After a lot of speculation and anticipation about the social security schemes that the Modi government was set to announce, the Pradhan Mantri Suraksha Bima Yojana (PMSBY) has finally been launched. The honourable Prime Minister announced a total of three social security schemes that aim to bring the overall population under the umbrella of insurance. Apart from this accident insurance scheme, the government has also launched schemes for retirement as well as life insurance.

What is Pradhan Mantri Suraksha Bima Yojana?

Pradhan Mantri Suraksha Bima Yojana is a government-led accident insurance schemes that aims to provide accident insurance to all Indians in the unfortunate event death or permanent disability on account of an accident. This scheme is applicable for Indians under the organized as well as unorganized sector of labour. The scheme is linked to various public sector banks and units and major private banks also who have agreed to collaborate.

In a country like ours, where insurance percentage is even below the world average of 6.3%, schemes like the PMSBY are a great push towards insuring a huge chunk of population. Some of the main distinguishing features that set it apart from other such government-run insurance schemes are –

  • Extremely low premium payment
  • Higher coverage of up to Rs.2 Lacs
  • First time when social-security schemes have been linked with bank accounts to help unorganized sector be a part of the scheme and to foster deeper penetration across the country
  • Higher inclusivity; both unorganized and organized sector people can avail this policy

Salient features of Pradhan Mantri Suraksha Bima Yojana

  • PMSBY is an accident insurance scheme aimed at providing monetary support to people who lose their lives or are disabled permanently because of accidents
  • Accidental insurance scheme which can be renewed annually
  • A premium of Rs.12 per annum is to be paid by a policyholder
  • Sum assured is Rs.2 lacs in the unfortunate event of death or disability due to accident
  • People between the age of 18-70 years can apply for this insurance scheme
  • PMSBY specially aims to provide coverage to people from the rural sector and the unorganized sector who have an extremely low percentage of insurance but are the most susceptible to accidents and injury
  • Auto-deduction of premium from customer’s bank account; subject to consent of the customer
  • Option to renew PMSBY scheme annually or to take it for a long-term period

Eligibility Criteria:

  • Age Group – 18-70 years of age
  • Any person having a bank account can avail this scheme
  • Name of the nominee should be included in the application
  • Even if a customers has multiple savings accounts, he/she can joint his scheme through just one of the many accounts

How does PMSBY works?

It is not an easy task to implement an insurance scheme that covers the whole population of the country. Hence, the scheme is being provided through all major banks so that no single entity has to do the colossal amount of work involved. The scheme has certain simple basic steps that will ensure coverage with minimum effort and complexity.

  • The premium of Rs.12 per annum will be debited from customer’s savings account
  • Customer’s consent is required before banks debit that amount and start this insurance plan on customer’s name
  • PMSBY is valid from June 2015 to May 2016 after which the policy needs to be renewed every year
  • For this year, 31st May is the last day to join this policy
  • Extension being given for joining this policy is till 31st August 2015

Benefits of PMSBY

1) On death of policyholder, due to accident an amount of 2 lac rupees will be paid to the nominee

2) In case of total and irrecoverable loss of eyes, hands or legs due to accident, an amount of 2 lac rupees will be paid to the policyholder

3) In case of total and irrecoverable loss of one eye or one hand, a sum of 1 lac rupees will be paid to the policyholder

The cover of the PMSBY insurance scheme ceases in case the policyholder attains the age of 70 or if his/her bank account is closed due to insufficient balance in the account through which policy premium is paid or in case the same policyholder is covered in this scheme through more than one savings account

Which insurance company will offer the PMSBY?

PMSBY will be offered majorly by public sector insurance companies like the New India Assurance and the Life Insurance Corporation of India. However, private general insurance companies can also step forward and collaborate if interested. Private Banks are free to engage any general insurance company for offering the PMSBY scheme to their customers. Examples of companies that will be offering this accident insurance scheme are National Insurance Company Limited, ICICI Lombard, Oriental Insurance Company Limited, etc.

About the Author:

Sanjit Agarwal, a Financial Writer by profession, holds a rich experience of around six years in Personal Finance industry. He loves to write and share reviews, updates, tips, case studies and more on Investments, Money Management, Retirement Planning, Tax, Savings, Insurance and more. Currently, he is giving his services as Financial Writer for health insurance, at BankBazaar.

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0 responses to “Pradhan Mantri Suraksha Bima Yojana – All you need to Know”

  1. Bhagwandas Gupta says:

    THIS IS A GOOD SCHEME FOR THE DEPENDENT/ NOMINEE OF THE PERSON WHO IS INSURED.IN CASE OF SUDDEN DEATH BY ACCIDENT OR DUE TO ANY CAUSE ,OF THE INSURED PERSON , DEPENDENT CAN BE BE IMMEDIATELY BENEFITED FINANCIALLY BY THE NATIONAL INSURANCE THROUGH THE BANK(S.B.I). OUR P.M.IS WORTHY OF THANKS FOR THIS.PLEASE MAKE IT CLEAR IS THIS GIVE THE COVER FOR THE DEATH DUE TO SUDDEN ACCIDENT OR DEATH CAUSED BY ANY OTHER REASON.AS I KNOW S.B.I IS ALSO GIVING GROUP PERSONAL ACCIDENT INSURANCE POLICY TO ITS CUSTOMERS/SAVINGS ACCOUNT HOLDERS.BOTH ARE GOOD SCHEMES BUT WHAT IS THE DIFFERENCE IN BETWEEN THESE TWO ?.IS IT RS 12/-PER ANNUM FOR GROUP PERSONAL ACCIDENT INSURANCE POLICY RUB NY SBI.GENERALINSURANCE FOR THE INSURED PERSON BETWEEN AGE GROUP FROM 18 TO 65 YEARS.I NEED THE CONFUSION TO BE REMOVED AT YOUR LEVE.I HAVE CROSSED 65,MAY I TAKE FROM SBI GENERAL INSURANCE ,GROUP PERSONAL ACCIDENT INSURANCEPOLICY OR NOT ELIGIBLE NOW.

  2. chanakya says:

    past 70 and u r worthless. Some seasoned insurer seems to have ill-advised Narendra. For Health insurance, too, the age limit precludes the elderly. This exclusion by Narendra as well as the insurers at large is almost only a little shorter than consigning the dependants to gas chambers. No one seems willing to discharge that responsibility. This is not only inhuman but perhaps unconstitutional as well.

  3. Sanjit Agarwal says:

    @Roy,

    Yes, you can enroll for this scheme in next period. However, extension is provided till 31/08/2015 for people who cannot join till 31/05/2015.

    @Pushp Lata,

    Rs.12 pa is for PMSBY (personal accident insurance) and Rs.330 is for Pradhan Mantri Jeevan Jyoti Bima Yojana (life insurance scheme).

  4. anup says:

    Good one, some of the banks are saying that it is not available if person is having such cover under any other policy. Is it so? Please also clarify position on same issue for Pradhanmantri Jivan Jyoti Vima Yojna also. Thanks

  5. Roy says:

    Dear Sir,

    Due to some reason i am not able to take this insurance policy before 31/05/2015. In this case can i join this scheme in the next renewal i.e. 01/06/2016 to 31/05/17. please let me know.

    Regards,
    Roy

  6. pushp lata says:

    thank for sharing this article but Rs.12 pa is for accidental insurance and one another PMSBY there very similar to this for Rs.330 pa please clarify that ??

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