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After a long wait, Government has proposed to the subscription amount and the Insurance Cover under Central Government Employees Group Insurance Scheme (CGEGIS).
Last revision in the Insurance cover and subscription amount was made way back in the year 1990. However, this Scheme was not at all reviewed by Government thereafter while two pay commissions (5th and 6th) have been implemented in the mean time.
Now, Government given some positive signals for the revival of the scheme.
In reply to the representation made by Office bearers of National Federation of Indian Railwaymen (NFIR), Department of Expenditure, Ministry of Finance has replied that increase in the rate of monthly subscription and amount of insurance cover under the Central Government Employees Group Insurance Scheme is under the consideration of the Ministry of Finance.
These are the details of CGEGIS presently provided by Government.
It came into force from 1st January,1982, and provides employees either the life insurance cover in the case of death during service or a maturity amount in the case of retirement from service.
A portion of the subscription is credited to Insurance Fund and the other portion to the Savings Fund in the ratio of 3:7. The Savings Fund will earn interest at the prescribed rate to be compounded quarterly.
Monthly subscription, life insurance sum assured and Maturity amount applicable for different cadres are as follows
|Employee Cadre||Contribution per Month (Rs.)||Insurance cover (Rs.)|
Features of this Scheme:
- On Resignation/Retirement :- Amount of subscription credited to the Savings Fund along with interest thereon will be paid to the employee.
- On Death : Amount of insurance cover of the group to which he belongs on the date of death and the accumulation in Savings Fund will be paid to his nominee/heirs.
- If an employee dies before he was enrolled as a member (i.e. between the date of his joining service and the following Ist January), only the insurance amount will be paid to the nominee/heirs.
- Employee can assign the insurance cover and accumulation in the savings fund to a recognized financial institution, for obtaining housing loans. However, no loans/advance or withdrawals are permitted from Insurance Fund/Savings Fund.
- The amount of subscription is eligible for Income Tax Rebate u/s 88 of IT Act.
The following previous article would reveal and the real importance of this Scheme and the present apathy.