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Alert! Premium for government insurance schemes revised from June 1, 2022 – Check new rates

Pradhan Mantri Jeevan Jyoti Bima Yojana is a one-year life insurance scheme, renewable on annual basis.

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Pradhan Mantri Suraksha Bima Yojana is a scheme offering insurance against accidental death and disability.

Premium rates of Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) have been revised upwards by the government. For PMJJBY, the premium has been increased from Rs. 330 to Rs. 436 while for PMSBY, the increase in premium is from Rs. 12 to Rs. 20. The premium rates of the schemes have been revised by making it Rs 1.25 per day premium for both schemes.

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 reason and is available to people in the age group of 18 to 50 years ( life cover up to age 55) having a savings bank account who give their consent to join and enable auto-debit. The cover is for a one-year period, starting June 1 to May 31.

Pradhan Mantri Suraksha Bima Yojana (PMSBY) is a scheme offering insurance against accidental death and disability. It is a one-year cover and may be renewed each year by the individual. For those who had already enrolled for the PMSBY scheme, the premium is deducted from the bank account of the insured through an ‘auto-debit’ facility in one installment. Your bank account will typically get debited between May 25 and May 31 of each year.

From June 1, 2022, the premium for Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) will stand at Rs 436 and Rs 20 respectively.

The number of active subscribers enrolled under PMJJBY and PMSBY as on 31.3.2022 are 6.4 crore and 22 crore, respectively. Since the launch of the PMSBY, an amount of Rs 1,134 crore has been collected by the implementing insurers towards premium and claims of Rs. 2,513 crore have been paid under PMSBY as on 31.3.2022.

Further, an amount of Rs. 9,737 crore has been collected by the implementing insurers towards premium and claims of Rs. 14,144 crore have been paid under PMJJBY as on 31.3.2022.

Claims under both the Schemes have been deposited into the bank account of the beneficiaries through the DBT route.

At the time of launch of the schemes in 2015 it was decided for an annual review of the premium amount (Rs. 12 for Pradhan Mantri Suraksha Bima Yojana and Rs. 330 for Pradhan Mantri Jeevan Jyoti Bima Yojana) based on the claims experience.

However, no revision of premium rates was made in the last 7 years since inception of the schemes in spite of recurring losses to the insurers.

Upon examination of the claims experience of the schemes, IRDAI informed that while the claims ratio (percentage of amount of claims paid to premium earned) pertaining to PMJJBY and PMSBY, for the period up to 31st March, 2022, is 145.24 % and 221.61% respectively the combined ratio (sum of claims ratio and expense ratios) pertaining to PMJJBY and PMSBY, for the period up to 31st March, 2022, is 163.98 % and 254.71% respectively.

In view of the adverse claims experience of the schemes, PMJJBY and PMSBY and in order to make them viable for the implementing insurers the premium rates of PMJJBY and PMSBY have been revised w.e.f. 1.6.2022.

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