In the Union Budget 2015-2016, the Finance Minister Mr. Arun Jaitely proposed to launch three low-investment schemes to benefit the economically weaker segments in our society. The three social security schemes are - Pradhan Mantri Jeevan Jyoti Bhima Scheme, Pradhan Mantri Suraksha Bhima Yojana and Atal Pension Yojana.
Encouraged by the success of Pradhan Mantri Jan Dhan Yojana, Mr. Narendra Modi and Mr. Arun Jaitely proposed to work together towards in creating investment schemes for a large population of India, who were without any insurance of any kind – life and health. They sought at creating universal social security schemes that will benefit the lower strata of the Indian society.
Pradhan Mantri Jeevan Jyoti Bhima Yojana is the second life insurance scheme launched by the Government of India; the first being Pradhan Mantri Suraksha Bhima Yojana. The main intention of launching such schemes is to provide low-cost insurance schemes to the deprived and underprivileged. Let us see the features and benefits of Pradhan Mantri Jeevan Jyoti Bhima Yojana:-
• A premium of Re. 1 per day or Rs. 330/- annually is to be paid.
• The premium amount will be auto-debited from the bank account in a single instalment.
• Maximum sum assured provided by this scheme is Rs. 2 lakh. Proceeds of the policy will be paid to the nominee in case of accident or natural death.
• This insurance policy scheme can be opened by an Indian citizen.
• Minimum age limit for joining this scheme is 18 years.
• Maximum age limit for joining this scheme is 50 years.
• Those who join this scheme before completing 50 years can continue this policy up till 55 years of age upon paying the premiums.
• Aadhar card linked to bank account is mandatory for opening and operating this insurance policy. No other documents are required to subscribe to this policy.
• Application for this investment scheme is available with selected commercial banks or LIC of India.
• At the time of joining this scheme, the subscriber would get two options. Either he can choose the auto-renewal option or opt for renewing the policy each year.
• In the case of renewing annually, policy will need to be renewed each year though risk coverage will be provided up to 55 years.
• Long term options are also available. The subscriber can select the auto renewal option.
• Renewal of this scheme will happen every year in the month of June.
• Premiums are exempted from tax deductions under Section 80 C of Income Tax Act.
Pradhan Mantri Jeevan Jyoti Bhima Yojana is a great insurance scheme for drivers, peons and maids working for you. It is cost effective. Taking up a term plan with sufficient risk coverage is always beneficial in the long run and in the case of any untoward incidents. The only flip in this insurance scheme is the amount of sum assured. The amount of sum assured is just Rs. 2 lakh which is not enough as against the current inflation rate. Besides that, it is a good investment scheme that can be considered.
This scheme will be offered by LIC of India and will commence from 1st June, 2015.