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Pradhan Mantri Jeevan Jyoti Bima Yojana Creating a Universal Social Security System for the Poor and the Under-privileged

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is one of the ambitious Social Security Schemes of the Government of India, launched by the Prime Minister Narendra Modi on 9 May, 2015. This is an Insurance Scheme offering life insurance cover for death due to any reason, i.e., it covers both natural and accidental death risks. The maximum sum assured offered under this Govt. Scheme is Rs. 2 lakh for a one year period stretching from 1st June to 31st May at a premium of Rs. 330 per annum, or less than Rs. 1 per day, per member and is renewable every year. This is available to all individual savings account holders, of participating banks, in the age group of 18 to 50 years, with life cover extending up to the age 55. Premium paid towards this scheme is eligible for tax deduction under section 80C. In case of multiple bank accounts held by an individual in one or different banks, the person is eligible to join the scheme through one bank account only and insurance cover is restricted to Rs. 2 lakh. Aadhaar is the primary KYC for the bank account. The scheme is offered/administered through LIC and other Indian private Life Insurance companies. Participating Banks are the Master policy holders.

Highlights of The Pradhan Mantri Jeevan Jyoti Bima Yojana


Eligibility : Available to people in the age group of 18 to 50 and having a bank account. People who join the scheme before completing 50 years can, however, continue to have the risk of life cover up to the age of 55 years subject to payment of premium.

Premium :  Rs. 330 per annum.  It will be auto-debited in one installment.

Payment Mode : The payment of premium will be directly auto-debited by the bank from the subscribers account.

Risk Coverage : Rs. 2 lakh in case of death for any reason.

Terms of Risk Coverage : A person has to opt for the scheme every year.  He can also prefer to give a long-term option of continuing, in which case his account will be auto-debited every year by the bank.

Who will implement this Scheme? : The scheme will be offered by Life Insurance Corporation and all other life insurers who are willing to join the scheme and tie-up with banks for this purpose.


Government Contribution :

(i)      Various other Ministries can co-contribute premium for various categories of their beneficiaries out of their budget or out of Public Welfare Fund created in this budget out of unclaimed money.  This will be decided separately during the year.

(ii)   Common Publicity Expenditure will be borne by Government.

The assurance on the life of the member shall terminate on any of the following events and no benefit will become payable there under : (1) On attaining age 55 years (age near birth day) subject to annual renewal up to that date (entry, however, will not be possible beyond the age of 50 years). (2) Closure of account with the Bank or insufficiency of balance to keep the insurance in force. (3) In case a member is covered under PMJJBY with LIC of India/other company through more than one account and premium is received by LIC/other company inadvertently, insurance cover will be restricted to Rs. 2 lakh and the premium paid for duplicate insurance(s) shall be liable to be forfeited. (4) If the insurance cover is ceased due to any technical reasons such as insufficient balance on due date or due to any administrative issues, the same can be reinstated on receipt of full annual premium, subject however to the cover being treated as fresh and the 45 days lien clause being applicable.

Over last one year, government has launched various flagship social security schemes with an objective of broadening financial inclusion in India. This was done to make financial services such as banking, insurance, and others available to the Indian citizens especially from the low & middle class category at an affordable cost and make them financially secure. And lots of efforts are being taken to increase the subscribers under each of these schemes.

The Union Finance Minister, Shri Arun Jaitely while presenting the Union Budget 2015-16, had stated that a large proportion of India’s population is without insurance of any kind – health, accidental or life, worryingly, as our young population ages, it is also going to be pension-less. Encouraged by the success of the Pradhan Mantri Jan Dhan Yojana, the Finance Minister announced three ambitious Social Security Schemes pertaining to the Insurance and Pension Sectors, namely Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJY), Pradhan Mantri Suraksha Bima Yojana and Atal Pension Yojana to move towards a universal social security creating system for all Indians, targeted especially for the poor and the under-privileged. PMJJBY is the cheapest life insurance policy with annual premium of Rs. 330, or less than Rs. 1 per day per member and moreover does not require any medical examination as required for other policies. Objective of the policy is to provide financial security to the family of policy holder in an event of his/her death.

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