Social Security Schemes

In News

• Recently, Pradhan Mantri Suraksha Bima Yojana (PMJJBY), Pradhan Mantri Jeevan Jyoti Bima Yojana (PMSBY) and Atal Pension Yojana (APY) have completed 7 years of providing social security net.

Key Points

• Launch: PMJJBY, PMSBY and APY were launched in 2015.
• Objectives: 
  • These three social security schemes are dedicated to the welfare of the citizens, recognising the need for securing human life from unforeseen risks/losses and financial uncertainties. 
  • To ensure that the people from the unorganised section of the country are financially secure.
• Insurance cover: 
  • While the PMJJBY and PMSBY provide access to low-cost life/accidental insurance cover to the people, the APY provides an opportunity for saving in the present for getting a regular pension in old age.
• Part of National Mission for Financial Inclusion: 
  • One of the main objectives of the mission was to expand the coverage of insurance and pension in order to provide the poor and marginalised sections of the society the much-needed financial security through affordable products.
• Affordable & Increased Availability:
  • Today, even the poorest of the poor can have a life insurance cover for Rs 2 lakh at less than 1 rupee a day under PMJJBY and accident insurance of Rs 2 lakh at less than 1 rupee a month under PMSBY. 

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

• Scheme: PMJJBY is a one-year life insurance scheme renewable from year to year offering coverage for death due to any reason.
• Eligibility: Individuals in the age group of 18-50 years having a savings bank or a post office account are entitled to enrol under the scheme. People who join the scheme before completing 50 years of age can continue to have the risk of life covered up to the age of 55 years upon payment of the premium.
• Benefits: Life cover of Rs. 2 Lakh in case of death due to any reason against a premium of Rs. 330/- per annum.
• Enrolment: 
  • Enrolments under the scheme can be done by visiting the branch/ BC point or website of the bank of the account holder or at the post office in case of a post office savings bank account.  
  • The premium under the scheme is auto-debited every year from the subscriber’s bank account based on a one-time mandate from the account holder. 
• Achievements: Under PMJJBY, a cumulative number of 12.76 crore persons have enrolled since inception for life cover and families of 5,76,121 persons have received claims for Rs. 11,522 crores under the scheme. 

Pradhan Mantri Suraksha Bima Yojana (PMSBY)

• Scheme: PMSBY is a one-year accidental insurance scheme renewable from year to year offering coverage for death or disability due to accident.
• Eligibility: Individuals in the age group of 18-70 years having a savings bank or a post office account are entitled to enrol under the scheme.
• Benefits: Accidental death cum disability cover of Rs.2 lakh (Rs.1 lakh in case of partial disability) for death or disability due to an accident.
• Enrolment: 
  • Enrolment under the scheme can be done by visiting the branch/ BC point or website of the bank of the account holder or at the post office in case of a post office savings bank account.  
  • The premium under the scheme is auto-debited every year from the subscriber’s bank account based on a one-time mandate from the account holder. 
• Achievements: 28.37 crore people have enrolled for accident cover since the launch of PMSBY and a number of Rs 1,930 crore has been paid towards 97,227 claims. 

Atal Pension Yojana (APY)

• It is an initiative of the Government to provide financial security and cover future exigencies for the people in the unorganised sector. 
• APY is administered by Pension Fund Regulatory and Development Authority (PFRDA) under the overall administrative and institutional architecture of the National Pension System (NPS).
• Eligibility: APY is open to all bank account holders in the age group of 18 to 40 years and the contributions differ, based on the pension amount chosen.
• Benefits: Subscribers would receive the guaranteed minimum monthly pension of Rs. 1000 or Rs. 2000 or Rs. 3000 or Rs. 4000 or Rs. 5000 at the age of 60 years, based on the contributions made by the subscriber after joining the scheme.
• Disbursement of the Scheme Benefits: 
  • The monthly pension is available to the subscriber, and after him to his spouse and after their death, the pension corpus, as accumulated at age 60 of the subscriber, would be returned to the nominee of the subscriber.
  • In case of premature death of subscriber (death before 60 years of age), spouse of the subscriber can continue contributing to APY account of the subscriber, for the remaining vesting period, till the original subscriber would have attained the age of 60 years.
• Payment frequency: Subscribers can make contributions to APY on a monthly/quarterly/half-yearly basis.
• Withdrawal from the Scheme: Subscribers can voluntarily exit from APY subject to certain conditions, on deduction of Government co-contribution and return/interest thereon.
• Achievements: More than 4 crore people have already subscribed to the APY scheme.

Significance of Social Security Schemes

• The schemes have proved extremely useful for low-income households during pandemics as in FY21, almost 50% of claims paid out were due to COVID-19 deaths. 
• Increased insurance penetration among the unorganised sector has led to safe and secure lives for everyone.
• The availability of such services in rural areas has led to better standards of living.
• The mission of financial inclusion was farsighted but has led to tremendous inclusions of people into official systems of banking.

Conclusion

• The number of people who have enrolled and benefitted from the above schemes over the last seven years is a testimony to their success. 
• These low-cost insurance schemes and the guaranteed pension scheme are ensuring that financial security is now reaching the last person of the society

Source: PIB