351 | Page GOVERNMENT BACKED INSURANCE SCHEMES AS SOCIAL SECURITY MEASURES: AN ANALYSIS (PMJJBY AND PMSBY) Dr.Samir Kumar 1 , Dr.Sandeep Nath Modi 2 1 Sr.Manager, 2 Manager, Syndicate Bank, is Presently on Deputation as Faculty, National Institute of Financial Management, Ministry of Finance, Government of India, Faridabad, Haryana ABSTRACT Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY ) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) are two Government of India backed flagship insurance schemes, which were launched in May 2015 after the historic success of saving account opening (Approx. 25.98 Crore by 14 th December 2016) under PMJDY (Pradhan Mantri Jan Dhan Scheme). The objective of the present study is to analyse the progress made under both schemes as on 14.12.2016, the performances of the participating instituitions , similarities and dissimilarities between both schemes and cost advantage of insurance premium to be paid under both schemes in comparison to other private players . The present study also investigates the performance in terms of coverage under PMJJBY and PMSBY schemes for the saving accounts opened under PMJDY. Three field based case studies ,one under PMJJBY and two under PMSBY, have also been discussed which shows the ease of process of claim settlement in favour of nominee ,assuring the pious concept of social security behind these schemes. This is a noble scheme that aims to bring the uninsured into the mainstream insurance scheme much in line with the prestigious PM Jan Dhan Yojana and is actually a continuation of the latter. The Scheme has so far succeeded for at least those living below poverty line in far flung areas with a sigh of relief in case of event of accidents in their life. PMJJBY and PMSBY have benefitted to the common mass in terms of settlement of claims under Death and Accidental cases. Key Words: Insurance Schemes, Insurance Claims, Public Sector Banks, Private Sector Banks, RRBs. JEL Classification: G22, I13, O18, R20 I. BACK DROP: The Pradhan Mantri Jan Dhan Yojana (PMJDY) sets out to provide a basic Bank account to every family who till now had no account. The bank account comes with a RuPay debit card with a built-in accidental cover of Rs 1 lakh. During the launch of the PMJDY scheme on 28.08.14 in New Delhi, Hon’ble Prime Mi nister announced a life cover of Rs. 30,000/- with the RuPay Card for all those who subscribe to a bank account for the first time during the period 15th August, 2014 to 26th January, 2015. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) are two Government of India backed flagship insurance schemes, which were launched in May 2015 after the historic success of saving account opening (Approx.25.98 Crore by 14th December 2016) under PMJDY (Pradhan Mantri Jan Dhan Scheme). II. OBJECTIVE OF THE STUDY: To find out performance of PSBs, RRBs, Private Banks and Foreign Banks in terms of Number of Accounts opened under PMJDY. To analyse the position of Zero Balance Accounts under PMJDY by PSBs, RRBs, Private Banks and Foreign Banks. To assess the Progress under credit balance in Accounts opened under PMJDY Accounts. To compare Performance of Selected Banks under Jan Dhan Yojana. To identify the number of accounts covered / Enrolments made under PMJJBY and PMSBY Govt. Insurance Schemes by PSBs, RRBs, Private Banks and Foreign Banks.
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351 | P a g e
GOVERNMENT BACKED INSURANCE SCHEMES AS
SOCIAL SECURITY MEASURES: AN ANALYSIS
(PMJJBY AND PMSBY) Dr.Samir Kumar
1, Dr.Sandeep Nath Modi
2
1Sr.Manager,
2Manager, Syndicate Bank, is Presently on Deputation as Faculty,
National Institute of Financial Management, Ministry of Finance,
8. Comparative analysis of Cost of Insurance coverage for Rs. 2, 00,000/- (Two lakh only)
One of the feature of the PMJJBY and PMSBY is the advantage of cost of Insurance. Table-6 shows that an
insurance coverage of Rs 2,00,000/- is possible under PMJJBY and PMSBY with a small premium of Rs 330/-
and Rs 12/- respectively while other players like LIC ,Bajaj Allianz , Birla Sun life are providing the life
insurance coverage of Rs 2,00,000/ with a premium of approx. Rs 6,001/-, Rs 25,000/ and Rs
4,597/respectively per year .
