R. Doraiswamy, CEO and MD, Life Insurance Corporation
Many families remain unaware of Pradhan Mantri Jeevan Jyoti Bima Yojana or that premiums were paid for deceased members, with no physical policy document issued.In the absence of a nominee, families must undergo legal processes to claim benefits.Banks, business correspondents and district authorities must close this awareness gap, especially in rural areas.
Banking and Insurance are the mark of economic stability. Having a bank account instils a sense of confidence particularly in economically weaker sections of society, and insurance fortifies it.
When India launched its financial inclusion mission in earnest, these two instruments became the dual pillars of a programme designed to reach hundreds of millions of citizens who had, until then, existed entirely outside the formal economy.
At the time of the scheme’s launch in 2015, only about 20 percent of India’s population was covered under any kind of insurance. The gap was not a failure of individual choice. It reflected the absence of products that could reach the poor at a price they could afford, through channels they already used.
The Government of India’s response was built in deliberate stages. India’s aspirational financial inclusion journey began with Pradhan Mantri Jan DhanYojana which was launched in 2014 to provide banking services to every citizen, with a particular focus on the rural poor. The bank account was the foundation.
A year later, on 9th May 2015, three schemes were launched together by the Prime Minister to raise the structure of financial security on that foundation. Pradhan Mantri Jeevan Jyoti Bima Yojana provided life cover. Pradhan Mantri Suraksha Bima Yojana provided accident and disability cover.
Atal Pension Yojana addressed the retirement security of workers in the unorganised sector. Together, these three schemes form the Jan Suraksha trinity, each addressing a distinct dimension of the risk that a low-income household faces.
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a one-year term assurance scheme providing a life cover of Rs. 2 lakhs to bank account holders within the age group of 18 to 50 years. The cover is available for death due to any cause, whether natural or accidental, with no exclusions based on pre-existing health conditions.
The account holder submits a Consent cum Declaration form to join. No medical examination is required. No separate KYC documentation is needed, since the subscriber’s identity, age, and account details are already on bank record.
The arithmetic of the scheme is its most striking feature. The annual premium is Rs. 436. That is approximately Rs. 1.20 per day. For this sum, a subscriber’s family receives Rs. 2 lakhs upon his or her death during the policy year. For a daily wage earner whose entire annual income may not reach Rs. 1 lakh, Rs. 2 lakhs represents a significant cushion against destitution. It can cover a child’s school fees for several years, settle a small farm loan, or give a widow the time to find her footing without being pushed immediately into distress.
For those enrolling for the first time during the middle of the policy period, a pro-rata premium structure applies. Enrolment in June, July, or August requires the full annual premium of Rs. 436. Enrolment in September, October, or November requires Rs. 342. Enrolment in December, January, or February requires Rs. 228.
Enrolment in March, April, or May requires Rs. 114. This structure ensures that nobody is penalised for joining late in the year, and the scheme remains accessible to new subscribers throughout the policy period.
One condition deserves the subscriber’s attention. Insurance cover is not available for death due to causes other than accident occurring during the first 30 days from the date of enrolment. This lien period applies to new subscribers and to those re-joining after a break in coverage. The subscriber’s risk cover for accidental death begins from the date of enrolment itself.
The renewal mechanism is designed to remove the one failure that most commonly breaks insurance continuity among low-income subscribers: forgetting to pay. Every year on 1st June, the premium of Rs. 436 is automatically debited from the subscriber’s linked bank account. No action is required from the subscriber, provided the account holds sufficient balance.
The policy continues uninterrupted. Subscribers who maintain this continuity can hold the cover until the age of 55, even though fresh enrolment is not possible beyond the age of 50.
Every bank participating in PMJJBY is required to tie up with one life insurance company. The master policy is held by the bank, and all enrolled account holders are covered under it. The data and the premium remitted to the insurer form the basis of the life insurance coverage.
The claim process flows through the same channel. In the event of the subscriber’s death, the nominee submits the claim form and required documents to the bank where the deceased held the linked savings account. The bank verifies the nominee details, forwards the claim documents to the partner insurance company, and upon approval, the claim amount of Rs. 2 lakhs is directly credited to the nominee’s bank account.
As of now, the scheme has cumulatively enrolled 27.43 crore individuals, settled 8.8 lakh claims, and disbursed Rs. 17,600 crore to the families of deceased subscribers.
The claim settlement ratio, as reported by the participating insurance companies to the government, stands at 99.95 percent. It means that when a family arrives at the bank with a death certificate and a claim form, the money reaches them in nearly every case.
Within this national picture, LIC occupies a central position.
Today, LIC is among thirteen life insurance companies distributing PMJJBY through partner banks. LIC has active tie-ups with 808 banks across the country. During the current policy year from June 2025 to May 2026, 3.61 crore bank account holders have enrolled in PMJJBY with banks tied up with LIC.
Cumulatively since inception, LIC has enrolled 21.49 crore subscribers under PMJJBY and paid 4.70 lakh claims to the families of deceased subscribers, amounting to Rs. 9,414 crore. Behind that aggregate lies a succession of individual settlements, each one reaching a family at its most exposed moment.
The COVID-19 pandemic demonstrated both the relevance of the scheme and its latent vulnerabilities. Claims rose sharply as mortality awareness grew, and PMJJBY provided essential support to bereaved families during those years. The pandemic also exposed an awareness gap that the scheme has not yet fully closed.
Many families remain unaware that such a policy exists, or that the premium has been paid on behalf of the deceased member. There is no physical policy document issued under PMJJBY. In the absence of a nominee linked to the account, the family must navigate a separate legal process to establish their claim. The task of closing this awareness gap falls on banks, business correspondents, and district administration working in concert, particularly in rural areas where the scheme’s need is greatest.
The larger vision within which PMJJBY operates is the Government’s programme of Insurance for All by 2047.
LIC is steadily deepening its bank partnerships and extending the scheme’s footprint to cover more citizens within this timeline. Every new enrolment adds one more household to the network of formal financial protection.
When that household suffers a loss and the money arrives in the nominee’s account without litigation or delay, the scheme has done what the architects of financial inclusion intended it to do.