The Premium for Government Insurance
Pradhan Mantri Jeevan Jyoti Bima Yojana is a one-year life insurance plan that is renewed annually.
The government has increased the premium rates for the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY). The premium for PMJJBY has been raised from Rs. 330 to Rs. 436, while the premium for PMSBY has been raised from Rs. 12 to Rs. 20. The premium rates for the programs have been changed, with both programs now charging Rs 1.25 per day.
PMJJBY is a one-year life insurance scheme for a life cover of Rs. 2 lakh (term insurance), renewable from year to year, offering coverage for death due to any cause, and is available to people between the ages of 18 and 50 (life cover up to the age of 55) who have a savings bank account and consent to join and enable auto-debit. The policy is valid for one year, from June 1 to May 31.
The Pradhan Mantri Suraksha Bima Yojana (PMSBY) is a government program that provides insurance against accidental death and disability. It is a one-year policy that may be renewed by the person each year. For individuals who have previously registered in the PMSBY plan, the premium is debited from the insured’s bank account in one payment using an ‘auto-debit’ function. Typically, your bank account will be charged between May 25 and May 31 of each year.
The premium for Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) would be Rs 436 and Rs 20 respectively, beginning June 1, 2022.
As of 31.3.2022, the number of active subscribers enrolled in PMJJBY and PMSBY was 6.4 crore and 22 crores, respectively. Since the inception of the PMSBY, the implementing insurers have received Rs 1,134 crore in premiums, and claims totaling Rs 2,513 crore have been paid under the PMSBY as of 31.3.2022.
Furthermore, as of 31.3.2022, the implementing insurers had collected Rs. 9,737 crore in premiums and had paid Rs. 14,144 crores in claims under PMJJBY.
Claims under both Schemes have been put into the recipients’ bank accounts using the DBT mechanism.
At the time of the schemes’ debut in 2015, it was determined that the premium amount (Rs. 12 for Pradhan Mantri Suraksha Bima Yojana and Rs. 330 for Pradhan Mantri Jeevan Jyoti Bima Yojana) will be reviewed annually depending on claims experience.
Despite continuous losses to insurers, no premium rate revisions have occurred in the previous 7 years since the schemes’ start.
IRDAI informed that while the claims ratio (percentage of the number of claims paid to the premium earned) for PMJJBY and PMSBY is 145.24 percent and 221.61 percent respectively for the period up to 31st March 2022, the combined ratio (sum of claims ratio and expense ratios) for PMJJBY and PMSBY is 163.98 percent and 254.71 percent respectively for the period up to 31st March 2022.
Due to the schemes’ negative claims experience, PMJJBY and PMSBY premium rates have been changed with effect from 1.6.2022.