PMJJBY currently has over 200 million subscribers, while enrollments under the PMSBY scheme stand at 453.6 million | Photo: Shutterstock
The central government is planning to increase the amount covered under two of its flagship insurance schemes – Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY).
According to a Livemint report, the Centre may increase the coverage from the current Rs 200,000 to Rs 500,000 under both schemes in the run-up to the high-stakes state Assembly elections in Maharashtra, Haryana and Jammu and Kashmir.
“The changes are being considered in order to address the protection gap issue in insurance coverage. A higher cover will provide the necessary amount required by an insured or a dependent to meet financial obligations. The idea is that a cover of Rs 500,000 under the schemes would help close this protection gap substantially,” a person aware of the proposed development told Livemint.
Currently, PMJJBY has over 200 million subscribers, while enrolments in the PMSBY scheme stand at 453.6 million. The effort to increase coverage is part of the government’s “Insurance for All by 2047” initiative. This is especially significant as India’s insurance penetration (or the percentage of premiums to GDP) of 4% is still lower than the global average of 6.8%.
Following the proposed increase in insurance cover, people will have the option to take the higher cover by paying a higher premium or continue with the existing cover of Rs 2 lakh, with a premium of Rs 20 per year per family member for PMSBY and Rs 436 per year per member for PMJJBY.
So far, the Ministry of Finance has not issued any statement on the matter.
Insurance plans managed by the center
In May 2015, Prime Minister Narendra Modi launched three schemes: PMJJBY, PMSBY and Atal Pension Yojana.
PMSBY is a one-year personal accident insurance plan, renewable from year to year, that provides protection against death or disability in case of an accident. The total amount payable in case of death in an accident is Rs 200,000, while the payout in case of disability caused by an accident varies between Rs 100,000 and Rs 180,000. PMSBY is available to people between the age of 18 and 70 years with bank accounts. The plan premiums will be deducted from the savings account of the insured.
Meanwhile, PMJJBY offers life cover in case of death of the policyholder. It is offered through Life Insurance Corporation of India (LIC) and other life insurers and banks that are willing to offer the plan on similar terms. Indian residents between the age of 18 and 50 with a bank account can avail the plan.
First published: September 2, 2024 | 10:24 am IS
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