| Group Insurance Scheme, 1980 |
Central Government Employees Group Insurance Scheme, 1980
Objective:
The 'scheme' is intended.to provide for the Central Government employees, at a low cost and on a wholly contributory and self-financing basis, the twin benefits of an insurance cover to help their families in the event of death in service and a lump-sum payment to augment their resources on retirement.
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Application:
The 'scheme' shall apply to all Central Government servants including those in the Railways, Posts & Telegraphs, and Defense except members of the armed and paramilitary forces who have already a separate scheme of their own. Contract employees, persons on deputation from State Governments, public sector undertakings, or other autonomous organizations, locally recruited staff in the Indian Missions abroad, casual, abjurer, part-time, and ad hoc employees will not be covered by the 'scheme'. The 'scheme' will also not apply to persons recruited under the Central Government after attaining the age of 50 years. Such Central Government servants to whom the 'scheme' applies will hereafter be referred to as 'employees'.
Membership:
1. The 'scheme' will be compulsory for all those 'employees' who enter Central Government service after the 'scheme' is notified, 1. e. all those 'employees' entering Central Government service after 1 November 1980 will be compulsorily covered under the 'scheme' from the date it comes into force.
2. Those 'employees' who are already in Central Government service on the date the 'scheme' is notified will have an option to opt out of the 'scheme'. This option should be exercised by 31 December 1980. Those 'employees' who do not opt out of the 'scheme' by that date will be deemed to have become members of the 'scheme', from the date the 'scheme' comes into force. The option once exercised (or 'not exercised') will be treated as final and no further choice will be available.
3. After the 'scheme' has come into force all 'employees' who enter service in a Month-other than January shall be enrolled as members of the 'scheme' on the next anniversary of the 'scheme'.
Subscription for members:
1. The subscription for the 'scheme' will be in units of Rs. 10/- per month. A Group D employee will subscribe for one unit, a Group C employee for 2 units, a Group B employee for 4 units and a Group A employee for 8 units. Thus, the rate of subscription for a member of the 'scheme' shall be Rs. 10/-, Rs. 20/-, Rs. 40/-, and Rs. 80/- per month for Group D, C, B and A employees respectively.
2. In the event of regular promotion of an employee from one Group to another, his subscription shall be raised, from the next anniversary of the 'scheme' to the level appropriate to the Group to which he is promoted. Until the date of the next anniversary of the 'scheme' he shall continue to be covered for insurance for the same amount for which he, was eligible before such promotion.
For example, if the 'scheme' comes into force w. e. f. 1 January 1982, a Group D employee promoted on regular basis to Group C in February 1982 shall continue to subscribe at the rate of Rs. 10/- per month upto December 1982 and be eligible for the insurance cover of Rs. 10, 000/- only in addition to the benefits from the Savings Fund appropriate to bis subscription. From January 1983, his subscription will be raised to Rs. 20/- per month and he will become eligible for an insurance cover of Rs. 20, 000/- in addition to appropriate benefits from the Savings Fund.
Premium and insurance cover for 'employees' other than members
The 'employees' entering service in a month other than January falling after January 1982 will be given benefit of appropriate insurance cover from the date of joining Government service to the date of their becoming members of the 'scheme' on payment of a subscription of Rs. 3/- per month as the premium for every Rs. 10, 000/-of the insurance cover. From the date of anniversary of the 'scheme' they will pay subscription at the rate indicated in para 5. 1 above.
For example, if the 'scheme' comes into force w. e. f. 1 January 1982, a Group D employee entering service in February 1982 shall pay a subscription of Rs. 3/-per month as premium for an insurance cover of Rs. 10, 000/- for a period of 11 months until December 1982 and from January 1983 his subscription will be raised to Rs. 10/-per month and he shall become eligible for the benefits from Savings Fund in addition to the insurance cover of Rs. 10, 000/-. Similarly, a Group C employee entering service in February 1982 will pay a subscription of Rs. 6/- per month as the premium for an insurance cover of Rs. 20, 000/- for a period of, 11 months up to December 1982 and from January 1983 his subscription will be raised to Rs. 20/- per month and he shall become eligible -for the benefits from the Savings Fund in addition to insurance cover of Rs. 20,000/-.
Insurance Fund and insurance cover for members
In order to provide an insurance cover to each member of the 'scheme' a portion of the subscription shall be credited to an Insurance Fund to be held in the Public Account of the Central Government. The amount of insurance cover will -be Rs. 10,000/- for each unit of subscription. It will be paid to the families of those 'employees' who unfortunately die, due to any cause, while in Central Government service.
