PRADHAN MANTRI SURAKSHA BIMA YOJANA

PRADHAN MANTRI SURAKSHA BIMA YOJANA

Introduction

Prime Minister Suraksha Bima Yojana (PMSBY) is an “Accident Insurance” scheme established by the government of India to provide insurance cover to Indians. This scheme provides death and disability cover of ₹2.00 lakhs due to an accident at an annual premium of just ₹20.

Key Features of PMSBY

• Launch Date: 9 May 2015. The scheme was effective from 01-June-2015 onwards.
• Nature of Scheme: One-year renewable accident insurance cover.
• Premium: ₹20 per annum (auto debited from bank account).
• Coverage: 
  • Accidental death: ₹2 lakh
  • Total disability (loss of both eyes/hands/feet): ₹2 lakh
  • Partial disability (loss of one eye/hand/foot): ₹1 lakh.
  • The scheme’s insurance coverage period is for 1 year from 1^st June to 31^st May.
• Eligibility:
  • Age group: 18–70 years
  • Must have a savings bank account and Aadhaar linkage recommended for enrollment.
  • At any time, you can have only 1 policy under this scheme. But you can join this scheme even have other accident insurance policy.

• No medical checkup required to join the scheme.
• There is no waiting period in this scheme. It means death or disability will be covered from day 1 of joining the scheme.
• NRI can join the scheme.
• Income tax benefits.

Objectives of PMSBY

• To provide affordable insurance cover to Indians, mainly people of unorganized sector and low-income groups.
• To encourage all Indian citizens to plan for their accident insurance cover and reduce financial vulnerability of families during accidental tragedies.

Work Process

• Enrollment: You have to join the scheme in a bank or post office and need to pay yearly premium of ₹20 to get accident insurance cover of ₹2.00 lakhs.
• Renewal: This scheme provides accident insurance cover for 1-year only. Hence you need to renew the policy every year to have insurance cover. The maximum age of renewal is 70-years, after that you cannot renew the policy.
• Coverage: In case of unfortunate death or disability due to an accident during the coverage period, your nominees or account holder (as applicable) will get a lump sum amount of ₹2.00 lakhs.

Income Tax Benefits

• Old tax system- yearly premium is eligible for tax deduction under section 80C of Income tax Act. The death or disability cover of ₹2.00 lakh will also get exemption under section 10D.
• New tax system- yearly premium is not eligible for tax deduction, but death or disability covers of ₹2.00 lakh will get exemption under section 10D.

Achievements & Impact

• Millions of citizens, especially from rural and unorganized sectors, have enrolled.
• The scheme has provided crucial financial relief especially to low-income families in cases of accidental deaths.

Limitations & Challenges

• Low awareness among rural populations.
• Limited coverage (₹2 lakh may not be sufficient in today’s context).
• Dependence on bank accounts excludes those outside formal banking.

MCQs on PMSBY

Q1. Pradhan Mantri Suraksha Bima Yojana (PMSBY) was launched in:

1. 2014
2. 2015
3. 2016
4. 2017
   👉 Answer: b) 2015

Q2. What is the annual premium for PMSBY?

1. ₹12
2. ₹20
3. ₹436
4. ₹330
   👉 Answer: b) ₹20

Q3. PMSBY provides insurance coverage for:

1. Old-age pension
2. Accidental death and disability
3. Natural death only
4. Health treatment expenses
   👉 Answer: b) Accidental death and disability

Q4. Maximum coverage under PMSBY for accidental death is:

1. ₹1 lakh
2. ₹2 lakh
3. ₹5 lakh
4. ₹10 lakh
   👉 Answer: b) ₹2 lakh

Q5. The eligible age group for PMSBY is:

1. 18–50 years
2. 18–60 years
3. 18–70 years
4. 21–65 years
   👉 Answer: c) 18–70 years

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