Sunday, July 10, 2011

Payment of Incentive to DO (PLI) - Revision thereof and the condition s for extension of the tenure of DO (PLI)

Copy of the Directorate letter No. No.25-4/2002-LI,   Dated: 25.05.2011

To
                All Heads of Circles / All Heads of the Regions / The Addl. DG of APS, C/o 56 APO
                The Director, Postal Staff College, Ghaziabad / The Directors, PTCs
                The Director of PLI, 7 Koilaghat Street, Kolkata-1 / The Directors/Dy. Directors Accounts (Postal)
                The DG, P&T Audit, Delhi / All DDMs (PLI).

Sub:       Payment of Incentive to DO (PLI) – Revision there of and the conditions for extension of the tenure of DO (PLI).

Ref:        Earlier references on the above subject.
(i)             Letter No.25-4/2002-LI dated 22.7.2004,    (ii)   Letter No.25-4/2002-LI dated 18.03.2005 and   (iii)   Letter No.25-4/2002-LI dated 14.11.2006.

Reference is invited to PLI Directorate’s letters cited above.  The incentive free business for DO (PLI) was last revised under this office letter of even number dated 18.3.2005.  The average sum assured of new business in PLI at that time i.e. in 2004-05 was Rs.1.1 lakh.  The average sum assured of new business in PLI has now more than doubled to Rs.2.24 lakhs in 2009-10.  Accordingly, the incentive free business for DO (PLI) needs to be raised at least in the same proportion.  Moreover, during this period, the income of eligible clientele has also gone up considerably on account of revision of pay etc.  The matter was, therefore, considered and it has been decided by the competent authority to increase the limit of incentive free business for DO (PLI) from Rs.4 crore to Rs.9 crore.

2.             Subsequent to increase in limit of incentive free business as proposed in above para, the revised incentive structure of DO (PLI) would be as under:


Upto Rs.9 Crore of Sum Assured
Nil
Above Rs.9 Crore and upto Rs.11 Crore of Sum Assured
Rs.25/- per Rs. ten thousand of Sum Assured
Above Rs.11 Crore of Sum Assured
Rs.20/- per Rs. ten thousand of Sum Assured


3.             Further, under Directorate letter of even number dated 22.07.2004, a DO (PLI) was required to procure a minimum business every year to make him eligible to work as DO (PLI) in the next year.  To procure business, DO (PLI) need to familiarize himself/herself with business procurement techniques and also with the eligible clientele.  DO (PLI) should, therefore, be appointed for a minimum tenure.  It has, therefore, been decided that a DO (PLI) will initially be appointed for a tenure of three years.  DO (PLI) would be eligible for extension of tenure in subsequent years as follows:

(a)           To get extension for 4th and 5th year, the DO (PLI) should have  procured
average business of Rs.10 crores in first two years.
(b)           To get extension for 6th and 7th year, the DO (PLI) should have  procured
average business of Rs.12 crores   in the 3rd and 4th year.
(c)            To get extension for 8th and 9th year, the DO (PLI) should have  procured
average business of Rs.14 crores in 5th and 6th year.
(d)           To get extension for  the 10th  year,  the DO (PLI)  should have  procured
average business of Rs.16 crores in 7th and 8th year.
(e)           For   extension    beyond   10   years,   the   DO (PLI)    should    procure   
minimum   business  of  Rs.20 crores  in  each  year.

4.             However, continuation of DO (PLI) in any year as stated in para 3 above, is subject to the condition that the DO (PLI)  should have procured business of not less than Rs.9 crores in the previous financial year. For example, a DO (PLI) may get an extension for 6th and 7th year as he procured average business of Rs.12 crores in the 3rd and 4th year.  However, if at the end of the 5th year if the DO (PLI) has procured a business of less than Rs.9 crores in the 5th year, the DO (PLI) would be terminated immediately thereafter notwithstanding the fact that he was earlier given an extension of tenure for the 6th& 7th year.  Circles should, therefore, evaluate the performance of the DO (PLI) within two months of the close of the previous financial year and in case, it is found that the DO (PLI) has procured a business of less than Rs. 9 crores in the previous financial year, he should be terminated immediately thereafter.

5.             DO (PLI) procuring business exceeding Rs.25 Crores in a year would be designated as Sr. DO (PLI) and would be provided additional facility by way of infrastructure support and training in specialized Marketing and Insurance Institutes. 

6.             These orders would be applicable from current financial year 2011-12.

7.             This issues with the approval of the competent authority.

( HenaUsman )
Addl. General Manager (PLI)

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