Government increases premium for flagship insurance schemes
New Delhi, May 31
Buffeted by too many claims, the government today raised the premium for its flagship insurance schemes — Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) — in order to make them economically viable.
From June 1, the premium rate of PMJJBY will now be Rs 436 instead of Rs 330 and of Rs 20 for PMSBY as against the present Rs 12.
No revision of premium rates was made in the last seven years since the inception of the schemes in spite of recurring losses to the insurers, said a Finance Ministry release.
Under PMSBY, claims of Rs 2,513 crore have been paid as against collection of Rs 1,134 crore. Under PMJJBY, Rs 14,144 crore was paid, whereas Rs 9,737 crore was collected. Claims under both schemes were deposited into beneficiaries’ bank accounts through the direct benefit transfer (DBT) route.
The government claimed that it had closely monitored the transmission of benefits through these schemes during the pandemic and several measures were taken to expedite claims as well as to reach out to the people who died during Covid.
“This would also encourage other private insurers to come on board for implementing the schemes, thereby increasing the saturation of the schemes among the eligible target population, especially those who are underserved or unserved population of India,” said the statement.
The premiums were raised after the IRDAI informed the government about the adverse numbers. The number of active subscribers enrolled under PMJJBY and PMSBY as on March 31 are 6.4 crore and 22 crore, respectively. The target over the next five years is to increase the coverage of PMJJBY from 6.4 crore to 15 crore and from 22 crore to 37 crore for PMSBY.
- The premium rate of PMJJBY will now be Rs 436 instead of Rs 330
- Rs 20 for PMSBY as against the present Rs 12
- Rs 2,513 cr claims paid under PMSBY as against collection of Rs 1,134 cr
- Rs 14,144 cr paid under PMJJBY, whereas Rs 9,737 crore was collected