Table - 9: Comparative analysis of Cost of Insurance coverage for Rs 2, 00,000/ (Rupees Two
lakh only)
Institutions Premium
required
Period Cash
Back
Other Remarks
Under PMJJBY and
PMSBY by all
participating
Institutions
Rs 12 for
PMSBY by
UIICO
Rs 330 For
PMJJY by
LIC
One Year
Nil
In case of PMSBY Accidental insurance is
covered upto Rs.1.00 Lac (Total and
irrecoverable loss of sight of one eye or
loss
of use of one hand or foot)
LIC 6,001/- One Year Nil PLAN:0814 New Endowment Plan (Source
: www.licindia.in)
Bajaj Alliance 25,000/- One Year Nil Insurance Coverage is Rs.3.75 Lacs(Bajaj
Allianz Future Gain Source:
www.life.bajajallianz.com)
Birla Sun life 4,597/- One Year Nil Rs. 11 per day (Source :
www.insurance.birlasunlife.com
9. Case Studies based on Field Observation: Case: 1: This is a case of Public Sector Bank in Rural Area of Meerut Region. An account holder aged 48 years
took PMJJBY on 01.10.2015. He got an electric shock from electric poll and died while taking treatment in
Hospital on 05.02.2016. His nominee was his wife. She filed for a claim on 25.02.2016 under PMJJBY and got
a Claim of Rs.Two Lacs from Bank within a month of filing claim.
Case 2: This is a case of a Lady staff named Ms Manisha Rathore aged 30 years working as Temporary Part
Time Sweeper in Rural branch of Surat. She took PMJJBY on 15.07.2015. She met with an accident on road
and was hit on her head leading to death. Her mother who was the nominee of the account holder got a claim of
Rs.Two Lacs only after she filed her claim on 31.07.2015. This money is being utilised in meeting needs of
children of Late Manisha Rathore.
Case 3: This is a case of Private Sector Bank of Meerut city wherein an account holder who got insured under
PMSBY met with a severe accident and his left leg was damaged badly and had to be removed because of
infection. Since he was insured under PMSBY he was able to claim Rs. One Lac from Insurance Company
through Banks. Now he is running a small kirana shop in his native village after paying all expenses incurred
during the treatment.
10. Conclusion and Recommendations:
The launch of PMJDY in 2014 that made a history regarding opening of the no frill accounts is severely
criticised by the expert due the presence of Zero balance as well as increasing Dormancy status of the accounts
in absence of operation but it had definitely paved a way for the launch of PMJJBY and PMSBY. Availability of
a life Insurance coverage of Rs 2,00,000/(two lakh only ) with a small premium amount of Rs 12 and Rs 330
under these scheme is gaining popularity day by day due to cost advantage, easy access to scheme, facility of
auto debit towards premium payment as well ease of Claim Settlement. Following Suggestions are being made
for better Implementation of the Insurance Schemes –
More Number of Branches to be opened in Rural and Semi-urban areas by Private Banks and RRBs.
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Financial Literacy Camps to promote these Schemes should be organised in Rural and Semi-urban
areas.
Public Awareness regarding benefits of both these schemes.
There is a need for increase in the ratio of claim settlement against the claim reported.
Adoption of Villages or areas which are unbanked / not approachable by PSBs/ Private Banks/RRBs.
Annexure
Performance of Selected Banks under Enrolments under PMJJBY and PMSBY for
Year 2016-17 (as on 14-12-2016)
Banks
Accounts
Covered under
PMJJBY
Accounts
Covered under
PMSBY
1.Public Sector Banks
Syndicate Bank
38,349 70,490
SBI 1,73,550 1,50,214 PNB 5,495 12,09,177 BOI 39,238 88,282 Bank of Baroda 1,01,680 4,11,121 Canara Bank 27,958 62,392 Dena Bank 27,498 37,191 Union Bank of India 82,172
59,612
Total 4,95,940 21,76,761
2. Private Sector Banks :
ICICI Bank 0 0
HDFC 19,502
53,501
YES BANK 62
87
AXIS Bank 7,163
6,865
Total 3.Foreign Bank Standard Chartered Bank 0 0 Others 0 0 Total 0 0