Understanding PMJJBY: Key Features and Eligibility Criteria

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is an insurance scheme provided by the government targeted to include low-income groups with a minimal amount payable as a premium. The scheme covers Rs. 2 lakhs for the period 1st June to 31st May and is renewable at a nominal premium amount. People aged 18 to 50 years can opt for the scheme with a savings bank account. The maximum maturity age under this scheme is 55 years.  

We have listed down the benefits of the yojana for your perusal:

1. Enrollment process

LIC (Life Insurance Corporation of India) and other private life insurance companies in India have outlined an easy and hassle-free enrolment process for all the insured individuals. Banks tied up with insurance companies also provide enrolment access. However, individuals can only opt for the scheme through one bank account despite having multiple bank accounts.

2. Death benefit

The PMJJBY is a term policy that provides a death benefit of INR 2 lakhs on the death of the policyholder to the nominee outlined in the policy. There is no survival or maturity benefit provided to the policyholder. However, it is important to note that death benefits will be available only if the death has happened after 45 days of opting for the policy, excluding the cause of death being an accident.

3. Tax benefit

The premium paid towards the policy is deductible under section 80C with a limit of Rs 1.5Lakh. Further, if the policyholder has submitted the form 15G/ 15H, the life insurance policy proceeds exceeding INR 1 lakh will not be taxable. The proceeds will be taxable at 2% if the forms are not submitted.

4. Claim process

The government provides a very streamlined and hassle-free claim settlement process. The claim form must be submitted to the bank or post office branch linked to the policy within 30 days of the death for timely settlement. The claims are usually processed within 30 days.

5. Automated system

The policy provides for auto-debit of the premium from the savings bank account of the policyholders. The premium is auto-debited during the renewal process of the policy during the period from 25th May to 31st May. On submission of a cancellation application, the auto-debit will be cancelled. However, it is essential to submit that cancellation request before the end of the year otherwise, the renewal premiums will continue to be deducted.

6. Consistent premium

The premium is a very nominal amount and stays consistent throughout the tenure of the policy and at all stages. This feature benefits the low-income PMJJBY policyholders, who can continue contributing without additional financial planning.

Key benefits of PMJJBY

With the unpredictability of life, PMJJBY benefits these low-income groups and helps secure their financial future at a nominal premium amount. The government plan offers financial security in the face of adversity at a minimal cost and hassle-free experience

Leave a Comment