LIC's Aam Aadmi Bima Yojana (AABY)

The Aam Admi Bima Yojana is an initiative taken by the Indian Government. This scheme provides life cover and disability cover to the citizens of Indian who live in rural areas or live below the poverty line. Launched on 2 October, 2007, this Social Security Scheme is mostly for the landless rural population. An annual premium of INR 200 per individual, one earning member of the family or the head of the family, is shared by the State as well as the Central Government, so that he/she doesn’t need to pay anything. Under the Government of India, the Finance Ministry, the merger of Social Security Schemes and Janashree Bima Yojana, Aam Admi Bima Yojana, came into effect from 1 January, 2013. The AABY is also managed by the LIC.

The plan not only includes people who are below the poverty line but also the ones who live in far-off areas with no urban amenities. With the Indian economy gradually going through a makeover, there is an urgent need to pull up the condition of the people of rural India. To help such people by uplifting them, is the main objective of this scheme, that provides an insurance cover in case of death or accidental death and disability of the head of the family or the earning member.

Eligibility Criteria for Aam Aadmi Bima Yojana Plan

The members who wish to avail the insurance facility must be in the age group of 18 to 59 years. Either the head of the family or any member who earns in a family which is below poverty line (BPL), can also be a member of this scheme. If the applicant is above the poverty line but is identified to be under a rural landless household, he is also eligible for the scheme.
There is a requirement to submit the following documents to be a member of the AABY, Aam Admi Bima Yojana. These documents are :

  • Voter’s ID Card
  • Ration Card
  • Aadhar Card
  • Birth Certificate (Issued in School)
  • Any other Government-Issued ID Card

Benefits of Aam Admi Bima Yojana

  • Death Benefit
    If the policyholder dies during the term of the policy, then the nominee of the policy will receive a sum assured of INR 30,000.
  • Permanent Disability Benefit
    In case of permanent disability of the policyholder, the claimant needs to submit evidence of the accident that has caused the disability. This certificate can either be from a Government Orthopaedician or a Government Civil Surgeon who has to state that the disability caused by the accident is the reason of the loss of limbs, and is permanent.
  • Accidental Death Benefit
    In case the policyholder dies in an accident or suffers a disability, the following provisions are given to the members :
    1. On Death, due to Accident INR 75,000
    2. Permanent Disability, due to Accident
    • Loss of Eyes or 2 Limbs
    • Loss of one Eye and one limb
    INR 75,000
    3. Loss of One Eye or One Limb in an Accident INR 37,500

  • Nomination
    • It is imperative for every member to appoint a beneficiary to receive the death benefit in case of his accidental/natural death.
    • Filing the nomination form is an important part when filing the Membership Form. It should be ensured that the details of the nominee are correct, so that at the time of filing a claim, the nominee does not face any problems.
    • The Nomination Form is kept under the custody of the Panchayat/Nodal Agency and is forwarded to the LIC when the death or disability claims are to be made.
  • Scholarship Benefits

    As a free Add-On benefit a Scholarship will be given to a maximum of 2 children of the nominee, who are studying in grades 9th to 12th, at the rate of INR 100 per month per child. This amount is payable bi-annually on 1.July and 1.January every year.

Joining the Aam Admi Bima Yojana

A Nodal Agency could be a Panchayat, NGO’s, Institutionalised Arrangements or a Self Help Group. When a request is made for enrolling into the Aam Admi Bima Yojana, the agency contacts Pension and Group Scheme office or a Branch Office of LIC and the proceedings are carried out.

How to apply for the Aam Admi Bima Yojana?

To apply for the Aam Admi Bima Yojana

  • The applicant needs to visit his Nodal Agency.
  • The Nodal Agency may be an institutionalised arrangement or any NGO appointed to manage the scheme.
  • It could be the Central Ministerial Department or Union Territory of India.
  • In case the applicant is from the ‘Rural Landless Household’, he needs to go to the appointed State Government or Union Territory.

Premium

  • A premium of INR 200 is charged initially per year from every policyholder, for a life cover of INR 30,000. Out of this amount, 50% is subsidised by the Social Security Fund.
  • For the Rural Landless Household, RHL, the remaining 50% of the premium is paid by the Union Territory/State Government.
  • For the other Occupational Groups the remaining 50% of the premium is paid by the Member and Union Territory and/or Nodal Agency and/or the State Government.

The procedure of Claiming Aam Admi Bima Yojana

In the unfortunate event of death or disability of the head of the family or the breadwinner, the nominee will receive the death benefit. These claims are to be settled by the P&GS Unit of LIC. A direct payment is made by them via NEFT. In some cases, when the NEFT service is not available, the claimed amount can be transferred directly to the nominee’s bank account. For this, however, an Account Payee Cheque and prior permission from the competent authority will be required.

