The Hindu Business Line : LIC micro-insurance scheme for the poor

LIC has entered into an MoU with the Confederation of NGOs in Rural India which would implement the scheme with its network of more than 3,000 NGOs/SHGs .

New Delhi , Sept. 26

A simple savings-related life insurance plan for the impoverished and the poor in the country is on the cards.

It is to be jointly managed by the Life Insurance Corporation of India (LIC) and NGOs operating in the rural areas, which would be the primary facilitator.

NGO sources told Business Line that the LIC will unveil the micro-insurance scheme on September 28.

The President, Mr A.P.J. Abdul Kalam, will launch the scheme in the presence of the Union Finance Minister, Mr P. Chidambaram, and the Minister of State for Finance, Mr S.S. Palanimanickam.

LIC has entered into an MoU with the Confederation of NGOs in Rural India (CNRI), which would implement the scheme with its network of more than 3,000 NGOs/SHGs across 30 State Chapters and 400 districts.

CNRI functions under the Chairmanship of Dr Mohan Dharia, former Central Minister and Deputy Chairman, Planning Commission.

The scheme, named Jeevan Madhur, is a modest savings-linked life insurance plan where one might disburse premiums regularly at weekly, fortnightly, monthly, quarterly, half-yearly or yearly intervals over the term of the policy.

The minimum instalment premium for different modes would be Rs 25 for weekly, Rs 50 for fortnightly, Rs 100 for monthly and Rs 250 for quarterly/half-yearly/yearly.

The premium should be subject to the minimum and maximum sum assured of Rs 5,000 and Rs 30,000 respectively payable on death or maturity.

The sources said that member-NGOs of CNRI keen on popularising the scheme would have to undergo three-day or 25-hour training programme organised by the LIC in association with CNRI.

The certificates, on satisfactory completion of the training, would be issued by the LIC.

In order to preclude any hassles to prospective policyholders, requirements of proof of age and health status have been greatly simplified under the scheme, mainly with a view to include a large number of people from the disadvantaged sections, the sources said.

Subject to production of satisfactory evidence of continued insurability, a lapsed policy may be revived by paying arrears of premium coupled with interest within a span of five years but before maturity from the due date of first unpaid premium. The rate of interest applicable in such cases would be as fixed by the LIC from time to time.

When contacted, Mr L.V. Saptharishi, co-Chairman of CNRI, said that 10 NGOs have been identified to implement the scheme in Delhi; the personnel have been given the requisite training.

After Delhi, it is proposed to launch the scheme in Lucknow, Kolkata, Guwahati, Bhubaneshwar, Chennai, Hyderabad, Thiruvananthapuram, Indore and Pune. The scheme would gradually be extended to the rest of the country.

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