Pradhan Mantri Jyoti Bima Yojna (PMJJBY)
In this section of our module, we will discuss a government-backed Life insurance scheme called the 'Pradhan Mantri Jeevan Jyoti Bima Yojana' (PMJJBY) which was launched in the year 2015.
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a Government-of-India-backed pure life insurance scheme which is very affordable. Basically, it is a pure term insurance policy and available for people between the age group of 18- 50 years.
Important features of Pradhan Mantri Jeevan Jyoti Bima Yojana are: -
i. It is a government-of-India-backed pure life insurance scheme which is very affordable
ii. The policy provides life coverage for 1 year.
iii. The policy offers a maximum sum assured of ₹2 lakhs.
iv. As compared to the other term insurance policy the plan offers very low premium rates per year i.e. ₹330. Moreover, the premium rate is equal for all age groups ranging from 18 to 50 years.
v. The insured can renew the policy every year.
vi. According to one’s own choice, the insured can walk out of the scheme at any time and rejoin it in future.
vii. The claim settlement process offered by the policy is very simple and subscriber friendly.
There are certain cases under which the death benefit offered by the policy is terminated:-
i. If the insured person is above 55 years.
ii. The policyholder is insured through different bank accounts.
iii. If the insured has inadequate balance in a savings bank account to keep the insurance in force.
What are the benefits offered by Pradhan Mantri Jeevan Jyoti Bima Yojana?
The following benefits are offered by Pradhan Mantri Jeevan Jyoti Bima Yojana: -
i. Death Benefit
In case of demise of the insured person the PMJJBY provides a death coverage of ₹2,00,000 to the beneficiary of the policy.
ii. Maturity Benefit
As this is a pure term insurance plan, PMJJBY does not offer any maturity or surrender benefit.
iii. Tax Benefit
The premium paid towards the policy is eligible for tax deduction under section 80C of Income Tax Act. In case the insurance holder fails to submit form 15 G/15 H then any life insurance proceeds exceeding ₹1,00,000 will be taxable by 2%.