Central Government Employees Group Insurance Scheme, 1980-Updating of the Scheme

Central Government Employees Group Insurance Scheme, 1980 – Updating of the Scheme

No.F.7(5)-EV/89
Government of India
Ministry of Finance
Department of Expenditure

New Delhi, the 15th May, 1989

OFFICE MEMORANDUM

SUBJECT:- Central Government Employees Group Insurance Scheme, 1980-Updating of the Scheme.

The undersigned is directed to invite the attention of all Ministries/Departments of the Central Government to this Ministry’s O.M.No.F.15(3)78-WIP dated 31st October, 1980 circulating Central Government Employees Group Insurance Scheme, 1980 which was introduced w.e.f. 1st January, 1982.

In view of the numerous clarifications/instructions issued after the introduction of the scheme and enhancement in the rates of subscription and insurance covers for all the four Groups of employees w.e.f. 1st January, 1990 it has become necessary to update the scheme.

Accordingly the scheme has been updated by incorporating all the clarifications/instructions issued so far. A copy of the same is enclosed for information.

2. A few important salient features of the scheme are as under:-

(i) An employee who joins Government service on or after 2nd January of any year shall be enrolled as a member of the scheme on the next anniversary of the scheme. Insurance Cover on payment of premium at the rate of Rs.4.50 for every Rs.15,000/- of insurance cover will be provided from the date of appointment to 31st December as stated in para 6 of the Scheme.

(ii) A member of the Central Government Employees Group Insurance Scheme, 1980 cannot simultaneously be a member of any other Group Insurance Scheme.

(iii) Insurance Cover will be paid to the families/heirs of those employes who die due to any cause, including suicide, while in service.

(iv) An employee who joins service on or after 1st February, 1989 will become member of the scheme with the revised rates of subscription and insurance cover.

(v) Those ‘employees’ who were members of the Scheme on 31st January, 1989 and have exercised their option against the revised rate of subscription and insurance cover, will continue to subscribe in units of Rs.10/-p.m. till they cease to be in Government service on account of retirement, resignation, death etc.

(vi) In the case of a missing employee insurance cover will be paid after the expiry of a period of seven years and subject to the condition prescribed in para 11.4 of the scheme even if the date of superannuation of the missing employee falls before the expiry of seven years.

(vii)Assignment of Insurance cover and accumulation in the Savings fund to a recognised financial institution for the purpose of obtaining loan is permissible even if the loan is required for purchase of a plot of land or a ready-built house or for construction of a house which is in the name of a member of the family of the Government employee and not in his/her own name.

(viii) If a member of the scheme dies without leaving any valid nomination the insurance amounts will be paid to the members of family as defined in para 19.3 of the scheme without production of any Succession Certificate. Other legal heirs will, however, be required to produce Succession Certificate.

(ix) Dues recoverable by Government from member of the scheme shall not be adjusted from the amounts payable under the scheme except the loan taken from a recognised financial institution on assignment of insurance cover and Savings Fund amount.

3. Hindi version of this Office Memorandum and the updated scheme is enclosed

(Anjali Devasher)
Deputy Secretary to the Govt. of India

CENTRAL GOVT. EMPLOYEES GROUP INSURANCE SCHEME, 1980

Date of effect

1. Central Govt. Employees Group Insurance Scheme, 1980 here-in-after referred to as the ‘scheme’ was notified on 1st Nov., 1980 and came into force with effect from the forenoon of 1st Jan., 1982.
Objective

2. The ‘scheme’ is intended to provide for the Central Govt. 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.
Application

3.1 The ‘scheme’ shall apply to all Central Govt. servants including those in the Railways, Posts and Telegraphs and Defence except members of the Armed and Para-Military Forces who have already separate schemes of their own. Contract employees, persons on deputation from State Govts., Public Sector Undertakings, or other autonomous organisations, locally recruited staff in the Indian Missions abroad, casual labourer, 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 Govt. after attaining the age of 50 years. Such Central Govt. servants to whom the ‘scheme’ applies will hereafter be referred to as ‘employees’.

