The poor and the economically weaker sections of the society seldom avail insurance coverage for themselves against deaths and disablements. However, they are prone to natural or accidental deaths and disablements and when the breadwinner of the family faces these contingencies the family suffers a financial loss. It becomes difficult for the economically weaker sections of the society to arrange for an insurance coverage because of affordability. That is why the Government of India has launched various social security schemes for the poor. These schemes aim to provide welfare benefits and the Aam Admi Bima Yojana is one such social security scheme which has been launched by the Government. Let’s understand the scheme in details –
The Aam Admi Bima Yojana is a social security scheme which was launched on 2nd October 2007 to provide a group insurance cover to individuals belonging to specified groups. The scheme provides insurance coverage against natural and accidental deaths and disablements. On 1st January, the Aam Admi Bima Yojana scheme was merged with the Janashree Bima Yojana Scheme to provide a wider scope of coverage to eligible individuals.
Here are the salient features of the Aam Admi Bima Yojana scheme –
There are certain eligibility parameters for availing coverage under the Aam Admi Bima Yojana scheme. These parameters are as follows –
The identified groups are as follows –
Brick kiln workers
Handloom and Khadi weavers
Leather and tannery workers
Physically handicapped people who are self-employed
Papad workers who are associated with SEWA
Primary milk producers
Auto drivers or rickshaw pullers
Tendu leaf collectors
Scheme for the urban poor
Women of hilly areas
Manufacture of wood products
Manufacture of leather products
Food stuffs like sugar or khandsari
Manufacture of paper products
Rubber and coal products
Mineral products like earthen toys manufacture
Chemical products like candle manufacture
Transport drivers association
Women associated with self-help groups
Overseas Indian workers
Unorganized workers covered under the Rashtriya Swasthya Bima Yojana
The Aam Admi Bima Yojana covers the following instances –
Besides these inbuilt coverage benefits, a free additional coverage benefit is also provided which is called Scholarship Benefit and is available for up to two children of the insured member. The children should be studying in Classes 9th to 12th.
The coverage amount for each coverage benefit is as follows –
Sum insured payable
Accidental permanent total disability
Accidental permanent partial disability
INR 100 per month per child
Source: Press Information Bureau
There are some excluded coverage instances in the Aam Admi Bima Yojana scheme. These include death or disability arising out of the following –
Moreover, medical expenses which are incurred due to an accident are not covered.
The Aam Admi Bima Yojana scheme has very low premiums. The premium is INR 200. 50% of the premium would be subsidized and paid from the Social Security Fund of the Government. Moreover, if the individual belongs to rural landless households, the remaining 50% of the premium would be paid by the State Government or Union Territory. If, on the other hand, the individual any of the recognised vocational groups, the remaining 50% of the premium would be paid by the nodal agency or the member himself/herself or the State Government or Union Territory.
What are the documents required to avail the scheme?
To get covered under the Aam Admi Bima Yojana, the following documents would have to be submitted by the eligible individuals –
Once any of these documents are submitted, the individual would be enrolled under the coverage.
The process of making a claim under the Aam Admi Bima Yojana scheme depends on the type of contingency suffered. The claims are settled by LIC by a direct NEFT to the bank account of the beneficiary. If NEFT facility is not available, the money is credited to the bank account of the beneficiary after obtaining an approval from a competent authority. Moreover, if the approval has been obtained, the claim can be paid through an account payee cheque or through any other mode as chosen by LIC.
The different types of claims and their respective claim procedures are as follows–
In March 2015, data was made available showing the implementation of the scheme. By that time, about 32.75 lakh lives were covered under the scheme. Other important figures included the following:
Given the sufficient insurance cover and low premiums, the scheme is expected to become popular among the poor and would increase insurance penetration in the rural areas of India. This would, in turn, increase the standard of living of the rural population and help in the growth of the Indian economy.
The Aam Admi Bima Yojana was launched by the Government of India to provide free or subsidized insurance cover to the rural population of India or to individuals who belonged to the economically weaker sections of the society. The Aam Admi Bima Yojana is essentially a scheme of social security which aims for social welfare of the backward classes.
The scheme is currently being offered only by Life Insurance Corporation of India (LIC). Thus, interested applicants can avail the coverage only from LIC through its authorised Nodal Agencies.
Yes, nomination is a must when an individual makes an application for insurance under Aam Admi Bima Yojana scheme. At the time of application, the application form would also contain a nomination form which the individual should fill in and appoint a nominee. The details of the nominee should be clearly stated so that in case of a death claim the nominee can collect the claim amount easily. The nomination form which is filled and submitted by the insured individual would be kept in the custody of the Panchayat of the village or the Nodal Agency. The form would then be forwarded to LIC along with the death claim documents when the insured member dies.
The insured member would have to pay 50% of the premium, which is INR 100, only if he/she belongs to families Below Poverty Line (BPL). If the insured belongs to rural landless households or the identified vocational groups, he/she would not have to pay any premium for the scheme.
Coverage under the Aam Admi Bima Yojana scheme is available only for individuals belonging to BPL families, rural landless households or one of the 48 specified vocational groups. If you do not belong to any of these categories, coverage under Aam Admi Bima Yojana would not be available for you. You can, however, avail coverage for accidental death and disablement through personal accident policies which are available in the market.