The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), established in 2015, is a one-year life insurance policy renewed yearly and provides death coverage. Both public and private insurance organizations manage Prime Minister Jeevan Jyoti’s insurance scheme in collaboration with scheduled commercial banks, regional rural banks, and cooperative banks.
The government has placed a strong emphasis on the insurance industry as most of the population lacks access to insurance coverage. This Prime Minister’s insurance yojana was designed to encourage the spirit of inclusive growth in parallel with the ‘Sabka Saath Sab ka Vikas‘ and include the impoverished and underprivileged sections of society. The government contributed to this scheme by paying Rs. 14,144 crores in claims under PMJJBY.
Benefits of PM Jeevan Jyoti Bima Yojana:
The life insurance policy has many socio-economical benefits for the citizens, some of which are:
- The PMJJBY provides the policy’s nominee with a death benefit of Rs 2 lakh if the insurance holder passes away.
- Since this is a self-monitoring and self-insurance policy, the PMJJBY does not provide a survivor benefit or maturity benefit.
- A tax exemption is available for the policy premium under section 80C of the Income Tax Act. The proceeds of a life insurance policy that exceed Rs. 1 lakh will be subject to a 2 percent tax if the insured individual does not complete certain forms.
- The Pradhan Mantri Jeevan Jyoti Bima Yojana enrollment period runs from the first of June of every fiscal year to the last day of June of the following year. The subscribers must enroll and give people their self-debit consent within the enrollment period.
- The Pradhan Mantri Jeevan Jyoti Bima Yojana provides Rs. 2 lakh coverage. In the event of an untimely death of the policyholder during the policy’s term, coverage is provided to the scheme beneficiary. The nominee will get a tax-free death benefit from the life insurance policy.
Eligibility of the PM Jeevan Jyoti Bima Yojana:
- Anyone with a savings account between the ages of 18 and 50 can enroll in the program through partner banks.
- Even if a person has multiple savings accounts, they can only use one of those accounts to subscribe to this policy.
- The Aadhaar card must be connected to a participating bank account to receive the plan’s benefits.
- The maximum maturity of insurance is at age 55, with the minimum age for applying being 18 and the maximum age being 50.
Who Implemented PM Jeevan Jyoti Bima Yojana and Why?
The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a government-provided life insurance program in India, launched on May 9, 2015. Formerly, insurance covered only 20% of Indians; the then Finance Minister first put forth the idea during his budget speech in 2015. The PMJJBY was introduced to enhance life insurance penetration among citizens.
Things To Remember Before Enrolling:
- The coverage period runs from June 1 to May 31. Subscribers must enroll and provide auto-debit approval by May 31, 2021, for the cover period of June 1, 2021, to May 31, 2022. Those who join later would be allowed to pay the entire annual fee for projected coverage.
- Earlier life cover of Rs. 2 lakhs is provided under the PMJJBY plan of a premium of 330 Rs. insurance per member is renewed annually. In the event of a joint account, all account holders are eligible to join the plan if they match the qualifying conditions and pay the premium of Rs.330 per person per year.
- PMJJBY risk cover is only available after the first 45 days of enrollment. In other words, insurers are not required to resolve claims during the first 45 days following enrolment. On the other hand, accidental deaths will be immune from the lien provision and can still be reimbursed.
Interesting Facts & Achievements Related to PMJJB Yojana:
- 45 days following the date of enrolment, the life insurance coverage begins. However, in the event of a fatal accident, the total promised amount will be paid. The policyholder can quickly rejoin the scheme even if they leave it for whatever reason.
- Following Section 80C of the Income Tax Act of 1961, contributions made to this plan may qualify for tax deductions.
- As an achievement, More than 12.76 million people had enrolled in the program overall as of April 27, 2022, and Rs. 11,522 crores had been paid for 5,76,121 claims.
Note:
Lack of funding inclusion is likely to be a significant challenge for India as its population grows. Approximately 72% of Indians live in rural areas of the nation and rely heavily on daily wages for survival. However, they can assure their happiness and well-being by the PMJJBY.
The PMJJBY initiative is anticipated to pick up steam in the coming years and reach its objective of complete financial inclusion for the nation. Additionally, the scheme has experienced exponential growth (in enrollments) throughout the COVID-19-induced lockdown in 2020 and 2021 and the ongoing government publicity as a pure protection term insurance.