PM Jan Suraksha: Term insurance, accident insurance rates unchanged to benefit customers

The finance ministry is said to have kept the annual premium for policies under Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) unchanged for FY22, a move that will benefit customers.

The annual premium of Rs 330 for a life insurance policy under PMJJBY and Rs 12 for a disability and accidental death policy under PMSBY will continue this year. The annual policies can be renewed by the end of June.

While insurers had sought an increase in premiums of up to 20 percent, it was decided not to go ahead with the hike considering income losses and pay cuts due to the pandemic, people familiar with the matter said.

"Any hike would have directly impacted customers and this was not considered appropriate during COVID-19," an official said.

The government's term insurance and accident insurance schemes are the cheapest products in the Indian market. Regular term plans offering the same cover of Rs 2 lakh can cost Rs 900-1,000 per year, while accident insurance covers can cost Rs 600-700.

Immediately after the schemes were introduced in May 2015, banks focussed on enrolling policyholders aggressively and were able to bring 120 million customers on board in the first five months.