Standard Operating Procedure (SOP) for Handling of Surrender Claim Cases in PLI/RPLI

(As per www.indiapost.gov.in guidelines)

1. Objective

To provide a uniform and transparent procedure for the processing and settlement of Surrender Claim cases under Postal Life Insurance (PLI) and Rural Postal Life Insurance (RPLI).

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2. Definition

A Surrender Claim means the voluntary termination of a PLI/RPLI policy by the policyholder before maturity, in exchange for a Surrender Value, as per the terms and conditions of the policy.

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3. Eligibility Conditions

Policy Type	Minimum Period Before Surrender Allowed
Whole Life Policy (WLP)	After 3 years from the date of acceptance
Endowment Assurance (EA)	After 3 years from the date of acceptance
Convertible Whole Life Policy (CWLP)	After 3 years from the date of acceptance
Anticipated Endowment Policy (AEA)	After 3 years
Children Policy (CWA)	After 5 years (subject to age and conditions)

Note: No surrender value is payable if the policy is lapsed without acquiring paid-up value.

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4. Documents Required

1. Application for Surrender Claim by policyholder (Form 16-19 or prescribed surrender form).

2. Original Policy Bond.

3. Loan repayment statement (if any loan availed).

4. Identity proof and address proof of the policyholder.

5. Bank account details for NEFT payment.

6. Discharge voucher duly signed by the policyholder.

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5. Procedure for Processing

Step 1: Receipt and Verification

• Application received at Post Office or CPC (Customer Portal Centre).

• Verify identity and eligibility of the policyholder.

• Ensure that the policy has completed the minimum required period for surrender.

Step 2: Policy Details Verification

• Verify policy status from McCamish system / CSI PLI module.

• Confirm there are no outstanding loans or unpaid premiums.

• Check nominee and policy particulars match with the records.

Step 3: Calculation of Surrender Value

• System auto-calculates Surrender Value based on:

  • Type of policy

  • Premiums paid

  • Duration completed

  • Bonus accrued (if eligible)

(Surrender Value = Paid-up Value + Accrued Bonus, if any)

Step 4: Approval

• Verified and recommended by CPC in-charge / Divisional Head.

• Approval by Appropriate Authority as per financial limits.

Step 5: Payment

• Approved claim forwarded to Accounts Section / HO Accounts.

• Payment made through NEFT to the policyholder’s bank account.

• Entry updated in the McCamish system.

Step 6: Record Maintenance

• All documents scanned and uploaded in the system.

• Hard copies filed and preserved in the policy record section.

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6. Turnaround Time (TAT)

Activity	Responsible Office	Time Limit
Receipt & Preliminary Verification	Post Office / CPC	2 working days
Calculation & Approval	Divisional Office / CPC	3 working days
Payment Processing	Accounts Office	2 working days
Total TAT		7 working days

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7. Monitoring and Reporting

• CPC to maintain a Register of Surrender Claims.

• Monthly report to be sent to Circle Office / PLI Directorate.

• Random verification of settled cases by Sub Divisional Head.

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8. Important Notes

• Policies under litigation, assignment, or lien should not be surrendered.

• In case of lost policy bond, an indemnity bond must be furnished.

• No bonus is admissible for the incomplete policy year at the time of surrender.

• Proper acknowledgement must be given to the policyholder.

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9. References

• PLI Directorate Letter No. 25-1/2004-LI (Vol-II)

• Rule 38 & 39 of PLI/RPLI Manual

• www.indiapost.gov.in → PLI/RPLI Guidelines

MCQs on SOP for Handling of Surrender Claim Cases in PLI/RPLI (05.09.2023)

Comprehensive Set: 60 Questions (Set 1–4)

Set 1 – General Provisions and Eligibility

1. What is the minimum number of premiums required for a PLI/RPLI policy to be eligible for surrender?

A) 12 premiums
B) 24 premiums
C) 36 premiums ✅
D) 60 premiums

 

