TGLI Loan Sanctioning Guidelines to Policyholders on their Policy

The Telangana State Government Life Insurance (TGLI) Scheme provides detailed guidelines for sanctioning loans to policyholders.

These guidelines are essential for policyholders and Drawing and Disbursing Officers (DDOs) to ensure the proper calculation and collection of loan interest and Equated Monthly Installments (EMI).

The guidelines outlined in G.O.MS.No. 34, dated 09-04-2015, provides a structured approach to loan management under the TGLI scheme.

Key Highlights of TGLI Loan Sanctioning Guidelines

1. Interest Calculation on TGLI Loans:
   • The Telangana State Government mandates the collection of simple interest on loans sanctioned under the TGLI scheme.
   • Interest is calculated using the diminishing balance method and included in the EMI, ensuring that principal and interest are systematically recovered.
2. Role of Drawing and Disbursing Officers (DDOs):
   • DDOs are responsible for calculating and recovering the EMI, including the principal and the expected interest amount.
   • DDOS must recover the interest simultaneously with the principal to avoid any financial strain on the Life Insurance Fund.
3. Adjustments and Audit Compliance:
   • Any discrepancies in interest recovery should be adjusted during subsequent loans or at the time of claim settlement.
   • The guidelines aim to prevent audit objections and ensure that the TGLI Fund remains financially stable.
4. Procedure for Loan Sanctioning:
   • The Director of Insurance is authorized to calculate the expected interest at the time of loan sanctioning.
   • The calculated EMI, comprising principal and interest, is communicated to the relevant DDOs for prompt recovery.
5. Government Orders and References:
   • The guidelines are based on several government orders and circulars, including G.O.Ms.No.83, Finance (Admn. II) Department, and Circular.Memo.No.707/119/A2/Admn-II/2013, which outline the responsibilities of DDOs in managing TGLI loans.

Importance of Adhering to TGLI Loan Guidelines

Following these guidelines is crucial for the smooth operation of the TGLI scheme. Proper management of loan interest and EMI safeguards the Life Insurance Fund and ensures that policyholders are not burdened with unexpected financial liabilities.

Policyholders can benefit from transparent and efficient loan management by adhering to the procedures outlined in these guidelines.

Policyholders and DDOs can download the complete TGLI Loan Sanctioning Guidelines from the official TGLI website for more detailed information.