Two of the central government's most popular insurance programs, Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY), will see a rise in the amount insured. The Center may expand coverage under both programs from the existing Rs 2 lakh to Rs 5 lakh in the lead-up to the crucial state Assembly elections in Maharashtra, Haryana, and Jammu and Kashmir, according to a Livemint article.
"In order to solve the issue of a protection gap in the insurance coverage, the amendments are being explored. Increased coverage will give an insured or dependant the necessary amount to satisfy their financial commitments." According to a source familiar with the planned development, Livemint, "the idea is that a Rs 5 lakh cover under the schemes would help to bridge this protection gap substantially." At now, there are about 200 million members to PMJJBY, and 453.6 million people are enrolled in the PMSBY program. Part of the government's "insurance for all by 2047" agenda is the drive to expand coverage. This is particularly important because India's insurance penetration, or the ratio of premiums to GDP, is only 4%, which is still less than the 6.8% global average.
Following the proposed increase in insurance cover, individuals will be able to choose between taking the higher cover and paying an increased premium or continuing with the existing Rs 2 lakh cover at a premium of Rs 20 per year per member of a family for PMSBY and Rs 436 per year per member for PMJJBY. So yet, the Ministry of Finance has not published a remark on this matter.
Centre-run Insurance Plans
In May 2015, Prime Minister Narendra Modi unveiled three schemes: PMJJBY, PMSBY, and Atal Pension Yojana.
PMSBY is a one-year personal accident insurance plan. It is renewed from year to year and provides coverage against death or disability in the event of an accident. The entire sum payable in the event of death in an accident is Rs 2 lakh, whereas the compensation for handicap caused by an accident varies from Rs 1-2 lakh. PMSBY is offered to persons aged 18 to 70 who have bank accounts. The premiums for the program will be debited from the insured's savings account.
Meanwhile, PMJJBY provides life insurance in the event of death of the insured. It is available through the Life Insurance Corporation of India (LIC) and other life insurers and banks that are ready to provide the program on comparable conditions. Indian citizens aged 18 to 50 who have a bank account are eligible for the plan.
