Pradhan Mantri Suraksha Bima Yojana (PMSBY – Scheme 1 – for Accidental Death Insurance) are
- Eligibility :- Available to people in age group 18 to 70 years with bank account.
- Premium :- Rs 12 per annum.
- Payment Mode :- The premium will be directly auto-debited by the bank from the subscribers account. This is the only mode available.
- Risk Coverage :- For accidental death and full disability – Rs 2 Lakh and for partial disability – Rs 1 Lakh.
- Eligibility :- Any person having a bank account and Aadhaar number linked to the bank account can give a simple form to the bank every year before 1st of June in order to join the scheme. Name of nominee to be given in the form.
- 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 all Public Sector General Insurance Companies and all other insurers who are willing to join the scheme and tie-up with banks for this purpose.
- The premium paid will be tax-free under section 80C and also the proceeds amount will get tax-exemption u/s 10(10D).But if the proceeds from insurance policy exceed Rs.1 lakh , TDS at the rate of 2% from the total proceeds if no Form 15G or Form 15H is submitted to the insurer.
In a move to provide accident insurance cover to every India, the Pradhan Mantri Suraksha Bima Yojana was launched as a government backed insurance scheme. Originally conceptualised in the budget speech of 2015 by the Finance Minister, the official announcement was made in Kolkata on 9th May 2015.
The salient features of the scheme interalia, include providing accident insurance upto Rs 2,00,000/- in case of death of the insured and in case of partial disability an amount of Rs 1,00,000/- is paid. The premium is attractive which is capped at Rs 12/- and an additional amount of 14% is levied as service tax over and above the Rs 12/-. The premium amount is deducted directly from the Bank account of the insured person.
The bank account opened as part of Pradhan Mantri Jan Dhan Yojana which were opened as zero balance initially will be linked to this scheme that will go a long way in ensuring reduction in the number of zero balance accounts.
Criticism
There has been criticism amongst various quarters of the industry especially the bankers who mention that the premium collected under the scheme is too less which does not even cover the service costs.
Mode of Payment of Premium
At the time of enrolment into the scheme, auto debit mandate is received by banks, who deduct the amount directly from the bank account of beneficiary in one go on yearly basis. The auto debit option can also be chosen for longer periods till existence of the scheme with a clause of re-calibration from time to time.
Termination of Benefit Cover
The benefit under this scheme will be terminated on following instances
1) Upon the subscriber attaining the age of 70 years or nearest thereto. (2) Due to closure of bank account or insufficient balance in the account at the time of renewal (3) in case of multiple accounts and repeated premium paid on all accounts intentionally by the subscriber, then the benefit is restricted to only one account and premium paid on other accounts is forfeited. (4) If the insurance policy is withdrawn for insufficiency of balance in account or administrative reasons or any other reasons, the same can be revived at sole discretion of Insurance Company provided, full premium is paid and that the policy is issued with prospective effect. During such revival period, the benefits under this scheme will be suspended. The renewed insurance over and risk cover is issued later on by the insurance company.
The participating banks under the Pradhan Mantri Suraksha Bima Yojana are mandated to auto-debit the premium amount from subscribers preferably in month of May every year or the month of commencement of policy. Further, the amount is debited has to be remitted by the banks to insurance company within the same month.
MORE INFORMATION :-
1. PMSBY RULES
The PMJJBY can be availed by Indian citizens in the age group of 18-55 years. In case of death the nominee of insured gets Rs 2 Lakhs. The payment of premium is deducted directly from the Bank account. The premium is Rs 3300/- plus service tax at 14%. Therefore though the premium is less the additional service tax of 14% is to be paid at the time of availing insurance cover under this scheme.
The insurance policy is thereafter linked to the bank account which can be opened with zero balance in the first instance. The Government aims at launching numerous schemes like PMJJBY to reduce the instances of zero balance bank accounts.
- 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 instalment.
- 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.
Who will Offer the programme
The plan is administered by Life Insurance Corporation of India which also undertakes the processes for settlement and administration procedures. The procedures are aimed to be simple and user friendly to the subscribers. The policies and procedures governing the policy, claims, settlement and other aspects is carried out in consultation with participating banks. Other insurance providers can also joint he scheme through tie ups with specified banks who will then be identified as master account holders for the purpose of PMJJS
How can One Enroll
This being a term policy is applicable for the period commencing from 1st July 2015 till 31st May 2016. Therefore, the persons intending to join the scheme will have to submit application at prescribed branches of banks prior to 31st May 2015. However, the time will be extended to 31st August, being first year of launch of the policy provided that the applicant pays entire premium amount and submits self-declaration of being in good health. Further, if someone intends to continue the policy period beyond the first year, they have to again submit a declaration of being in good health and authorise bank to deduct the premium amount on or before 31st May of respective year. The same procedure is applicable for people who leave the policy after a year of payment of premium and then intend to re-join at a later period.
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