
Insurance coverage under PMJJBY and PMSBY may be doubled in the upcoming budget

Summary
- The initiative aims to strengthen financial security, especially for individuals from economically weaker sections, while advancing the vision of 'Insurance for All by 2047.
New Delhi: The Central government may more than double the insurance coverage under its schemes, the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY), in the upcoming budget, two people aware of the matter told Mint.
The initiative aims to strengthen financial security, especially for individuals from economically weaker sections, while advancing the vision of 'Insurance for All by 2047,' ensuring comprehensive insurance access for every individual and business in India, the people mentioned above added.
Proposals are under consideration to increase the life cover under PMJJBY, one of the government’s largest life insurance programmes, from the current limit of ₹2 lakh to ₹5 lakh, the first person mentioned above said requesting anonymity.
"The proposed changes aim to address the insurance protection gap by offering higher coverage, ensuring that insured individuals or their dependents have adequate financial support to meet their obligations. Increasing the coverage to ₹5 lakh under these schemes is expected to significantly reduce this gap," this person said.
"An announcement in this regard could be made in the annual budget (to be presented on 1 February)," the person added.
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Last month, the finance ministry said the PMJJBY scheme has provided ₹2 lakh life insurance cover to over 210 million beneficiaries across India.
As of 20 October, 2024, enrolments had reached 216 million, with 860,575 claims settled, amounting to ₹17,211.50 crore.
Key features
While, the PMSBY is an accident insurance scheme that provides financial protection against accidental death and disability and offers one-year coverage, renewable annually, the PMJJBY is a renewable one-year life insurance scheme, covering death from any cause.
There have been discussions in the government to enhance coverage under PMJJBY and PMSBY schemes, and some more tweaks could be expected in the upcoming budget.
"Individuals may be given the option to opt for higher coverage with an increased premium or retain the existing ₹2 lakh cover, which costs ₹20 annually for PMSBY and ₹436 annually for PMJJBY," the first person mentioned above said.
"The premium payable under the revised version of the schemes is currently being worked out though it is unlikely to see a sharp hike as the plan is to keep premium low to enable higher coverage under the insurance plans," added the person mentioned.
A spokesperson of the ministry of finance, and the secretary of the Department of Financial Services, didn't respond to an emailed query.
"The government seeks to broaden insurance coverage while ensuring premiums stay affordable, making the schemes accessible to a larger segment of the population despite the increased benefits," the second person mentioned above said.
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"The goal is to strike a balance between enhanced coverage and cost-effectiveness, ensuring that the benefits reach those who need them most, without placing a financial burden on policyholders," the person added.
Since announcing its ‘Insurance for All’ by 2047 vision in November 2022, the Insurance Regulatory and Development Authority of India (Irdai) has worked to eliminate regulatory, capital, and social barriers, driving greater consumer adoption of life and health insurance.
The ‘Insurance for All’ by 2047 vision aims to provide every citizen with life, health, and property coverage while offering businesses tailored insurance solutions.