2. Which of the following policies cannot be surrendered?

A) Suraksha
B) Gram Santosh
C) Sumangal ✅
D) Yugal Suraksha

 

3. What is the formula for calculating Paid-Up Value?

A) (Total Premiums × Sum Assured) / Premiums Paid
B) (Sum Assured × No. of Premiums Paid) / Total Premiums Payable ✅
C) (Sum Assured / Total Premiums Payable) × 100
D) (Bonus × Premiums Paid) / Policy Term

 

4. The Surrender Value is equal to:

A) Paid-Up Value × 100
B) Surrender Factor × (Paid-Up Value + Proportionate Bonus) ✅
C) Sum Assured × Surrender Factor
D) Bonus + Paid-Up Value

 

5. A policy can be surrendered only if it has been in force for at least:

A) 12 months
B) 24 months
C) 36 months ✅
D) 60 months

 

6. When is no bonus payable on a surrendered policy?

A) Before 1 year
B) Before 3 years
C) Before 5 years ✅
D) After 10 years

 

7. What should the policyholder submit to initiate a surrender claim?

A) Letter of Indemnity only
B) Surrender Application/Claim Form (Annexure-I) ✅
C) Policy Renewal Form
D) Premium Receipt

 

8. Who can act as a messenger for surrender application submission?

A) Any family member
B) Any literate adult not insolvent ✅
C) Only postal employee
D) Minor child

 

9. For a policyholder abroad, which document must be submitted?

A) Copy of Air Ticket
B) Self-attested copy of Passport showing date of departure ✅
C) Visa Invitation Letter
D) Income Tax Return

 

10. Who is the approving authority for policies up to Rs. 20 lakhs sum assured?

A) Head of Division (Gr A)
B) Postmaster/Sr. Postmaster (HSG-I/HSG-II/Gr B) ✅
C) Director of Postal Services
D) Chief Postmaster General

 

11. Which of the following documents must be submitted in original with the surrender claim form?

A) Policy Bond or Letter of Indemnity ✅
B) Aadhaar Card
C) PAN Card
D) Cancelled Cheque

 

12. What happens if required documents are not received within 15 days?

A) Case is approved automatically
B) Reminder is sent (Annexure-VI) ✅
C) Policy is cancelled
D) Bonus is forfeited

 

13. What is the approving authority for policies between Rs. 20–50 lakhs sum assured?

A) Sub Postmaster
B) Head of Division (Gr A/Gr B) ✅
C) Divisional Inspector
D) CPC In-charge

 

14. What action is taken if surrender claim is rejected?

A) Case is closed silently
B) Rejection Letter is sent through Registered AD ✅
C) Claim is forwarded to Head Office
D) Policy is converted to paid-up

 

15. Who provides the acknowledgement slip to the policyholder after receiving the surrender claim form?

A) Agent
B) BPM/SPM/Postmaster/CPC In-charge ✅
C) Divisional Superintendent
D) Head of Circle

 

Set 2 – Annexures and Documents

16. Which annexure contains the Claim Form for Surrender of PLI/RPLI Policy?

A) Annexure-II
B) Annexure-I ✅
C) Annexure-III
D) Annexure-IV

 

17. What is the purpose of the Consent Form in the surrender claim?

A) To nominate a new beneficiary
B) To declare acceptance of the surrender value quoted ✅
C) To authorize bonus payment
D) To request a policy loan

 

18. When the original policy bond is lost, what must be submitted instead?

A) Duplicate ID proof
B) Letter of Indemnity ✅
C) Premium Receipt Book
D) Declaration Form

 

19. The Letter of Indemnity must be:

A) Signed by the Postmaster only
B) Notarized by a Public Notary on non-judicial stamp paper ✅
C) Signed by two witnesses only
D) Self-attested by the policyholder

 

20. Which annexure lists the documents acceptable as ID and address proof?

A) Annexure-I
B) Annexure-III ✅
C) Annexure-IV
D) Annexure-V

 