  • Making a Death Claim
    • If in case the member passes away during the cover-term and when the policy is still in force, the nominee has to put in an application to request for the claim.
    • The application along with the Death Certificate is to be submitted at the designated Nodal Agency.
    • The appointed official from the Nodal Agency will verify the claim documents.
    • Once the verification is complete, the executive will submit the claim documents along with a certificate that the deceased was the head the family or was an earning member and a certificate that States that the family belongs to BPL or RHL or any other occupational group that come under the Aam Admi Bima Yojana.
    • After this, the Nodal agency will submit the application, duly signed and filled Claim Form, Original Death Certificate and an attested copy of the death certificate.
  • Making a Claim Procedure

    If the death of the policyholder is an accidental death then, a few additional requirements have to be fulfilled. Apart from the Death Certificate, the following are needed :

    • A copy of the FIR that has been filed
    • Report of the Post Mortem
    • Report of the Police Inquest
    • Final/Conclusion Report of Police
  • Making a Claim for Scholarship

    If the children of the Aam Admi Bima Yojana policyholder are eligible for the scholarship, he has to file an application once every six months and deposit it with the Nodal Agency. The procedure is as follows :

    • The students would be identified and then verified by the agency.
    • The list of the beneficiary students would be submitted to the concerned P&GS unit. The details of the students will include :
      • Name of the student
      • Name of the Student’s School
      • Class
      • Member’s Name
      • Master Policy Number
      • Membership Number
      • NEFT Details for direct payment

    Every six months, that is on 1st July and 1st January, the scholarship payment will be credited to the beneficiary student’s account. This money transfer will be done either via NEFT or bank account.

Occupations and Vocations covered under Aam Aadmi Yojana Plan

  • Beedi Workers
  • Brick Kiln Workers
  • Carpenters
  • Cobblers
  • Fishermen
  • Hamals
  • Handicraft Artisans
  • Handloom Weavers
  • Handloom & Khadi Weavers
  • Lady Tailors
  • Leather & Tannery Workers
  • Papad Workers attached to ‘SEWA’
  • Physically Handicapped Self Employed Persons
  • Primary Milk Producers
  • Rickshaw Pullers / Auto Drivers
  • Safai Karamacharis
  • Salt Growers
  • Tendu Leaf Collectors
  • Scheme for the Urban Poor
  • Forest Workers
  • Sericulture
  • Toddy Tappers
  • Powerloom Workers
  • Hilly Area Women
  • Food Stuffs like Khandsari / Sugar
  • Textile
  • Manufacture of Wood Products
  • Manufacture of Paper Products
  • Manufacture of Leather Products
  • Printing
  • Rubber & Coal Products
  • Chemical Products like candle manufacturer
  • Mineral products like earthen toys manufacturer
  • Agriculturists
  • Transport Drivers Association
  • Transport Karmacharis
  • Rural Poor
  • Construction Workers
  • Fire Crackers’ Workers
  • Coconut Processors
  • Aanganwadi Teachers
  • Kotwal
  • Plantation Workers
  • Women Associated with Self-Help Groups
  • Sheep Breeders
  • Overseas Indian Workers
  • Rural Landless Households
  • Unorganized workers covered under RSBY

FAQ’s on Aam Aadmi Bima Yojana Plan

The scheme was introduced in the year 2007, on October 2. Under the Finance Ministry, Government of India, the merger of Social Security Schemes and Janashree Bima Yojana, AABY, Aam Admi Bima Yojana, however, came into effect from 1 January, 2013.


With the Indian economy gradually going through a makeover, there is an urgent need to pull up the condition of the people of rural India and the people living in far-off areas, without basic amenities of life. To help such people by uplifting them, is the main objective of this scheme that provides an insurance cover in case of death or accidental death and disability of the head of the family or the earning member.


A nodal agency is the most direct office that is designated to solve the concerns such as consultation, implementation, supervision in regard with a project or scheme or service that is initiated by the government.


To apply for the Aam Admi Bima Yojana the applicant needs to visit his Nodal Agency. The Nodal Agency may be an institutionalised arrangement or any NGO appointed to manage the scheme. It could be the Central Ministerial Department or Union Territory of India. In case the applicant is from the ‘Rural Landless Household’, he needs to go to the appointed State Government or Union Territory.


The members who wish to avail the insurance scheme must be in the age group of 18 to 59 years. Either the head of the family or any member who earns in a family which is below poverty line (BPL), can also be a member of this scheme. If the applicant is above the poverty line but is identified to be under a rural landless household, he too is eligible.


Every policyholder is eligible for the scholarship, however, the Scholarship will be given to a maximum of 2 children of the nominee, who are studying in grades 9th to 12th, at the rate of INR 100 per month per child. This amount is payable bi-annually on 1.July and 1.January every year.