Savings Fund
1. The balance of the subscription shall be credited to a Savings Fund. The amount in the Savings Fund will be held by the Central Government in Public Account. The total accumulation of savings, together with interest thereon will be payable to the member on his retirement after attaining the age of superannuation or on cessation of his employment with the Central Government or to his family on his death while in service.
2. The benefits from the Savings Fund will be as per illustration table attached herewith. This benefit is illustrative and in practice could be a little more or less than the amount shown in the table which has been constructed on the basis of individual's subscription reduced by the cost of insurance at mortality rate of 3. 75 per thousand and the compound interest of 10 per cent thereon. If at any time the rate of interest changes and/or the cost of insurance changes the benefits available from the Savings Fund will also change correspondingly.
3. In the case of death of a member the payment of the amount of Insurance will be in addition to the payment from the Savings Fund.
4. The positive balance under the Savings Fund shall be credited with the amount of interest calculated at the rate of interest notified by the Ministry of Finance, Department of Economic Affairs, for the purpose.
5. Interest will be allowed at 10 per cent per annum (compounded quarterly)
on the balances in the Savings Fund for a block of 5 years commencing
from the date the scheme comes into force.
Recovery of subscription
1. The subscription of a member for a month shall fall due at the commencement of the normal working hours on the first of that month.
2. The subscription as a premium for the insurance cover from the date of joining Government service to the date of membership of the 'scheme' shall initially fall due from the date of joining and subsequently from the commencement of normal working hours on the first of every month.
3. The subscription for a month shall be recovered by deduction from the salary/wage of the 'employee' for that month irrespective s of the date of actual payment of salary/wage for that month.
4. The subscriptions shall be recovered every month including the month in which/the 'employee' ceases to be in employment on account of retirement, death, resignation, removal from service etc.
5. The Drawing and Disbursing Officer shall recover the subscription from the 'employees' irrespective of their being on duty, leave or suspension.
6. No interest shall be levied on arrears of subscriptions if the non-recovery is due to delayed payments of salary/wage.
7. If an 'employee' is on extraordinary leave and there is no payment of his salary, wage for any period, his subscriptions for the months for which no payments of salary/wage are made to him shall be recovered with interest admissible under the 'scheme' on the accretions to the Savings Fund in not more than three instalments commencing from his salary/wage for the months following the month in which he resumes duties after leave. If an 'employee' dies while on extraordinary leave the subscriptions due from him shall be recovered with interest admissible under the 'scheme' on the accretions to the Savings Fund from the payments admissible to his family -under the 'scheme'.
For example, if a Group D employee proceeds on ten months' extraordinary leave from 5.2.1982 to 4,12.1982 and no salary/wage is paid to him for any day for March 1982 to November 1982, his subscriptions totaling Rs.80/- will he recovered together with the interest calculated at the compound rate of interest of 10% per annum in not more than three instalments commencing from January 1983,
8. If an 'employee' proceeds on deputation or on foreign service, the borrowing authority/foreign employer shall be requested to affect the recovery of the subscription and credit the same to the relevant head of account. It shall be ensured that the necessary clause to this effect is included in the terms of deputation/foreign service in future. The recovery of this amount will be watched in the same manner as applicable to leave salary and pension contribution. If at any time the recovery of subscription falls in arrears, the same shall be recovered with interest admissible under the 'scheme' on the accretions to the Savings Fund in not more than three instalments.
Financing of subscription from General/Contributory Provident Fund
1. It will not ordinarily be permissible to finance the 'scheme' from the General/ Contributory Provident Fund. However, if at any stage the position of an individual member does not permit him to subscribe to the 'scheme' and to the General/Contributory Provident Fund at the same time, he may be permitted to make, as a separate transaction, a non-refundable withdrawal from the General/Contributory Provident Fund of an amount equivalent to a year's subscription paid for the 'scheme'.
2. The subscription to the 'scheme' will form part of deductions allowable in respect of life insurance premia, contributions to provident fund etc., in computing the total income of the subscriber for the proposes of income-tax, except to the extent of the amount finally withdrawn from the General/Contributory Provident Fund on account of such subscription.
Payment from Insurance Fund/Savings Fund
1. If an 'employee' retires on attaining the age of superannuation or otherwise ceases to be in Central Government service and his service book discloses that he has been a member of the 'scheme', the Head of Office shall issue a sanction for the payment of the member's accumulation in his Savings Fund after obtaining a simple application in Form No.4.
