has to invest 80% of accumulations for purchase of Life annuity from any of the Life Insurance Company authorised by IRDA. The Department shall not make further contributions once he exists from SDBS.
7. At the time of discharge, GDS would be required to invest a minimum 40% of accumulations to purchase Life Annuity from any of the authorised Life Insurance Company duly approved by IRDA. The remaining amount i.e 60% can be withdrawn.

For other details visit India Post Website.

Friday, September 3, 2010

News from IPASP Orissa Site

As a further development to the discussions held yesterday (on 01.09.2010) Chief PMG called the CS, AIAIASP, Orissa Circle Branch on 02.09.2010 and asked for feedback on the issue of upgradation of GP of IPs to Rs.4600/- for taking up the matter with Directorate. Required information has been supplied on 02.09.2010.
                    Source : IPASP Orissa Site

Good News for our GDS staff

      It is learnt from some reliable sources that, Pension scheme for GDS is approved. The Department will contribute Rs.200/- every month for annuity fund. This will be invested in debt fund up to 90%. After 65 years the GDS has the option to withdraw 60% and he will be getting monthly pension through annuity fund.
     No information about minimum and maximum subscription to be paid / recovered from Salary of GDS. The long pending demand of our GDS staff is finally met. We hope that the advent of NPS must have given a boost for approving the pension scheme for GDS staff.

    Anyway something is better than nothing.