3.2 Re-employed defence personnel availing the extended insurance cover under the Group Insurance Scheme applicable to the members of Armed Forces shall not be eligible to become members of the Central Govt. Employees Group Insurance Scheme, 1980 as long as they continue to avail such insurance cover.

On expiry of that benefit and subject to fulfilment of the prescribed conditions, these personnel may, on their request, be considered for memebership under the Central Govt. Employees Group Insurance Scheme, 1980.

Membership

4.1 The ‘scheme’ will be compulsory for all those ‘employees’ who enter Central Govt. service after the ‘scheme’ is notified i.e., all those ‘employees’ entering Central Govt. service after 1st Nov., 1980 will be compulsorily covered under the ‘scheme’

4.2 Those ‘employees’ who were in Central Govt. service on the date the ‘scheme’ was notified had an option to opt out of the ‘scheme’ by 31st January, 1981. Those ‘employees’ who did not opt out of the ‘scheme’ by that date were deemed to have become members of the ‘scheme’ from the date the ‘scheme’ came into force. Those ‘employes’ who had opted out of the ‘scheme’ were, however, allowed further opportunities on 20th February, 1982, 14th February, 1983, 30th March, 1985 and 27th October, 1986 to become members of the ‘scheme’.

The option on all these occasions was to be exercised in Form No. 10. No further choice will be available to the employees who failed to avail themselves of the opportunity given on 27th October, 1986.

4.3 After the ‘Scheme’ has come into force all ‘employes’ who enter service on or after 2nd January of any year shall be enrolled as members of the ‘scheme’ on the next anniversary of the ‘scheme’.
Subscription for members

5.1 The subscription for the ‘scheme’ will be in units of Rs.10/-p.m. till 31st Dec, 1989. Thereafter, with effect from 1st Jan., 1990 the subscription for the ‘scheme’ will be in units of Rs.15/-p.m. All those’ ‘employes’ who were members of the ‘scheme’ on 31st Jan., 1989 have an option to opt out of the scheme with subscription units of Rs.15/-p.m.

This option should be exercised by 15th June, 1989. Those ‘employees’ who do not opt out of the ‘scheme’ with the subscription units of Rs. 15/-p.m. by that date will be deemed to have opted for the ‘scheme’ with the subscription units of Rs.15/- p.m. effective from 1st Jan., 1990.

The option, once exercised (or ‘not exercised’) will be treated as final and no further choice will be available. Other employees who opt out of the ‘scheme’ with the subscription units of Rs.15/- p.m. will continue to subscribe for the ‘scheme’ in units of Rs.10/- p.m. till they cease to be in employment with the Central Govt. on account of retirement, resignation, death etc.

5.2 A Group ‘D’ employee will subscribe for one unit, a Group ‘C’ employee for two units, a Group ‘B’ employee for four units and a Group ‘A’ employee for eight units.

Thus, the rate of subscription for a member of the ‘scheme’ who opts out of the scheme with the subscription units of Rs. 15/- p.m. shall be Rs. 10/-, Rs. 20/-, Rs. 40/- and Rs. 80/- p.m. for Group, ‘D’, ‘C’, ‘B’ & ‘A’ employees respectively. In the case of other employees the rate of subscription for the ‘scheme’ shall be Rs.15/-, Rs.30/- Rs.60/- and Rs. 120/- p.m. for Group ‘D’, ‘C’, ‘B’ & ‘A’ employees respectively.

5.3 In the event of regular promotion of an employee from one Group to another, his/her subscription shall be raised from the next anniversary of the ‘scheme’, to the level appropriate to the Group to which he/she is promoted. Until, the date of next anniversary of the ‘scheme’ he/she shall continue to be covered for insurance for the same amount for which he/she was eligible before such promotion.

For example, if the revised rates of subscription come into force w.e.f., 1st Jan., 1990, a Group ‘D’ employee promoted on regular basis to Group ‘C’ in Feb., 1990 shall continue to subscribe at the rate of Rs.15/- p.m. upto Dec., 1990 and be eligible for the insurance cover of Rs. 15,000/- only in addition to the benefits from the Savings Fund appropriate to his subscription.