2. If an 'employee' dies while in service/and his service book discloses that he was a member of the 'scheme', the Head of Office shall address the nominees/heirs of the Govern-ment servant concerned in Form No.5 to submit an application in Form No.6, and on receipt thereof shall issue a sanction for the payment of the amount of insurance and the accumulation in the Savings Fund to him (them).
3. The amount payable to the nominees/heirs of an 'employee' who has the benefit of an insurance cover only will be the amount of insurance appropriate to his Group.
4. The amount payable to the nominees/heirs of a member of the 'scheme', who dies while in service, shall be -
a. the amount of appropriate insurance to which he was entitled at the time of his death; plus,
b. the amount due to him out of the Savings Fund for the entire period of his membership in the lowest Group; and
c. the amount or amounts due to him for the additional units by which his subscription was raised on each occasion due to appointment/promotion to higher Group for the period from which the rate of subscription was raised to the date of his death.
For example, if a Group D employee, who is a member of the 'scheme,' acquires a membership in Group C and Group B after 5 years and 15 years of service respectively and dies while in service after 30 years of total membership in all these Groups, his nominee or nominees shall be paid the sum of the following amounts: -
i. the amount of insurance of Rs.40, 000/- due on a monthly subscription of Rs.40/-, being a Group B employee on the date of his death.
ii. the amount due from Savings Fund on a monthly subscription of Rs.10/-for 30 years.
iii. the amount due from Savings Fund on a monthly subscription of Rs.10/-(Rs.20 - Rs.10) for 25 years; and
iv. the amount due from Savings Fund on a monthly subscription of Rs.20/-(Rs.40 - Rs.20) for 15 years.
5. The amount payable to the 'employee' who ceases to be in employment with the Central Government on account of resignation., retirement etc., shall be -
i. the amount due to him out of the Sayings Fund for the entire period of his membership in the lowest Group; and
ii. the amount or amounts due to him for the additional units by which his subscription was raised on each occasion due to appointment/promotion to higher Group, for the period from which the rate of subscription was so raised to the date of cessation of his membership.
For example, if a Group D employee who is a member of the 'scheme' acquires a membership in Group C and Group B after 10 and 20 years of service respectively and retires on superannuation after 30 years of total membership in all these Group: I, he shall be paid the sum of the following amounts: -
i. the amount due to him from Savings Fund on a monthly subscription of Re. 10/- for 30 years.
ii. the amount due to him from Savings Fund on a monthly subscription of Re. 10/- (Rs.20 Rs.10) far 20 years; and
iii. the amount due to him from Savings Fund on a monthly subscription of Rs. 20/- (Rs.40 Its.20) for 10 years.
6. If any 'employee' dies during a month before the recovery of subscription for that month from him, his dues shall be paid after deducting the subscription.
7. If any 'employee' joins later on an All-India Service, his case shall be regulated in such manner as may be decided by the Ministry of Finance.
Withdrawals from Insurance Fund/Savings Fund
1. It will not be permissible for any member or other beneficiary of the 'scheme' to withdraw any amount out of the Insurance Fund to which he has been subscribing. The amount due from the Fund on the death of a member of the 'scheme' while in service, shall be worked out in accordance with para 11 and paid to his nominee(s) in accordance with the accounting procedure prescribed separately.
2. It will also not be permissible for any member of the 'scheme' to withdraw any amount of the savings Fund to which he has been subscribing. The amount due to him from the fund on his cessation of employment on account of resignation, retirement etc. shall be worked out' in accordance with para 11 and paid to him or his nominee(s).in accordance with the accounting procedure prescribed separately.
Loans/advances from or against accumulations in Insurance Fund/Savings Fund:
No loans or advances shall be paid to any member or other beneficiary of the 'scheme' from` or against his accumulations in the Insurance Fund/Savings Fund to which he has been subscribing.
Utilization of accumulations in Insurance Fund/Savings Fund:
The accumulations in the Insurance Fund/Savings Fund shall be at the disposal a of the Central Government. Since the 'scheme' is wholly self-financing and self-supporting, the bulk of these accumulations are proposed to be utilized for ownership housing schemes and other schemes for the benefit of the members of the 'scheme'.
