A Detailed Look At The Main Features Of PMSBY

In 2015, the Narendra Modi Government introduced several new schemes, most of which were targeted towards people belonging to economically weaker income groups. The idea was to ensure that such people, who could not afford spending huge premiums on different types of pension or insurance schemes, could easily do so, and secure the financial future of their loved ones. The three most popular schemes launched by the government include the pension, life and accidental insurance schemes. Of this, the latter is known as the Pradhan Mantri Suraksha Bima Yojana. Here are the basic features of this policy.

Eligibility Criteria

The scheme is available to both, resident Indian citizens and well as Non Resident Indians. You need to belong to the 18 to 70 years age group to be eligible for the scheme. Also, you need to have an active savings account in a public or private sector bank, participating in the scheme and a government authorised identification proof document to be eligible for the scheme.

Premium Payable

PMSBY insurance policy can be purchased at an extremely low price of ₹12 per annum, including service tax. Of this, the actual insurance premium per person is ₹10, whereas a sum of ₹1 is charged towards expense reimbursement to entities such as agents, micro, BC or corporates and another ₹1 is charged towards the reimbursement of administrative expenses to participating banks. The ₹12 insurance premium amount makes accidental insurance affordable for the economically lower income groups and secures the financial future of the policy holder’s kin in the event of an accident leading to permanent partial or permanent total disability. 

Coverage offered under the policy

One of the most important PMSBY scheme details to highlight is the coverage offered under this scheme. Despite the extremely low premium amount of ₹12 per annum, the insurance pay-out provided to the policy holder is a whopping ₹200,000, in case of permanent total disability. If the policy holder suffers permanent partial disability, the pay-out provided is ₹100,000.

Categorisation of disabilities

Many people are confused about the categorization of permanent partial and permanent total disabilities. Permanent total disability is basically defined as the total and irrecoverable loss of eyesight in both eyes as well as the total and irrecoverable loss of use of both sets of limbs i.e. both hands and/or both legs. Permanent partial disability, on the other hand, is defined as the total and irrecoverable loss of eyesight in either eye and the total and irrecoverable loss of use of one each of either or both, hands and/or legs.

Insurance Pay-out

Although this scheme is open to both, resident Indians, the insurance amount pay-out is done only in INR since the PMSBY policy is an accidental insurance policy launched in and meant for Indians. When an NRI policy holder’s family files an insurance claim, the pay-out will be processed in INR and the amount will be credited in the NRE or NRO account, linked to the bank.

Purchasing the policy

As mentioned above, you can purchase the PMSBY scheme by visiting any of the participating banks in the private and public sector. Prominent banks participating in the scheme include SBI, Bank of Baroda, Bank of India, HDFC Bank, Axis Bank and ICICI Bank. The policy is also provided by public and private sector insurance companies like New India Assurance, United India Insurance, Reliance General Insurance, etc.