Narendra Modi to launch insurance, pension schemes on May 9

New Delhi: Prime Minister Narendra Modi will launch the flagship social security schemes, including Rs 2 lakh accident cover at a premium of just Re 1 per month, in Kolkata on May 9.

These schemes, to be launched by Narendra Modi, are aimed at providing affordable universal access to essential social security protection in a convenient manner linked to auto-debit facility from the bank account of a subscriber, a Finance Ministry statement said.

These schemes were announced in the Budget by Finance Minister Arun Jaitley on February 28. The two insurance schemes, Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), would provide insurance cover in the unfortunate event of death by any cause, death or disability due to an accident, whereas the pension scheme, Atal Pension Yojana (APY), would address old age income security needs, it said.

The convenient delivery mechanism of the schemes is expected to address the situation of very low coverage of life or accident insurance and old age income security products in the country.

PMSBY will offer a renewable one year accidental death cum disability cover of Rs 2 lakh for partial permanent disability to all savings bank account holders in the age group of 18-70 years for a premium of Rs 12 per annum per subscriber, it said.

The scheme would be administered through Public Sector General Insurance Companies or other General Insurance companies willing to offer the product on similar terms on the choice of the bank concerned, it added.

PMJJBY on the other hand will offer a renewable one year life cover of Rs 2 lakh to all savings bank account holders in the age group of 18-50 years, covering death due to any reason, for a premium of Rs 330 per annum per subscriber.

The scheme would be offered or administered through LIC or other Life Insurance companies willing to offer the product on similar terms on the choice of the bank concerned.

The pension scheme named Atal Pension Yojana will focus on the unorganised sector and provide subscribers a fixed minimum pension of Rs 1000, 2000, 3000, 4000 or Rs 5000 per month starting at the age of 60 years, depending on the contribution option exercised on entering at an age between 18 and 40 years.

Thus, it said, the period of contribution by any subscriber under APY would be 20 years or more. The fixed minimum pension would be guaranteed by the government.

"While the scheme is open to bank account holders in the prescribed age group, the Central Government would also co-contribute 50 per cent of the total contribution or Rs 1000 per annum, whichever is lower, for a period of 5 years for those joining the scheme before December 31, 2015 and are not members of any statutory social security scheme and are not income tax payers," it said.