From Jan., 1991 his subscription will be raised to Rs.30/- p.m. and he will become eligible for an insurance cover of Rs.30,000/- in addition to appropriate benefits from the Savings Fund.

5.4 Sometimes ‘regular’ promotion, e.g., on ‘until further orders’ basis cannot be made for various reasons even though it is known that the promotion of the individual is likey to continue on a long term basis.

Therefore, unless a promotion has been made for a specified or short period and expected that the employee would revert to a post in a lower group at the end of that period, he/she should be treated to have been promoted, for the prupose of the ‘scheme’ on a regular basis and subscription should be-recovered accordingly.

The question, whether an employee is likey to revert to a post in the lower Group may be decided by the administrative authorities in their discretion, taking into considertation the circumstances of each case. Once a person has been admitted to a higher Group, the rate of subscription will continue at the same level even if that person reverts to a post in the lower Group later on for any reason.

Premium and insurance cover for ‘employees’ other than members.

6. The ‘employees’ entering service on or after 2nd Jan., of any year will be given benefit of appropriate insurance cover from the date of joining Govt. service to the date of their becoming members of the scheme on payment of a subscription of Rs. 4.50 p.m. as the premium for every Rs. 15,000/- of the insurance cover. From the date of anniversary of the ‘scheme’ they will subscribe at the rate indicated in para 5.2 above.

For example, if the revised rates of subscription come into force w.e.f., 1st Jan., 1990, a Group ‘D’ employee entering service in Feb., 1990 shall pay a subscription of Rs. 4.50 p.m. as premium for an insurance cover of Rs. 15,000/- for a period of 11 months until Dec., 1990 and from Jan., 1991 his subscription will be raised Rs. 15/- p.m. and he shall become eligible for the benefits from Savings Fund in addition to the insurance cover of Rs.15,000/-.

Similarly a Group ‘C’ employee entering service in Feb., 1990 will pay a subscription of Rs. 9/- p.m. as the premium for an insurance cover of Rs. 30,000/- for a period of 11 months upto Dec., 1990 and from Jan., 1991 his subscription will be raised to Rs.30/- p.m. and he shall become eligible for the benefits from the Savings Fund in addition to insurance cover of Rs. 30,000/-

Insurance Fund and Insurance Cover for members

7.1 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 Govt.

The amount of insurance cover will be Rs. 15,000/- for each unit of subscription of Rs.15/- p.m. and Rs. 10000/- for each unit of subscription of Rs. 10/- p.m. and Rs. 10000/- for each unit of subscription of Rs.10/- p.m. It will be paid to the families of those ‘employees’ who unfortunately die due to any cause, including suicide, while in Central Govt. service.

7.2 The positive and negative balances under the insurance Fund shall be credited or debited, as the case may be, with the amount of interest calculated at the prevailing rate of interest on the Post Office Savings bank Deposits, which at present is 5 ½% per annum.
Savings Fund

8.1 The balance of the subscription shall be credited to a Savings Fund. The amount in the Savings Fund will be held by the Central Govt. 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 Govt. or to his family on his death while in service.

8.2 The actual benefits from the Savings Fund will be as shown in the Table to be issued for each year. The Table will be constructed on the basis of individual’s subscription reduced by the cost of insurance at mortality rate of 3.60 per thousand per annum and the compound interest at the rate of 12% per annum (compounded quarterly). 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.

8.3 In the case of death of a member while in service the payment of the amount of insurance will be in addition to the payment from the Savings Fund.

8.4 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, Deptt. of Economic Affairs, for the purpose.

8.5 Interest was allowed at 10% per annum (compounded quarterly) on the balances in the Savings Fund for the period from 1st Jan., 1982 to 31st Dec., 1982 and at 11% per annum (compounded quarterly) on the balances in the Savings Fund for the period from 1st Jan., 1983 to 31st Dec., 1986. Interest is allowed at 12% per annum (compounded quarterly) on the balances in the Savings Fund w.e.f., 1st Jan., 1987.

Recovery of subscription

9.1 The subscription of a member for a month shall fall due at the commencement of the normal working hours on the 1st of that month.

9.2 The subscription as a premium for the insurance cover from the date of joining Govt. 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 1st of every month.

