Life Cover under Pradhan Mantri Jan Dhan Yojana: A Complete Guide

Know everything about Pradhan Mantri Jan Dhan Yojana (PMJDY) and how it provides financial security to account holders. Learn about the eligibility criteria and benefits of this scheme.
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3 min
04-September-2024

The Pradhan Mantri Jan Dhan Yojana (PMJDY) stands as one of India's most ambitious financial inclusion initiatives, aiming to provide access to financial services for all. This comprehensive scheme has transformed millions of lives by ensuring banking services reach the remotest corners of the country.

Launched by Prime Minister Narendra Modi on 28th August 2014, the Pradhan Mantri Jan Dhan Yojana (PMJDY) is a flagship financial inclusion scheme. It aims to provide every household in India with access to basic banking services, including savings accounts, remittances, credit, insurance, and pension services. The scheme aims to bridge the gap between the banked and unbanked population, thereby promoting financial empowerment and inclusive growth.

In this article, we explore the key aspects of PMJDY, including eligibility criteria, benefits, account opening procedures, scheme details, life cover under Pradhan Mantri Jan Dhan Yojana (PMJDY), and its impact on the nation's financial landscape.

An overview of Pradhan Mantri Jan Dhan Yojana (PMJDY)

PMJDY focuses on expanding banking services to the underprivileged sections of society, including rural areas, urban slums, and remote regions. The scheme encourages the opening of bank accounts for all individuals, especially those from economically weaker sections, with a focus on women and marginalised communities. PMJDY accounts come with various benefits and features designed to enhance financial inclusion and promote savings habits among account holders. Additionally, the scheme includes life insurance cover under PMJDY, which provides a basic life insurance benefit to account holders, further supporting financial security and inclusion.

Eligibility criteria for PMJDY

The eligibility criteria for opening a PMJDY account are simple and inclusive:

  • Any Indian citizen, regardless of age, can open a PMJDY account.
  • There is no requirement for a minimum balance to open an account.
  • The account can be opened with any valid identity and address proof, such as Aadhaar card, voter ID, driving license, or passport.

Benefits of Pradhan Mantri Jan Dhan Yojana

The Pradhan Mantri Jan Dhan Yojana offers a wide range of benefits, including life insurance cover under PMJDY to account holders:

  • Zero balance account: PMJDY accounts can be opened with no minimum balance requirement, ensuring accessibility to all sections of society.
  • Interest on deposits: Account holders are eligible to earn interest on their deposits, promoting savings habits and financial stability.
  • Rupay debit card: Every PMJDY account comes with a Rupay debit card, enabling cashless transactions and access to ATMs.
  • Direct Benefit Transfer (DBT): Government subsidies and welfare benefits are directly credited to PMJDY accounts, ensuring efficient and transparent delivery of social welfare schemes.
  • Life insurance coverage: PMJDY accounts come with life insurance coverage, providing financial security to the account holder's family in the event of their demise.
  • Accidental insurance: Account holders are also covered under an accidental insurance scheme, offering additional financial protection in case of accidental death or disability.

How to open a PMJDY account?

Opening a PMJDY account is a simple and hassle-free process:

  • Visit your nearest bank branch or Business Correspondent (BC) outlet.
  • Fill out the PMJDY account opening form with the required details.
  • Submit the necessary documents, such as identity and address proof.
  • Provide your biometric details, including fingerprints and iris scan, as part of the Know Your Customer (KYC) process.
  • Receive your PMJDY account passbook and Rupay debit card once the account is opened.

What is the PMJDY progress and impact?

Since its launch, PMJDY has made significant strides in expanding financial inclusion across the country:

  • Over 43 crore PMJDY accounts were opened as per reports in 2021, bringing millions of previously unbanked individuals into the formal banking system.
  • The scheme has facilitated the direct transfer of government subsidies and benefits to the beneficiaries' bank accounts, eliminating leakages and ensuring efficient delivery of welfare schemes.
  • PMJDY accounts have played a crucial role in promoting digital payments, enabling account holders to transact seamlessly and avail banking services at their doorstep.

