Suppose, there is a family of 4, a father, a mother and their two kids. They are having a peaceful life until one day. That day the husband dies and the family gets shattered. But the husband was intelligent. He had a insurance cover. And after his death, the family got the insured amount so that they can leave happily. Be like the husband.
Pradhan Mantri Jeevan Jyoti Bima Yojana
In a survey done in May 2015, it was found that only 20% of the Indian population has any kind of insurance. This had to be changed because by the use of insurance, we can transfer a risk to another. That is why Prime Minister, Narendra Modi launched a scheme which is know as Pradhan Mantri Jeevan Jyoti Bima Yojana to provide life insurance at a cheap rate.
The Pradhan Mantri Jeevan Jyoti Bima Yojana is the Central Government’s bid to bring affordable life insurance to the masses. All accounts opened under the Pradhan Mantri Jan Dhan Yojana shall be linked to this insurance scheme. This scheme was announced alongside the Pradhan Mantri Suraksha Bima Yojana and the Atal Pension Yojana, in 2015 on the 9th of May. These schemes are all geared towards providing benefits to the poor and the neglected classes in our society. Speaking of the Jeevan Jyoti Bima Yojana, this scheme aims at providing life insurance cover to the tune of Rs. 200000 to the policy holders at an extremely inexpensive premium. The amount shall be paid to the nominees of the person to whom the policy belongs.Central also supported Rashtriya Swasthya Bima Yojana for BPL Category and Mission Indradhanush Health Program For Children.
The Jeevan Jyoti Bima is a scheme that has been initiated by the Central Government to provide a life insurance policy of Rs. 2 lacs to persons who previously had no access to such services. The policy which pays out Rs. 2 lacs to the next of kin, in case of demise of the policyholder requires a premium of only Rs. 330, which is to be paid annually. The nominal premium makes this scheme affordable for everyone, thus now literally anybody can get their lives insured thereby providing some financial security to their families in case of their sudden demise.
Rajasthan State Government also announced Samajik Suraksha Pension Yojana and RAHAT for the betterment of state people. And Uttar Pradesh Government also supports Advance Life Support In Uttar Pradesh .
Salient features of Jeevan Jyoti Bima Yojana
To save you from the chore of poring over the entire scheme document, we shall highlight the key features of the scheme for you. You just need to peruse them once to get an understanding of the entire scheme.
- Premium Amount : The premium for the Jeevan Jyoti Bima Yojana has been kept at a bare minimum Rs. 330. Thus this essentially means that for a payment of less than Re 1 per day, the beneficiaries are getting a cover of Rs. 2 lacs. If you are a stickler for exact figures then this policy shall cost you exactly Rs. 27.5 per month.
- Auto Debit Facility : There is no provision for the individuals to make payments separately for life insurance under this scheme. The premium amount is debited automatically from the bank account itself and requires no human intervention. The individual is only responsible for ensuring that there is sufficient balance in the account when the insurance premium is being debited.
- Risk Coverage : A big benefit of this scheme is that the life cover so provided is not subject to a myriad of terms and conditions, which more often than not baffle the policyholders and their nominees, this is especially relevant in respect of the social strata that this scheme is targeting. Thus under this scheme the payout of Rs. 2 lacs shall be given to the nominees on the demise of the policyholders, irrespective of the cause of death.
- Under the Supervision Of : The scheme is initially being offered by the Life Insurance Corporation of India, however the Government has declared that all other insurers are welcome to join the scheme and tie up with the authorised banks to provide the insurance.
- Renewal Period : Those who have obtained this policy or are desirous of obtaining such policy should take note that the policy has to be renewed yearly, thus it is imperative to maintain sufficient balance in the accounts to pay the yearly premium, to prevent the policy from lapsing.
- Nominee Rule :Those registering under this scheme, at the time of registration shall be required to provide all the details about the person or persons they want to appoint as nominees in the policy and the details of their relationship with them. The policyholder may also be required to substantiate the claims by providing documentary proof. In case the nominees are minors, they have to necessarily specify the name of the guardians of those nominees in the policy document.
- Government Contribution : The amount that the Government will contribute to this scheme is not fixed and shall be decided on a year by year basis. However whatever be the contribution, it shall be made utilising funds that have been lying with the government in a number of public welfare accounts for years and now the period of claiming those amounts is over.
The eligibility criteria for enrolling under this scheme are detailed below.
- Age Limit : The scheme has an age limit, thus applicants who are under the age of 18 or those who are more than 50 years old cannot enroll for this scheme.
- Saving Bank Account Mandatory : Applicants who wish to be registered under the scheme need to have a valid saving bank account in any one of the banks authorised by the scheme. Otherwise the applicant shall have to open a savings bank account in any of the authorised banks before being allowed to enroll for the Jeevan Jyoti Bima Yojana.
