If Government consider it necessary, the selected candidate shall be required to insure his life in favour of the Government for a sum equivalent to the total amount of the stipend estimated to be paid. The loanee shall normally pay the premium. In case he is unable to do so and keep the policy in force till such time as the loanee is able to earn, the premium due on the policy may be paid out of the Fund and such payment shall be treated as part of the loan with interest at six per cent per annum from the date the candidate begins to earn, he shall pay the premium submitting premium receipts for inspection. The existence of the policy shall not debar the Government from taking any legal steps for recovery of the amount due. The Insurance Policy shall be assigned by the candidate to the State Government and shall be reassigned by them on the stipendiary repaying all the amounts due. Expenses of assignment and reassignment shall be borne by the loanee.
