The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a government-backed life insurance scheme in India launched in 2015. It aims to provide financial protection to individuals in the age group of 18 to 50 years who hold a bank account and consent to join the scheme. Aadhar, the unique identification number, serves as the primary Know Your Customer (KYC) document for the bank account holders. The PMJJBY offers a life cover of Rs. 2 lakhs, valid for a one-year period from 1st June to 31st May, which can be renewed annually. In the unfortunate event of the insured’s death due to any reason, a sum assured of Rs. 2 lakhs is payable to the nominee. This scheme is facilitated by Life Insurance Corporation (LIC) and other participating life insurers who offer the product on similar terms with the necessary approvals and bank tie-ups.
Coverage and Premium:
Under the PMJJBY, individuals between 18 and 50 years of age can avail themselves of the life insurance coverage. The scheme offers a life cover of Rs. 2 lakhs, ensuring financial security for the insured’s family in the event of their untimely demise. The coverage period spans from 1st June to 31st May of the following year, allowing individuals to renew their policy on an annual basis. It is important to note that the coverage is available regardless of the cause of death, providing comprehensive protection to the policyholder.
To participate in the scheme, individuals must pay an annual premium of Rs. 436 (old :446 ). This premium amount is auto-debited from the subscriber’s bank account as a single installment, as per the option chosen by the policyholder on or before 31st May of each coverage period. The affordable premium ensures that a large section of the population can access life insurance coverage and safeguard their loved ones’ future.
Enrollment Process and KYC:
To enroll in the PMJJBY, individuals must meet certain eligibility criteria. They should be aged between 18 and 50 years and hold an active bank account. The Aadhar card, a unique identification number issued by the government, serves as the primary KYC document for the bank account. Aadhar’s widespread usage in various government welfare programs and financial services has made it a convenient and reliable form of identification.
To enable auto-debit for the premium payment, policyholders need to provide their consent to the bank. The auto-debit facility ensures a seamless payment process, reducing the chances of policy lapses and ensuring continuous coverage. The simplicity and efficiency of the enrollment process make the PMJJBY accessible to a wide range of individuals, promoting financial inclusion and social security.
Role of Life Insurance Corporation and Other Insurers:
Life Insurance Corporation (LIC), a renowned government-owned insurance company, plays a pivotal role in implementing the PMJJBY. LIC, along with other life insurance companies, offers the scheme to the public on similar terms and conditions. These insurers enter into tie-ups with banks to facilitate the enrollment and premium payment process. This collaboration between insurers and banks ensures a widespread reach of the scheme, making it accessible to individuals across the country.
The involvement of multiple insurers not only enhances competition but also offers individuals the freedom to choose their preferred insurance provider. This healthy market competition encourages insurers to provide efficient services, customer-centric policies, and prompt claim settlement, ultimately benefiting the policyholders.
Renewability and Long-term Benefits:
One of the significant advantages of PMJJBY is its renewability feature. Policyholders have the option to renew their coverage on an annual basis, allowing them to enjoy the benefits of the scheme for an extended period. The renewability aspect ensures that individuals can sustain their life insurance coverage and maintain financial protection for their families.
Moreover, the PMJJBY provides long-term benefits beyond just the life cover. By instilling a savings habit and creating awareness about the importance of insurance, the scheme promotes financial literacy among individuals. It helps individuals understand the significance of planning for unforeseen circumstances and encourages responsible financial decision-making.
The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a commendable initiative by the Indian government to provide affordable life insurance coverage to a significant portion of the population. The scheme’s focus on individuals in the age group of 18 to 50 years, along with its ease of enrollment and affordable premiums, promotes financial inclusion and social security.
Through partnerships with Life Insurance Corporation (LIC) and other participating insurers, the scheme ensures a competitive and efficient insurance market. The renewability feature allows policyholders to continue their coverage, providing long-term financial protection for their loved ones.
PMJJBY not only offers a life cover of Rs. 2 lakhs but also imparts financial awareness and a sense of security among individuals. By encouraging responsible financial planning, the scheme plays a crucial role in building a financially resilient nation.
In conclusion, the PMJJBY serves as a vital step towards bridging the insurance gap in India, ensuring that more individuals have access to life insurance coverage and the accompanying peace of mind.
Lets Check Shortly….
-> Finance Minister Arun Jaitley announced in Budget 2015.
-> PMJJBY is a renewable insurance plan. If you die, you will get up to 2 lakhs
-> Who can benefit from it:
- Any savings bank account holder
- Between 18 and 50 years of age can avail this scheme
- Linking Aadhaar with account is mandatory to avail the benefits offered in this scheme
- The death benefit will be available to the nominee.
- The cover is for one year. (June 1 to May 31). It is renewable every year
- Life Cover Rs. 2 lakhs available for just Rs. 436per annum
-> As on May 8, 2017, around 3.11 crore people applied for the scheme and around 65,083 claims were made.