9.3 The subscription for a month shall be recovered by reduction from the salary/wage of the ‘employee’ for that month irrespective of the date of actual payment of salary/wage for that month.

9.4 The subscription shall be recovered every month including the month in which the ‘employee’ ceases to be in employment on account of retirement, death, resignation, removal, etc., from service.

9.5 The Drawing and Disbursing Officer shall recover the subscription from the ‘employees’ irrespective of their being on duty, leave or suspension.

9.6 No interest shall be levied on arrears of subscription if the non-recovery is due to delayed payments of salary/wage.

9.7 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 rounded to the nearest whole rupee 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 duty after leave.

If an ‘employee’ dies while on extraordinary leave the subscriptions due from him shall be recovered with interest rounded to the nearest whole rupee 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 5.2.1990 to 4.12.1990 and no salary/wage is paid to him for any day for March, 1990 to Nov., 1990, his subscriptions totalling Rs. 135/- will be recovered together with the interest calculated at the compound rate of interest of 12% per annum in not more than three instalments commencing from Jan., 1991.

9.8 If an employee proceeds on deputation or on foreign service the borrowing authority/foreign employer shall be requested to effect 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 terms of deputation/foeign service.

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.

Finance of subscription from General/Contributory Provident Fund

10.1 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’.

10.2 The subscription to the ‘scheme’ will form part of the deduction allowable in respect of life insurance premia, contributions to Provident Fund etc., in computing the total income of the subscriber for the purpose of income-tax, except to the extent of the amount finally withdrawn from the General/Contributory Provident Fund on account of such subscription.
Payments from Insurance Fund/Savings Fund

11.1 If an ‘employee’ retires on attaining the age of super-annuation or otherwise ceases to be in Central Govt. Service and his service book discloses that he has been the member of the ‘scheme’, the Head of Office shall issue a sanction for the payment of the member’s accumulation in the Savings Fund after obtaining a simple application in Form No.4.

11.2 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 Govt. servant concerned in Form No.5 to submit an application in Form No.6 and on receipt thereof shall issue sanction for the payment of the amount of insurance and the accumulation in the Savings Fund to him (them).

11.3 In the event of death of a member of the ‘scheme’ while in service, if a person, who is eligible to receive insurance amounts, is charged with the offence of murdering the member of the ‘scheme’ or abetting in the commission of such an offence, his/her claim to receive insurance amounts shall remain suspended till the conclusion of the criminal proceedings instituted against such a person.

If, on the conclusion of the criminal proceedings, the person concerned is convicted for the murder or abetting in the murder, he/she shall be debarred from receiving his/her share of insurance amounts, which shall be paid in equal shares to other eligible persons. However, on the conclusion of the criminal procedings, if the person concerned is acquitted of the charge of murdering or abetting in the murder, his/her share of insurance amounts shall be paid to him/her without any interest thereon.

11.4 If a member of the ‘scheme’ is missing and has not been traced, the insurance cover shall be paid to the nominees/heirs of the missing person after expiry of a period of 7 years following the month of disappearance of the member provided the claimants produce a proper and indisputable proof of death or a decree of the court that the employee concerned should be presumed to be dead as laid down in Section 108 of the Indian Evidence Act.

The accumulation in the Savings Fund may, be paid to the nominees/heirs after lapse of a period of one year following the month of disappearance subject to the fulfilment of the following conditions :-

i) The family must lodge a report with the concerned Police Station and obtain a report that the employee has not been traced after all efforts had been made by the police.

ii) An Idemnity Bond should be taken from the nominees/heirs of the employee that all payments shall be adjusted against the payment due to the employee in case he/she appears on the scene and makes any claim.

11.5 Full Subscription at the rate applicable on the date of disappearance of the employee will continue to be recovered every month from the nominees/heirs of the missing employee for a period of one year following the month of disappearance.

Thereafter premium for insurance cover at the rate of Rs. 4.50 per month for every Rs. 15000/- of the insurance cover will be recovered for a further period of six years or till the month in which insurance cover is paid, whichever is later. It will, however, be permissible if recovery of full subscription for one year together with interest thereon at the rate admissible on the accumulations in the Savings Fund is made from the Savings Fund amount to be paid after one year.

