Union Bank depositors to get HDFC Life cover

Union Bank of India today signed an agreement with HDFC Standard Life Insurance Company to offer its depositors insurance cover.

Under the 'Union Suraksha' scheme, depositors can get a life cover of Rs one lakh on payment of a nominal premium.

In case of accidental death, an additional sum assured of Rs one lakh will be paid to the depositors nominee.

This over-the-counter product requires no medical examination. Only a declaration of good health is to be given by the depositor.

The bank, which is a licensed corporate agent of the HDFC Standard Life, will charge an admission fee of Rs 50 from depositors who avail of the scheme.

Depositors in the 18-35 years age bracket have to pay an annual premium of Rs 249 while those in the 36-50 years and 51-55 years age brackets have to pay annual premiums of Rs 501 and Rs 1,020, respectively.

Premiums paid will be eligible for tax rebate under Section 88 of the Income Tax Act and the claim amount is exempted under Section 10(10D) in the hands of the nominees.

"Initially this scheme will be implemented in the metropolitan and urban centres only. Though the cover is initially available for 12 months, the policy can be renewed on a roll over basis by providing standing instructions to the bank's branches," V Leeladhar, chairman and managing director, Union Bank of India.

A bank official explained that in case husband and wife hold a joint account both could avail of the insurance cover.

While the former pays the full premium amount the latter will pay half the amount. Union Bank is the third public sector bank to launch insurance cover for depositors. State Bank of India and Corporation Bank had launched their schemes last year.

The bank, which became a corporate agent in December 2002, succeeded in marketing about 22,000 life insurance proposals for sum assured of Rs 225 crore. Aggregate preimums amounted to about Rs 16 crore.