21. What is the minimum requirement for a messenger submitting a claim on behalf of an insurant?

A) Must be a government employee
B) Must be an adult, literate, and not insolvent ✅
C) Must be related to the policyholder
D) Must be a PLI agent

 

22. In case of a Pay Policy, what document must accompany the claim if all premiums are not updated?

A) Loan Receipt Book
B) Certificate from Employer (DOC) ✅
C) Cancelled Cheque
D) Letter of Indemnity

 

23. In case of a Cash Policy, which document is mandatory for updating premium payments?

A) Aadhaar Card
B) Premium Receipt Book ✅
C) Salary Certificate
D) Proof of Address

 

24. Which annexure is used for communication when required documents are missing?

A) Annexure-II
B) Annexure-IV ✅
C) Annexure-V
D) Annexure-VI

 

25. What is the time period given to the policyholder to submit missing documents after initial communication?

A) 7 days
B) 10 days
C) 15 days ✅
D) 30 days

 

26. Which annexure serves as the Checklist for Quality Checking at CPC?

A) Annexure-I
B) Annexure-V ✅
C) Annexure-IV
D) Annexure-VI

 

27. What does the CPC send if documents remain unsubmitted even after 15 days and one reminder?

A) Closure notice
B) Reminder Letter (Annexure-VI) ✅
C) Rejection order
D) Sanction letter

 

28. What action does the CPC take once the Approver approves a surrender case?

A) Generate a Sanction Letter ✅
B) File is closed
C) Bonus is paid immediately
D) Policy is reactivated

 

29. If the policyholder’s account details are incomplete, payment is made via:

A) Cash payment
B) Crossed Cheque ✅
C) Demand Draft
D) Pay Order

 

30. The Rejection Letter for a surrender claim is sent through:

A) Ordinary Post
B) Speed Post
C) Registered AD ✅
D) Email only

 

Set 3 – Workflow and Responsibilities

31. What should the Branch Postmaster (BPM) do after receiving a surrender claim form at a Branch Office (BO)?

A) Keep it for verification
B) Forward it to the Account Office on the same day ✅
C) Send it directly to the CPC
D) Wait for approval from HO

 

32. At the BO, the surrender claim form must be entered in:

A) Loan Register
B) Daily Account/Daily Transaction Report (DTR) ✅
C) Customer Complaint Log
D) Policy Register only

 

33. What should the Sub Post Office (SO) do after receiving the surrender claim form?

A) Send it directly to Directorate
B) Index and forward it to HO (CPC) the same day ✅
C) Retain it until end of month
D) Return it to BPM

 

34. Indexing of the surrender claim form at SO should be done if:

A) The claim originates from BO and hasn’t been indexed ✅
B) The policyholder requests it
C) The HO directs it
D) It is an endowment policy

 

35. At the CPC, all received documents must be recorded in:

A) Policy Register
B) Checklist (Annexure-V) ✅
C) Loan Register
D) Dispatch Log

 

36. If required documents are missing, CPC must send a written request using:

A) Annexure-II
B) Annexure-IV ✅
C) Annexure-VI
D) Annexure-III

 

37. The CPC must send the reminder for unsubmitted documents after how many days?

A) 7 days
B) 10 days
C) 15 days ✅
D) 20 days

 

38. Once the surrender application is complete, who ensures timely payment of the claim?

A) BPM
B) CPC In-charge ✅
C) Approver
D) Postal Assistant

 

39. For policies up to ₹20 lakhs sum assured, the approving authority is:

A) Head of Division (Gr A/Gr B)
B) Postmaster/Sr. Postmaster of HO (Gr B/HSG-I/HSG-II) ✅
C) Director of Postal Services
D) CPC In-charge

 

40. For policies above ₹20 lakhs and up to ₹50 lakhs, who approves the claim?

A) Postmaster of HO
B) Head of Division (Gr A/Gr B) ✅
C) Assistant Superintendent
D) Chief Postmaster General