Similarly, premium for the next six years at the rate of Rs. 4.50 per month for every Rs. 15000/- of the insurance cover may also be recovered together with interest thereon at the rate admissible on the accumulations in the Savings Fund from the insurance amount to be paid after expiry of the period of seven years following the month of disappearance.

11.6 Insurance amount shall be paid to the nominees/heirs of the missing employee subject to the fulfillment of the condition mentioned in para 11.4 even if the date of super-annuation of the missing employee falls before the expiry of the period of seven years following the month of disappearance.

11.7 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.

11.8 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.

Example – I
If a Group ‘D’ employee who is a member of the ‘scheme’ since Jan., 1984 acquires membership in Group ‘C’ and Group ‘B’ after 5 years and 15 years of service respectively and dies while in service after 30 yeats of total membership in all these Groups, his nominee (s) shall be paid the sum of the following amounts :-

i) The amount of insurance of Rs.60,000/- due on a monthly subscription of Rs. 60/- 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/- from Jan., 1984 to Dec., 1989 and monthly subscription of Rs. 15/- from Jan., 1990 to Dec., 2013 (total 30 years);

iii) The amount due from Savings Fund on a monthly subscription of Rs. 10 (Rs.20-Rs. 10) from Jan., 1989 to Dec., 1989 and monthly subscription of Rs. 15/- (Rs.30-Rs.15) from Jan., 1990 to Dec., 2013 (total 25 years).;
iv) The amount due from Savings Fund on a monthly subscription of Rs. 30/- (Rs.60-Rs.30) from Jan., 1999 to Dec., 2013 (total 15 years)

Example-2
If a Group ‘D’ employee who becomes a member of the ‘scheme’ since Jan., 1990 acquires membership of Group ‘C’ Group ‘B’ and Group ‘A’ after 5 years, 15 years and 30 years of service respectively and dies while in service after 31 years of total membership in all these Groups, his nominee (s) shall be paid the sum of the following amounts :-

i) The amount of insurance of Rs. 1,20,000/- due on a monthly subscription of Rs.120/- being a Group ‘A’ employee on the date of his death;

ii) The amount due from Savings Fund on a monthly subscription of Rs. 15/- for 31 years.

iii) The amount due from Savings Fund on a monthly subscription of Rs.15/- (Rs.30-Rs.15/-) for 26 years.

iv) The amount due from Savings Fund on a monthly subscription of Rs.30/- (Rs.60-Rs.30) for 16 years.

v) The amount due from Savings Fund on a monthly subscription of Rs.60/- (Rs.120-Rs.60) for 1 year.

11.9 The amount payable to the employee who ceases to be in employment with the Central Govt. on account of resignation, retirement, etc., shall be :-

a) The amount due to him from Savings Fund for the entire period of his membership in the lowest Group; and

b) the amount or amounts due to him for the additional units by which his subscription was raised on ‘each occasion due to appointment, promotion ot higher Group, for the period from which the rate of subscription was so raised to the date of cessation of his membership.

Example -1
If a Group ‘C’ employee who is a member of the ‘scheme’ since Jan., 1983 acquires membership in Group ‘B’ and Group ‘A’ after 10 and 20 years of service respectively and retires on super-annuation after 30 years of total membership in all these Groups, he shall be paid the sum of the following amounts :-

i) The amount due to him from Savings Fund on a monthly subscription of Rs.20/- from Jan., 1983 to Dec., 1989 and monthly subscription of Rs.30/- from Jan., 1990 to Dec., 2012 (total 30 years)

ii) The amount due to him from Savings Fund on a monthly subscription of Rs.30/- (Rs.60-Rs.30) from Jan., 1993 to Dec., 2012 (total 20 years).

iii) The amount due to him from Savings Fund on a monthly subscription of Rs.60/- (Rs.120-Rs.60) from Jan., 2003 to Dec., 2012 (total 10 years).

