Government Sponsored Jan Suraksha Schemes: Trio Pack for Your Financial Security

In order to provide financial security to all citizens, especially the economically vulnerable section of our society, the Indian Government has introduced three pivotal social security schemes, commonly referred to as the ‘Jan Suraksha Schemes’ together. The trio includes the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Atal Pension Yojana (APY). These schemes aim to offer life insurance, accidental insurance, and pension benefits respectively to ensure financial security for subscribers and their families. Now, let’s understand each of these schemes:

PMJJBY: Pradhan Mantri Jeevan Jyoti Bima Yojana

1. PMJJBY is a life insurance scheme which provides cover for death due to any reason.
2. Coverage Duration: The scheme offers a one-year coverage from June 1^st to May 31^st, which can be renewed annually.
3. Sum Assured: Offers a life cover of ₹2 lakh in case of death due to any reason. The cover under PMJJBY is for death only and hence benefit will accrue only to nominee. There is no maturity benefit or surrender value.

4. Premium: The premium payable is Rs. 436/- per annum per subscriber. In case of subscription of policy in the middle of the policy year (1st June to 31st May), subscriber has to pay the premium on a pro-rata basis (i.e. Jun-Aug: Rs. 436/-, Sep-Nov: Rs. 342/-, Dec-Feb: Rs. 228/-, Mar-May: Rs. 114/-). However, the renewal premium remains Rs. 436/- per annum. The premium will be auto-debited from the insured’s bank account.

1. Eligibility: All Individual (single or joint) saving bank account holders in the age group of 18 to 50 years, can join the scheme, however, through one bank/post office account only (Renewal permitted up to 55 Yrs). Institutional account holders are not eligible to subscribe to the scheme.

Benefits:

• Comprehensive Coverage: Ensures financial stability for the family of the insured in the unfortunate event of the policyholder’s untimely death.
• Accessibility: With its low premium and easy enrolment process, it is accessible to a large segment of the population.
• Peace of Mind: Provides a sense of security and peace of mind to policyholders knowing their loved ones are financially protected.

PMSBY: Pradhan Mantri Suraksha Bima Yojana

1. PMSBY is an accidental insurance scheme which provides cover for death or disability due to accident.
2. Coverage Duration: Similar to PMJJBY, it offers one-year coverage, which can be renewed annually.
3. Sum Assured: Provides a cover of ₹2 lakh for accidental death and full disability, and ₹1 lakh for partial disability.
4. Premium: Premium payable is Rs.20/- per annum per subscriber and the premium is auto-debited from the account holder’s bank account.
5. Eligibility: All individual (single or joint) saving bank account holders in the age group 18 to 70 years, other than institutional account holders are eligible. However, one can join the scheme through one bank/post office account only.

Benefits:

• Financial Protection: Offers significant financial support to individuals and families affected by accidents, ensuring support in times of crisis.
• Affordable Premium: With a nominal premium, it ensures that even individuals from lower-income groups can afford it.
• Easy Enrolment: Simple procedure for enrolment and renewal through auto-debit from the bank account.

APY: Atal Pension Yojana

Launched in 2015, the APY scheme focussed on the unorganized sector, aims to provide a regular pension to individuals, ensuring financial independence during old age.

1. Fixed Minimum Pension: Under APY, subscribers receive a fixed guaranteed minimum pension of Rs. 1000, Rs. 2000, Rs. 3000, Rs. 4000, or Rs. 5000 per month upon reaching 60 years of age, depending on their contributions.

The government guarantees a minimum pension; if investment returns on the accumulated corpus, based on contributions, are insufficient to meet this guaranteed minimum, the Central Government will cover the shortfall. Conversely, higher returns will result in correspondingly higher pensions for subscribers. Government invests subscribers’ contributions as per investment guidelines prescribed by PFRDA

2. Pension to Spouse:

• In case of the subscriber’s death, the spouse is entitled to receive the same pension amount as that of the subscriber’s until the death of the spouse. If both the subscriber and the spouse pass away, the nominee of the subscriber is entitled to receive the pension wealth accumulated until the subscriber’s age of 60 years.
• If the subscriber dies before reaching 60 years of age, the spouse has the option to continue contributing to the APY account until the subscriber would have attained the age of 60 years. The spouse will then receive the same pension amount as the subscriber until the death of the spouse.

3. Eligibility: Available to all citizens of India aged 18 to 40 years, with a savings bank account. The minimum contribution period should be 20 years. From 1st October, 2022, any citizen who is or has been an income-tax payer, is not eligible to join APY.

4. Contribution: The subscriber’s contributions to APY are facilitated through ‘auto-debit’ of the prescribed amount from their savings bank account. The subscribers are required to contribute the prescribed contribution amount from the age of joining APY till the age of 60 years.

• Contribution Frequency: Contributions can be made monthly, quarterly, or half-yearly basis.
• Contribution Variability: Contribution levels vary based on the age of joining, with lower contributions for early joiners and higher contributions for later joiners. It also depends on the pension amount chosen, ranging from ₹1,000 to ₹5,000 per month.
• Delayed Contribution: The subscribers should keep the required balance in their savings bank accounts on the stipulated due dates to avoid any overdue interest for the delayed contribution. Banks are required to collect Rs. 1 per month for contribution of every Rs. 100, or part thereof, for each delayed monthly contribution. The overdue interest amount collected will remain as part of the pension corpus of the subscriber.

5. Discontinuation from the scheme: Yes, voluntary exit under APY before 60 years of age is permitted. The subscriber shall only be refunded the contributions made by him along with accrued income earned on his contributions (after deducting the account maintenance charges). In the case of those subscribers who had joined the scheme before 31st March 2016 and had received Government Co-Contribution, they shall not receive the Government co-contribution and the accrued income earned on the same, if opted for Voluntary exit before 60 years. However, to avail of the triple guaranteed benefits of the Govt. of India, the subscribers are urged to continue making contributions into the scheme till 60 years of age.

APY is instrumental in ensuring a stable and secure post-retirement life for individuals, particularly those in the unorganized sector.

Benefits:

• Retirement Security: Ensures a steady income during retirement, reducing dependency on others.
• Encourages Savings: Promotes the habit of saving for retirement among individuals in the unorganized sector.

How to Enrol in These Schemes

Enrolment in these social security schemes is straightforward and can be done through bank branches and the Business Correspondent (BC) channel. Eligible customers can sign up based on the guidelines prescribed by the Government of India and the Department of Financial Services.

Self-Subscribing Journey for PMJJBY & PMSBY

To make the process even more convenient and cost-effective, a reduction in premiums is permitted for customers who enrol through electronic modes such as Internet Banking, Mobile Banking, and Web Link-based enrolment. Customers can also directly enrol in PMJJBY and PMSBY through the Jan Suraksha Portal as part of the ‘Self Subscribing Journey’.

Claim Procedure

In the event of a claim under PMJJBY and PMSBY, the nominee or claimant can submit their claims through bank branches, in the respective portals online. The respective insurance companies settle claims directly to the customers.

Conclusion

By subscribing to these government-sponsored schemes, individuals can secure their future and protect their families against unforeseen financial hardships. These micro-insurance and pension schemes are pivotal in building a financially inclusive and secure society. They not only provide essential financial protection but also foster a culture of savings and insurance among the masses.

As a public sector bank, we encourage our customers to take full advantage of these schemes, securing their future and contributing to greater financial inclusivity. Join us in this journey towards financial empowerment and a safer tomorrow. For more information and to enrol, visit your nearest bank branch or explore available digital options today.

Indian Bank. “Your Own Bank, Always with You”

Disclaimer: https://indianbank.in/departments/disclaimer/