Mode of notification of the 'scheme':
The 'scheme' shall be notified to the 'employees' by displaying a copy thereof on the notice board or where no such notice board is provided, at a prominent place in the premises where the employees are working. A few copies of the 'scheme' may also be supplied to the recognized unions/ associations of the employees. -
Action on notification of the 'scheme':
By the 10th of every month following the month in which the 'scheme' is notified, the Head of Office shall supply to the Drawing and Disbursing Officer names, Groups, dates of birth and dates of appointment of persons who may be appointed to any service or post under the Central Government during the preceding month and who would be eligible to be the members of the 'scheme' in terms of para 3 of the 'scheme'.
Action on the 'scheme', coming into force:
1. By the 10th of the month in which the 'scheme' comes into force, the Head of Office shall supply to the Drawing and Disbursing Officer a statement indicating the name, the Group and the date of birth of every 'employee' who has been in the Central Government service on the date the 'scheme' is notified but has not opted out of the 'scheme'.
2. Every member of the 'scheme' shall be informed in Form No. 1 the date of his enrolment, the subscription to be deducted and the benefits to which he would be eligible. On his regular promotion from one Group to another he will be similarly informed in Form No.2.
3. The option exercised by the 'employees' who are already in Central Government service on the date the 'scheme' is notified shall be in Form No. 3 and will be pasted in the service book of the individuals concerned.
Register of members:
The Head of Office shall ensure that Group-wise register of members is maintained in the Form No. 9 and kept up to date. This register shall be sent to the D. D. O. concerned once a year to verify whether appropriate subscriptions are being recovered from all employees who have joined the Insurance Fund or both the Insurance Fund and the Savings Fund under the 'scheme' and to record a certificate to this effect.
Nomination:
1. The Head of Office shall obtain from every Government servant, who is a member of the 'scheme', a nomination conferring on one or more persons, the right to receive the amount that may become payable under this 'scheme' in the event of his death before attaining the age of superannuation. In the case of 'employees' who are already in Central Government service on the date the 'scheme' is notified and who do not opt out of the 'scheme', such nomination shall be obtained simultaneously with the options obtained from others and in the case of 'employees' who join Central Government service after the date on which the 'scheme' is notified, such nomination shall be obtained along with the joining report.
2. If a member of the 'scheme' happens to be minor, he will be required to make nomination on his attaining the age of majority.
3. If a member of the 'scheme' has a family at the time of his making the nomination he shall make such nomination only in favour of member or members of his family. For this purpose, family will have the same meaning as assigned to it in the General Provident Fund (Central Services) Rules, 1960.
4. If a member nominates more than one person under para 19.1 he should specify in the nomination the amount of share payable to each of the nominees in such a marine r as to cover the whole of the amount payable under the 'scheme', failing which the amount payable under the 'scheme' shall be equally distributed among the nominees.
5. The nomination shall be made in Form No.7 or Form No.8, as is appropriate in the circumstances.
6. A member of the 'scheme' may at any time cancel a nomination by sending a notice to the Head of Office along with a fresh nomination made in accordance with the above provision.
7. The nomination received from the members shall be counter-signed by the Head of Office and pasted on their service books. The Head of Office shall also make an entry in the service book that the nomination has been duly received.
The existing Insurance Scheme:
The existing insurance scheme introduced vide Department of Expenditure O.M. Ne. 60/14/77-IC dated 23rd June 1977 will continue for those 'employees' who would be in service on 1.11.1980, if they opt out of the new' scheme ', till they case to be in employment with the Central Government on account of retirement, resignation, death, etc. As regards the other 'employees' the new 'scheme' will replace the existing insurance scheme w. e. f. 1.1.1982 and the amount which would have been due to them under the existing insurance scheme had they ceased to be in employment with the Central Government in the afternoon of the day preceding the day on which they become members of the new 'scheme' will be credited to their respective General Provident Fund accounts.
Accounting:
The transactions relating to the 'scheme' shall be accounted for in accordance with the procedure laid down separately.
Interpretation and clarification:
1. If any categories of 'employees' are not specifically classified into Group A, Group B, Group C or Group D, their classification shall be assumed in accordance with the principles laid down in this regard under the Central Civil Service (Classification, Control and Appeal) Rules, 1965.
2. In the actual implementation of the 'scheme', if any doubt arises in regard to the interpretation of any of the provisions of this 'scheme' or if any point requires clarification, the matter may be referred to the Ministry of Finance, whose decision shall be final.
Review of the 'scheme':
The working of the 'scheme' will be reviewed every three years to ensure that the 'scheme' remains self-financing and self-supporting.