Example -2
If a Group ‘D’ employee who becomes a member of the ‘scheme’ in Jan. 1991 acquires membership in Group ‘C’ and Group ‘B’ after 15 and 25 years of service respectively and retires on superannuation after 32 years of total membership in all these Groups, he shall be paid the sum of the following amounts:-

i) The amount due to him from Savings Fund on a monthly subscription of Rs.15/- for 32 years;

ii) The amount due to him from Savings Fund on a monthly subscription of Rs.15/- (Rs.30-Rs.15) for 17 years; and

iii) The amount due to him from Savings Fund on a monthly subscription of Rs.30/- (Rs. 60-Rs.30) for 7 years.

11.10 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.

11.11 If any ‘employee’ joins later on all All India Service, his case shall be regulated in such a manner as may be decided by the Ministry of Finance.
Withdrawals from Insurance Fund/Savings Fund

12.1 It will not be permissible for any member or 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 11.8 and paid to his nominee(s) in accordance with the accounting procedure prescribed separately.

12.2 It will not be permissible for any member of the ‘scheme’ to withdraw any amount out the Saving Fund, 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

11.9 and paid to him or his nominee(s) in accordance with the accounting procedure prescribed separately.
Loans/advances from or against accumulation in Insurance Fund/Savings Fund

13.1 No loans or advances shall be paid to any member or other beneficiary of the ‘scheme’ from his/her accumulations in the Insurance Fund/Savings Fund to which he/she has been subscribing.

13.2 A member of the ‘scheme’ who has obtained House Building Advance from the Govt. can assign his/her insurance cover and accumulation in the Savings Fund to a recognised financial institution for the purpose of obtaining additional loans for acquiring a plot of land or a ready built house/flat or for building a house/flat. Permission for assignment of the insurance cover and accumulation in the Savings Fund may be given with the specific approval of the Head of Deptt., if the member of the ‘scheme’ makes a request in writing in Form No.11, subject to the condition that the total amount of House Building Advance sanctioned by the Govt. and the loan raised by the member from the financial institution taken together shall not exceed the cost ceiling limits prescribed by the Ministry of Urban Development.

13.3 If a member of the ‘scheme’ has a plot of land in the name of any member of his/her family and proposes to construct a house on that plot of land or if a member of the ‘scheme’ proposes to acquire a ready-built house/flat or a plot of land in the name of any member of his/her family, he/she will be permitted to assign his/her insurance cover and accumulation in the Savings Fund for obtaining loan from a recognised financial institution.

13.4 The head of Deptt. will communicate his permission for assignment of the insurance cover and accumulation in Savings Fund to the ‘employees’ in Form No. 12. The request of the ‘employee’ in Form No.11 and communication of permission in Form No. 12 will be pasted in the service record of the employee with the following entry in the service record in red ink:-

“(Name of the employee) has been allowed at his/her request to assign his/her insurance cover and Savings Fund accumulation under the Central Govt. Employees Group Insurance Scheme, 1980 to (the name of the recognised financial institution)

“vide letter No….

13.5 At the time of the settlement of the claim of the ‘employee’ or his/her nominee(s) under the ‘scheme’ the amount claimed by the financial institution as due from the employee on account of loan will be paid to the institution without any detailed scrutiny and only the balance amount, if any, will be paid to the employee or his/her nominee(s).
Utilisation of accumulations in Insurance Fund/Savings Fund.

14. The accumulations in the Insurance Fund/Savings Fund shall be at the disposal of the Central Govt. Since the ‘scheme’ is wholly self-supporitng and self-financing, the bulk of these accumulations are proposed to be utilised for ownership housing schemes and other schemes for the benefit of the members of the ‘scheme’

Mode of notification of the scheme

15. 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 a premises where the employees are working. A few copies of the ‘scheme’ may also be supplied to the recognised unions/association the employees.

Action on notification of the ‘scheme’

16. By the 10th of every month follwing the month in which the ‘scheme’ is notified, the Head of Office shall supply to the Drawing & Disbursing Officer names, Groups, dates of birth and date of appointment of persons who may be appointed to any service or post under the Central Govt. 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.

17.1 By the 10th of the month in which the ‘scheme’ came into force the Head of Office had to supply to the Drawing & Disbursing Officers a statement indicating the name, Group and the date of birth of every ‘employee’ who had been in the Central Govt. service on the date the ‘scheme’ was notified, but had not opted out of the ‘scheme’

17.2 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.

