PMJJBY and PMSBY - Similarities, Differences and Benefits

India is a vast country with diverse demography. Even as the country is fast progressing, to date, a considerable portion of the population remains under the poverty line. However, the government of India has initiated several schemes for the up-liftment of the poor and provided them basic facilities such as access to quality healthcare and insurance protection.The PMSBY ( Pradhan Mantri Suraksha Bima Yojana ) and PMJJBY ( Pradhan Mantri Jeevan Jyoti Bima Yojana ) are two such popular initiatives. These government-backed schemes aim to provide healthcare and life insurance protection to people from lower-income groups.Just like any other insurance policy, both these insurance policies provide financial protection to the policyholder’s family members in the event of their untimely and unfortunate demise. And since both PMSBY and PMJJBY are insurance policies issued by the government of India, they have a very affordable premium.In this write-up, we will discuss the similarities and differences between these insurance policies. But, first, let us get to know about the basic features of these policies.

The PMSBY is an accidental insurance policy offered by the government of India. This policy provides coverage against accidental death and disability. In case the policyholder has a disability or passes away due to an accident, the insured’s family members receive financial compensation.You can purchase this policy from any public sector insurance company in India. However, to buy this policy, you must meet specific eligibility requirements, which are

• You must be aged between 18 and 70 years at the time of buying the policy.
• You must hold a savings bank account at an accredited bank. This is important because the government will pay the insurance benefits to your bank account in the event of a casualty.

The government of India launched the PMJJY insurance scheme in 2015. It is essentially a life insurance policy that provides financial aid to the policyholder’s family in the event of their sudden demise.You can purchase this policy from LIC or any other life insurance company. The government has also collaborated with specific banks in the country to offer PMJJBY insurance. Anyone aged between 18 and 50 years and has a savings bank account at accredited banks can purchase this policy.If you hold multiple savings bank account with different banks, you must register for PMJJBY under a single savings account.Now that you are aware of what these plans are and their basic features, let us look at the similarities between these insurance plans.

• One of the most prominent and important similarities between PMSBY and PMJJBY is that both these insurance plans are backed by the government of India. These are central government schemes.
• All Indian citizens, irrespective of the income group they belong to, can purchase these policies.
• You can purchase both Pradhan Mantri Suraksha Bima Yojana and Pradhan Mantri Jeevan Jyoti Yojana from any government or private bank of your choice. If you have an existing relationship with any accredited bank, buying the policy would be much easier as the bank may already have your details.
• The maximum sum assured you could avail under these insurance plans is Rs. 2 lakhs. While this may seem a small amount, it can give you an additional financial cushion to your family along with your other insurance policy that you may have. Also, since these policies are specifically designed to benefit the poor, it is a sizeable amount that can help their family meet their regular expenses.
• It is mandatory to hold a savings bank account to purchase these policies.
• The premium amount you pay for these policies is deducted from the associated savings account every year through the auto-debit facility.
• Both PMSBY and PMJJBY have a policy duration of one year. These schemes begin from 1st June, and it ends on the 31st May of the subsequent year.
• The minimum entry age for purchasing these policies is 18 years.
• Once you attain the maximum age as per the scheme directives, the policy will automatically terminate.
• You can purchase only one policy under your name.
• The premium you pay for both these policies is eligible for tax benefits.
• If you are not able to pay the premium for any reason, the policy does not lapse.
• The policies may terminate if you don’t maintain sufficient balance in the associated savings bank account.
• If you or your family members (for PMJJBY) don’t raise a claim, you don’t get any refund.
• In the event of your unfortunate demise, the appointed beneficiary will receive the policy benefits, i.e., the sum insured amount.

While there are many similarities between PMSBY and PMJJBY, there are many differences too.

Premium

The annual premium for PMSBY is Rs. 12 per person. Whereas the yearly premium for PMJJBY is much higher; it is Rs. 33 per person.

Insurance type

The PMSBY is an accidental insurance policy. In contrast, the PMJJBY is a life insurance plan.

Coverage offered

The PMSBY offers coverage against accidental death and disability to the policyholder. On the other hand, the PMJJBY provides protection against death. It provides financial aid to the family members in the event of the insured’s demise.

Benefits offered

The Pradhan Mantri Suraksha Bima Yojana offers the following benefits:

• The policy beneficiary gets Rs. 2 lakhs as a death benefit in the event of your demise due to an accident.
• The policy beneficiary gets Rs. 2 lakhs if you have a permanent total disability due to an accident. The family can use this amount for treatment.
• The policy beneficiary gets Rs. 1 lakh if you have a permanent partial disability due to an accident.

The Pradhan Mantri Jeevan Jyoti offers Rs. 2 Lakhs to the beneficiary as a death benefit in the event of your demise.

Buying a government insurance policy is a great way to give your loved ones the financial protection they need if something happens to you, especially if you are from a low-income group. These insurance policies are affordable and give you a financial cushion against uncertainties.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.