It is renewal time for the Modi government’s low-cost life and accident insurance schemes, launched last year. 

About 12.50 crore policies subscribed under the schemes will be automatically renewed if the bank accounts have the required balance.

Government data on the gross enrolments reported by banks up to May 5, show that total subscriptions to the Pradhan Mantri Jivan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY), and the low-cost pension scheme Atal Pension Yojana stood at about 13 crore .

PMJJBY offers a renewable one-year life cover of ₹2 lakh to all savings bank account-holders in the age group of 18-50 years, covering death due to any reason, for a premium of ₹330 per annum and being administered by the Life Insurance Corporation of India and some other private insurers.

Both public and private sector banks have started sending alerts to customers informing them of the impending renewal.

“Though the premium amount gets automatically debited from customers’ accounts, we are creating more awareness at the branch level,” a senior executive of State Bank of India told BusinessLine .

Private banks such as ICICI Bank have also started sending messages saying that the premium amount will be deducted on May 31.

PMSBY provides a renewable one-year accidental death-cum-disability cover of ₹2 lakh for partial/permanent disability for those in the age group of 18-70 years for a premium of ₹12 per annum through public sector general insurance policies.

The profile of customers reveals that all sections of society, including urban middle class/professionals and employees, have been patronising the schemes equally along with the poor. The urban-rural ratio of subscribers is at 48:52.

Claims payment

The payment of claims under the schemes has also been noteworthy.

As indicated by a progress report of the Department of Financial Services, 89.57 per cent of total claims reported (24,039) have been paid as on May 3, 2016 under PMJJBY.

The percentage of settled claims is 66 per cent under PMSBY. The rejected claims are 1.51 per cent and 16.40 per cent respectively, under the schemes.

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