All About Pradhan Mantri Suraksha Bima Yojana or PMSBY

All About Pradhan Mantri Suraksha Bima Yojana or PMSBY

The scheme was launched in support of an accidental Death and Disability insurance scheme.

Prime Minister Narendra Modi launched another flagship social security scheme the Pradhan Mantri Suraksha Bima Yojana (PMSBY) which is an accidental death and disability insurance scheme.

This is for the people who are below the poverty line and insurance is an unaffordable service for them. PMSBY aims to reach such people with its benefited insurance schemes after the successful performances of the Jan Dhan Yojana. The Indian population living the rural areas are the targeted people as most of them is not covered under any kind of social security schemes. A large section of this population do not have access to the banking system and most are still unaware of various governmental schemes that are launched from time to time.

To solve the serious anomaly in the lives of ordinary and the poor section of people, the Prime Minister of India launched the PMSBY scheme in Kolkata on the 9th of May 2015 along with two other insurance and pension-related policies. The seriousness of the government to reach the rate of success with the launch of these schemes is so much so that the entire cabinet has waved out to various states and major towns to launch the scheme simultaneously and ensure its successful implementation.

How can the Aam Janta benefit from this scheme compared to other schemes?

· By joining the PMSBY scheme and by paying a nominal premium of INR. 12 per person per annum,

· He or she will get an insurance cover for a sum of 2,00,000 (two lakhs) in case of accidental death or permanent full disability

· Or a lump sum of 1,00,000 (one lakh) in the case of partial but permanent disability

· The scheme will be valid for a year and it can be renewed every year

· All the payments will be directly credited to the beneficiary’s account with no scope for leakages

· The lack of benefits that were being excluded from the large sections allowing for leak of these type of schemes have now been included within the scheme

· The accounts can be easily accessed through the Aadhaar based banking system

· The premium due will be auto debited from the account holder before the 1st of June of each year

· The scheme can be availed at an easy payment of INR. 12 per annum

Who is eligible under the PMSBY?

· Any person between the age of 18 and 70 years with a savings bank account and Aadhaar Card can join the scheme.

· A person would need to fill out a simple form mentioning the name of the nominee and linking the Aadhaar Card to the bank account. The person will need to submit this form each year before the 1st of June to continue the scheme.

Who will implement the PMSBY?

All the government- sponsored general insurance companies will offer the scheme, while other insurance companies have the option to join the program by signing up with their respective banks.

The Suraksha Bima Yojana Features

· The scheme would be renewed every year with a single year cover at a time

· These companies should be willing to offer a scheme similar to the one mentioned under PMSBY and should have an adequate approval and tie-up for this purpose

· The banks would have a free hand in engaging any insurance company that intends to offer the scheme

Tax benefits on joining the scheme

The entire procedure paid for by the subscribers will be tax-free under the section 80C. All proceeds received up to INR. 1, 00,000/- (one lakh) will be exempted from the tax under the Section 10 (10D). For all the amounts that exceed INR. 1, 00,000/- a TDS at the rate of 2% of the total proceeds will apply if Forms 15H or 15G is not submitted to the insuring agency.

The Scope of coverage of the Suraksha Bima Yojana

· If the individual has a multiple savings account, he/she would be eligible to get just one insurance scheme attached to just one saving account

· The primary Know Your Customer (KYC) document required for getting registered under the scheme would be Aadhaar card

· The premium for the scheme would be auto-debited from the saving account of the policy holder

· For the starting year I.E year 2015, those interested in enrolling for the scheme can do so until the 30th of November 2015

· If a policyholder exits the scheme during any year, he/she, if wishes to rejoin it, may do so in succeeding years with the same terms and conditions.

Termination of the scheme

In the case of any of the following reasons the accidental cover of the policyholder would be immediately terminated and no further benefits would be paid:

· If the policyholder attains the age of 70 years

· If the policyholder closes his/her savings account or is unable to continue with the premium paying process or minimum balance in the savings account

· If the policyholder has opted for more than one policy under the scheme, the other policy excepts the oldest would be cancelled and terminated

· If the premium is not being paid due to a lack of funds in the savings account, the policy would be terminated till a period when the policyholder pays the premium

· This a scheme that is focused on bringing the uninsured into the mainstream insurance services. The scheme is much in the line with the prestigious Pradhan Mantri Jan Dhan Yojana. If the scheme is successful, those living below the poverty line in far-flung areas would have a sigh of relief in case of event of accidents in their life

Claim settlement process for the Suraksha Bima Yojana

1. You will need to fill in the claim form and submit it along with a death certificate, along with the original document of the FIR or PMR, Discharge certificate and Insurance certificate at the bank where you are supposed to get the Suraksha Bima Yojana in the savings account.

2. Then the bank branch shall send all documents to the nearest insurance office and there the scrutiny of the documents shall be done. The insurance company shall transfer claim amount in the bank account of that particular nominee and then notify the nearest branch of that bank.

3. This is the process and in case any discrepancy is there, the insurance company shall deal with the designated branch and the individual shall be notified immediately.

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