 

41. The Approving Authority must record approval or rejection remarks on:

A) Claim Form
B) Checklist (Annexure-V) ✅
C) Service Register
D) Policy Ledger

 

42. After approval, the Sanction Letter is generated on:

A) Next working day
B) The same day of approval ✅
C) Within one week
D) After CPC verification

 

43. Who credits the sanctioned surrender amount to the policyholder’s account?

A) Agent
B) Postmaster/Sr. Postmaster of HO ✅
C) CPC In-charge
D) BPM

 

44. If a claim is rejected, who sends the Rejection Letter to the policyholder?

A) Approving Authority
B) CPC through Registered AD ✅
C) Head of Division
D) Agent of policy

 

45. After approval/rejection, the Approving Authority must return the checklist to CPC with:

A) Signature, name, designation, and date ✅
B) Only digital approval ID
C) Office seal only
D) Remarks without signature

 

Set 4 – Document Verification and Annexure Identification

46. Which document must be retained in original by the receiving office?

A) Aadhaar Card
B) Policy Bond or Letter of Indemnity ✅
C) ID Proof Copy
D) Cancelled Cheque

 

47. What must be done when a self-attested copy of any document is submitted?

A) Accept without verification
B) Compare with original and sign as verified ✅
C) Send it for approval
D) Scan and discard the original

 

48. The acknowledgement slip given to the policyholder is a part of which annexure?

A) Annexure-II
B) Annexure-I ✅
C) Annexure-V
D) Annexure-IV

 

49. The Letter of Indemnity (Annexure-II) must include:

A) Two witnesses and two sureties ✅
B) Only the policyholder’s signature
C) Postal employee’s attestation
D) Notary stamp only

 

50. The sureties and witnesses in a Letter of Indemnity must attach:

A) Photo copy of their premium receipt book
B) Self-attested copies of ID and address proof ✅
C) PAN card of insurant
D) Cheque leaf

 

51. Which annexure format is used by CPC to remind the policyholder when the claim form or additional documents are still pending?

A) Annexure-IV
B) Annexure-VI ✅
C) Annexure-V
D) Annexure-III

 

52. For verifying identity, which of the following is valid for both ID and address proof?

A) PAN Card only
B) Aadhaar Card ✅
C) Ration Card with address only
D) Water Bill

 

53. What is the purpose of the Checklist (Annexure-V)?

A) Policy premium verification
B) Document completeness check at CPC ✅
C) Agent payment tracking
D) Sanction letter generation

 

54. In which annexure does the CPC note the calculation of surrender value and net payable amount?

A) Annexure-II
B) Annexure-V ✅
C) Annexure-IV
D) Annexure-VI

 

55. The formula for determining Surrender Value includes:

A) Surrender Factor × (Paid-up Value + Proportionate Bonus) ✅
B) Sum Assured × Bonus Rate
C) Paid-up Value × Bonus × 100
D) Loan Outstanding × Surrender Factor

 

56. The Loan Receipt Book is required to verify:

A) Outstanding or repaid loan details ✅
B) Agent commission
C) Bonus eligibility
D) Policy maturity value

 

57. The Documents of Credit (DOC) are mandatory for:

A) Cash Policies
B) Pay Policies ✅
C) Lapsed Policies
D) Sumangal Policies

 

58. What must be enclosed if the policyholder requests payment via bank transfer?

A) Cancelled Cheque or POSB Passbook Copy ✅
B) Premium Receipt Book
C) Loan Statement
D) Policy Bond Copy

 

59. Who signs the acknowledgement slip for surrender claim receipt?

A) Agent
B) BPM/SPM/Postmaster/CPC In-charge ✅
C) Divisional Head
D) Policy Approver

 

60. Which helpline number is mentioned in the SOP for PLI customer service?

A) 1800-266-6868 ✅
B) 1800-123-4444
C) 155-299
D) 1800-225-111