What are the financial literacy initiatives?

Alongside account opening, PMJDY also emphasises financial literacy and awareness among account holders:

  • Financial literacy camps and awareness programs are conducted regularly to educate account holders about the benefits of savings, digital payments, and insurance schemes.
  • These initiatives aim to empower account holders with financial knowledge and skills, enabling them to make informed decisions and manage their finances effectively.

PMJDY scheme details

Key details of the PMJDY scheme include:

  • Life insurance coverage: PMJDY accounts offer life insurance coverage of Rs. 2 lakh for the account holder.
  • Accidental insurance: Account holders are covered under an accidental insurance scheme with coverage ranging from Rs. 1 lakh to Rs. 2 lakh, depending on the type of account and premium paid.
  • Overdraft facility: Eligible PMJDY account holders can avail of overdraft facilities of up to Rs. 10,000, subject to certain conditions.

What is the life insurance coverage under PMJDY?

Following are the key features of the life insurance cover under PMJDY:

  • Coverage amount: Provides life insurance cover of Rs. 2 lakh for the account holder.
  • Eligibility: Available to PMJDY account holders between the ages of 18 and 59.
  • Policy term: Valid for one year, renewable annually based on policy terms.
  • Benefit: Ensures financial security for the account holder's family in case of the account holder's untimely demise, offering peace of mind and financial stability.

Conclusion

The Pradhan Mantri Jan Dhan Yojana has emerged as a transformative initiative in India's journey towards financial inclusion and empowerment. By providing access to basic banking services, insurance coverage, and credit facilities, PMJDY has empowered millions of individuals, especially those from marginalised communities, to become financially independent. As the scheme continues to evolve and expand its reach, it remains a beacon of hope for millions of unbanked and underserved individuals across the nation.

Frequently asked questions

What is the amount of life insurance cover under PMJDY?
The Pradhan Mantri Jan Dhan Yojana (PMJDY) offers a life insurance cover of Rs. 2 lakh for each account holder. This sum is paid to the nominee or beneficiary upon the death of the account holder, providing financial support to their family. The life insurance cover is designed to offer substantial aid, helping the deceased's family to manage their financial needs and maintain their standard of living during challenging times.
What is the death cover in PMJDY?
The death cover under PMJDY refers to the life insurance benefit provided to account holders, which is Rs. 2 lakh. This benefit is disbursed to the nominated beneficiaries upon the death of the account holder. The primary objective of the death cover is to offer financial protection and support to the family members of the deceased, ensuring they have the necessary funds to cope with immediate expenses and financial obligations following the loss of the primary breadwinner.
Who is eligible for life insurance cover under PMJDY?

Eligibility for the life insurance cover under PMJDY includes:

  • Any individual who has a PMJDY account.
  • The account holder must be between the ages of 18 and 70 years.
  • The life insurance benefit is typically available for the first PMJDY account opened by an individual. These criteria ensure that a wide range of individuals, particularly those from economically disadvantaged backgrounds, can benefit from the financial security provided by this life insurance cover.
What is the insurance benefit in the PMJDY?

The insurance benefits associated with the PMJDY card include:

  • Accidental Insurance Cover: The Rupay debit card issued with PMJDY accounts provides an accidental insurance cover of up to Rs. 2 lakh. This cover includes protection against accidental death and permanent total disability, ensuring that the account holder's family receives financial support in the event of an accident.
  • Life Insurance Cover: In addition to accidental insurance, PMJDY account holders also benefit from a life insurance cover of Rs. 2 lakh. This cover is paid out to the nominated beneficiaries upon the death of the account holder, providing a financial safety net for the family.
Is it possible to claim both PMJJBY and PMSBY simultaneously?

Yes, you can claim benefits from both the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY) if you are enrolled in both schemes. Each provides different types of coverage.

What is the age limit for PMSBY?

The age limit for the Pradhan Mantri Suraksha Bima Yojana (PMSBY) is between 18 and 70 years. Individuals within this age range can enrol in the scheme, which offers accidental death and disability coverage at a low annual premium. Eligibility also requires a valid bank account.

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