17.3 The option exercised by the ‘employees’ who were already in Central Govt. service on the date the ‘scheme’ was notified was to be in Form No.3 which had to be pasted in the service book of the individuals concerned.
Register of members:-

18. The Head of Office shall ensure that Group-wise register of member 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.3 Savings Fund under the ‘scheme’ and to record a certificate to this effect.
Nominations:-

19.1 The Head of Office shall obtain from every 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/her death before attaining the age of superannuation. In the case of ‘employees’ who join Central Govt. service after the date on which the ‘scheme’ is notified such nomination shall be obtained alongwith joining report.

19.2 If a amember of the ‘scheme’ happens to be minor, he/she will be required to make nomination on his/her attaining the age of majority.

19.3 If a member of the ‘scheme’ has a family at the time of his/her making the nomination he/she shall make such nomination only in favour of a member or member(s) of his/her family. For this purpose, family will have the same meaning as assigned to it in the General Provident Fund (Central Services) Rules, 1960 or Contributory Provident Fund Rules (India) 1962, as the case may be.

19.4 If a female member of the ‘scheme’ by notice in writing to the Head of Office expresses her desire to exclude her husband from her family, the husband shall henceforth be deemed to be no longer a member of her family in matters to which the ‘scheme’ relates, unless she subsequently cancels such notice in writing.

19.5 If nominated member(s) of family subsequently cease to be the member(s) of the family, e.g., minor brother crossing the age of minority, marriage of unmarried sister, remarriage of widow before payment of insurance amounts, etc., nomination made in favour of such member(s) shall become invalid.

19.6 If a member nominates more than one person, he/she should specify in the nomination the amount of share payable to each of the nominee(s) in such a manner 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.

19.7 The nomination shall be made in Form No.7 or Form No.8 as is appropriate in the circumstances.

19.8 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.

19.9 The nomination received from the members shall be counter-signed by the Head of Office and pasted in their service books. The Head of Office shall also make an entry in the service book that the nomination has been duly received.

19.10 If a member of the ‘scheme’ dies without leaving behind a valid nomination, the nomination, if made under GPF/CPF Rules may be accepted for the purpose of this ‘scheme’ also. ‘Where there is no nomination even for GPF/CPF accounts, amounts payable under this ‘scheme’ shall be paid as follows:-

a) The entire amount may be paid in equal shares to widow/widows, minor sons and unmarried daughters provided that in the case of more than one widow the second and subsequent marriages were solemnised with the permission of Central Govt.

In the case of minor sons and daughters their mother, who is not a Muslim lady, shall be deemed to be the natural guardian to receive the amount due. Gurardianship Certificate has to be produced by the minor sons and daughters of Muslim lady.

b) In the absence of members(s) eligible under (a) above, the payment may be made in equal shares to other members of the family as defined in General Provident Fund (Central Services) Rules, 1960/Contributory Provident Fund rules (India), 1962.

c) In the absence of member(s) eligible under (b) above also, payment may be made to other legal heir(s) not covered by items (a) & (b) above.

19.11 In the case of claimants covered by items (a) & (b) in para 19.10 the payment will be made by the Head of Office without insisting on production of Succession Certificate but in the event of payment to the claimants covered by item(c) in para 19.10 Succession Certificate issued by a competent court will have to be produced.

20. Central Govt. Employees Insurance Scheme, 1977:-

Central Govt. Employees Insurance Scheme, 1977 introduced by the Dept. of Expenditure O.M.No.60/14/77-IC dated 23rd June, 1977 will continue for those ‘employees’ who have opted out of the Central Govt. Employees Group Insurance Scheme, 1980 till they cease to be in employment with the Central Govt. on account of retirement, resignation, death, etc.
Accounting

21.1 The transactions relating to the ‘scheme’ shall be accounted for in accordance with the procedure laid down separately.

21.2 Govt. dues recoverable from a member of the ‘scheme’ shall not be adjusted from the amounts payable under this ‘scheme’ except as provided in para 13.5.

Interpretation and Clarification

22.1 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.

22.2 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 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.