- Self Declaration Form : Apart from satisfying the above criteria, registering under this scheme is as easy as filling in an application form and submitting it to any of the banks listed in the scheme document. However these forms shall contain a declaration where the applicants are required to give a self certified undertaking regarding their good health, thereby dispensing with the need of a medical examination by a professional.
The initial policy period was from the 1st of June 2015 till the 31st of May 2016. However each policy period now covers one year from the 1st of June of one year to the 31st May of the next year, and those who want to obtain the benefit of this scheme have to obtain the approval from their respective banks before the commencement of the policy i.e. before the 1st of June. However if the policy period has commenced, those interested can still obtain the cover by paying the entire premium upfront and furnishing a self declaration of being in good health.
How to apply / Enroll In PMJJBY
Individuals are interested in enrolling for this scheme just have to download the application form from the website and after filling it up, have to visit a branch of any participating bank in which they have their savings account and submit the duly filled up form in person. Care should be taken that the balance in the aforementioned savings bank account is sufficient to pay for the premium.
The premium for the Jeevan Jyoti Bima Yojana has been kept at a bare minimum Rs. 330. Thus this essentially means that for a payment of less than Re1 per day, the beneficiaries are getting a cover of Rs. 2 lacs. If you are a stickler for exact figures then this policy shall cost you exactly Rs.27.5permonth.
There is no provision for the individuals to make payments separately for life insurance under this scheme. The premium amount is debited automatically from the bank account itself and requires no human intervention. The individual is only responsible for ensuring that there is sufficient balance in the account when the insurance premium is being debited.
Mode of Payment of the Premium
There is no provision for the payment of premiums under the Jeevan Jyoti Bima Yojana, other than through auto debit from the accounts of the policyholder. Moreover there is no scope of payment in installments, though this may have a lot to do with the fact that the premium amount is extremely nominal. However the applicants must ensure there are enough funds in their accounts to at least cover the premium. The decision taken by the government, for not allowing any modes of payment other than auto debit is a masterstroke with which it aims to kill two birds with one stone. To reduce the burden on the poor, many accounts have become zero balance accounts, which means that there is no minimum balance that has to be maintained in these accounts, thus these accounts remain active even when the account holders do not deposit any money in those accounts. However if everybody starts keeping zero balance in their accounts, the banks will be in trouble because after all they need funds to operate, thus through this decision the government has compelled policy holders to deposit at least the bare minimum amount required to meet the premium expenses in their bank accounts or risk losing their life insurance cover.
Termination of Assurance
Beneficiaries would do well to be aware of certain situations which can cause the termination of the policy and a loss of the insurance cover.
- Firstly since the scheme is age restricted, the insurance cover under this scheme shall automatically terminate on the day the policyholder attains the age of 55. Thus it is clear that people over 55 years of age are not eligible for the scheme.
- The insurance policy provided under the Pradhan Mantri Jeevan Jyoti Bima Yojana is linked to a savings bank account in any of the participating banks. Thus if the account to which this scheme is linked is shut down, it shall cause an automatic termination of the insurance policy.
- The scheme has made it clear that only one insurance cover shall be provided to a person and that it shall be attached to a single account. Thus if any person either unscrupulously or otherwise applies for insurance cover under this scheme, from multiple accounts then all the schemes barring one shall automatically terminate and the premium for those schemes shall be forfeited by the respective banks.
- Another reason why beneficiaries can lose their insurance covers is if the minimum balance in their accounts is not maintained. The scheme is linked to a savings bank account and every year the premium amount is automatically debited from that account, thus if a balance equal to the premium is not maintained in the account then the policy shall stand terminated.
Under this scheme
- Rs. 2,00,000 is paid to the nominee in case of death by any reason.
- The annual premium is Rs. 330.
- It is renewed every year with auto debit facility.
- People between age of 18 and 50 are eligible to apply.
How to apply for Jeevan Jyoti Bima?
- Download form by clicking here.
- Fill up the form.
- Approach your bank branch.
- Submit it to them.
Alternatively, it can be applied directly by net banking or mobile banking for the supported banks.
Till may 2018,
Subscribed : 5.33 crore people
Claims : 60,422 claims
Disbursed : 63,767 claims
Any insurance policy covers instances that happen coincidentally or by happenstance or an accident, willful injury or harm is generally not considered. However as mentioned above, no such conditions have been imposed on this scheme.
The Benefits under the PMJJBY
The scheme provides a life insurance cover of Rs. 200000 in exchange of a very minimal amount as premium, Rs. 330 per annum to be exact. This is one of the biggest benefits of the scheme.
Another small benefit under this scheme is that the applicants need not get a medical certificate from a certified medical practitioner to obtain an insurance cover, a self declaration that they are in good health shall suffice for the purpose of the scheme.
Thanks for reading. This article was bought to you by Hamari Yojana, an initiative by a Political Science student and a CA student. Stay tuned for more articles like this.