Community Managed Social Security Intervention

By SERP , Andhra Pradesh

A. Abstract:
The Social Security strategy is initiated in SERP in the year 2008 to encourage and
ensure that every rural poor household, including the disadvantaged groups (disabled,
widow, and children), in the State of Andhra Pradesh have access to affordable pension
and insurance services to protect from risks and vulnerabilities of both their life cycle risks
and livelihoods. Through the Social Security Unit, SERP aims to providing affordable,
easily accessible, quick and quality insurance products and services to the poor in SHGs.

B. Need:
It is gauged that more than 250 poor people who are the head or bread winners of the
SHG members’ families are dying every day in the state of Andhra Pradesh. Eventually,
the rural poor families face enormous problems, if they lose their bread winner due to
untimely death. The loss of head or bread winner leaves the family in a shudder to fight
for survival. Moreover, the family comes under sever stress and shock, both psychological
and economic. As an upshot the households end up in a disastrous situation and is flung
into irrecoverable abject poverty

C. Targeted Goals:
 To initiate relevant and affordable insurance products /schemes by massification
to protect the poorest of the poor and landless agriculture laborers from risks on
death and disability.
 To provide credit shield insurance to all the eligible and needy Self Help Group
(SHG) women so as to perpetuate the institutions of the poor as well as to protect
her dependents.
 To manifest that every person is insurable and their children need to be financially
supported for education through scholarships.
 To provide social security and dignity to the SHG in their old age under Abhaya
hastham – a Co -Contributory Pension and Insurance Scheme for SHG women.

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  To provide insurance to all their milch animals and other livestock animals, as
livestock is the primary livelihood activity as well as asset for resource poor
households in rural Andhra Pradesh.
 To achieve transparency, accountability and to provide quick and quality services.
 To co-ordinate across various departments to ensure that none of the eligible and
needy persons are deprived of the welfare schemes meant for the poor.
 To sensitize the SHG women and federations on cause of deaths and to make
them to gain knowledge on preventive measures to decrease the mortality rate.

D. Schemes and outreach :

In order to protect the poor from shocks due to sudden death and disability and to
provide financial security and dignity to the old SHG Women, SERP is
implementing different social safety net interventions from 2008 onwards.

Schemes Implemented by Social Security Unit:

 Life & Disability Insurance cover : 70 lakhs

 Co-Contributory Pension Scheme(Dr YSR Abhayahastham): 43 Lakhs

 Live Stock Insurance Cover : 1.19 lakhs

 Group Credit Linked Life Insurance : 1.60 lakhs

D.1 Schemes:

D.1.1.Aam Aadmi Bima Yojana(AABY)

The Aam Aadmi Bima Yojana is a scheme of the Central & State Governments,
administered by LIC of India for the benefit of rural landless agricultural labourer
households. Under the Scheme, all rural landless households would be provided life and
disability cover. Aam Aadmi Bima Yojana is a social security measure for rural landless

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agriculture labourers in the state of Andhra Pradesh. It is the largest such coverage in the
country.

Eligibility:
 The member should be in the age group of 18 -59 years.
 The members should be head of the family (bread winner) or one earning member
in the family of rural landless household who rely on agricultural labor as their primary
source of livelihood.
 Holder of White Ration Card.

Premium:
 Members who are in the age group of 18 to 59 years, should pay Rs.200 as
premium (the Central Government will contribute Rs.100 and remaining Rs100 will be
contributed by either State Government or by individual). Rs.15 shall be paid every
year as service charge to renew their Policy.

Claim Amount:
 In the event of death of a member prior to the terminal date, the sum
assured of Rs. 30000 will become payable to the nominee.
 Accidental Benefit: When accident occurs, the following shall be payable.
 On death due to accident Rs.75,000/-
 Permanent Total Disability due to accident Rs. 75,000/-
 Loss of one eye or one limb in an accident Rs.37,500/-

Scholarships:
A free add-on scholarship benefit for the children (only two) of the members of AABY
is provided under this scheme. Every month, two children studying between 9th and
12th standard are paid Rs.100/- This scholarship, however, is payable half yearly.

 Progress of Claim & Scholarships settlement under AABY

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 Combined State of Andhra Pradesh ( 22 districts) Residuar
y state of
AP (13
districts)
upto
October
2014

AABY 2008- 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 (

09 upto
Oct’14)

Enrolled 38.00 38.00 52.00 52.00 60.94 38.00 24.88

members( In
lakhs)

Claims Settled 34932 34521 43057 36735 47946 33309 9710

Claims Settled 111.78 110.47 137.78 117.55 155.82 108.25 31.56

(Amount in
Crores.)

Scholarship 3,33,74 2,49,13 3,15,562 4,16,29 4,12,981 3,93,09

(Members) 5 5 3 1

Scholarship 40.05 29.90 37.87 49.96 49.96 47.17

(Amount in
Crores.)

Govt 38.00 38.00 60.80 60.80 60.80 60.80 39.18

Contribution
for
Premium(Amo
unt in Crores.)

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D.1.2. Abhaya Hastham

Old age has its own set of problems.. Physical strength deteriorates, sources of revenue
dry up and the elderly become dependant on the younger generation who generally do
not care for their parents. Women are the worst sufferers as they generally tend to spend
disposable income on their children rather than saving for their old age. Taking
cognisance of this fact, the SERP initiated this scheme which would provide the aged
with social and income security.

Act:
In this regard an act was enacted as Andhra Pradesh Self Help Groups (SHG) Women
Co-contributory Pension Act, 2009. The Act states that
 Nodal Implementation Agency means the Society for Elimination of Rural Poverty
and any other such agency that may be notified by the government and
empowered to implement and administer the scheme.
 Pension fund manager means the Life Insurance Corporation of India or any other
Public Sector undertaking, regulated by an authority as may be prescribed by the
Government.

Eligibility
 All Indira Kranthi Patham (IKP) recognized SHG women, from rural and urban
areas.
 Should be a currently active SHG member and been a member for at least a year
(SHG member by 1/12/2008).
 Holder of white ration card.
 The SHG should recommend the case of the member and certify the age of the
member through a resolution

Terms and Conditions

 The SHG women have to opt for the Scheme and shall apply to the SHG.

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 A member can make a minimum contribution of Re. 1 per day and government
would co-contribute Re. 1 per day.
 Contribution is on annual basis and is to be paid at the beginning of the each year
by depositing the amount into respective pension account bank.
 A subscriber who crosses 60 years of age and has fulfilled the prescribed
conditions shall be entitled to receive a monthly pension.
 Members above the age of 50 years, along with their regular contribution, will have
to ensure that they contribute minimum of 10 years worth contribution (Rs 3650) by
the age of 60, so as to become eligible to draw pension.
 In the event the subscriber does not fulfill the prescribed conditions (defaulting
more than 2 years) of the scheme, the subscriber's individual pension account shall
be closed and the available contributions of the subscriber and earnings from such
contributions in the account shall be transferred to the subscriber.
 Enrollment of new members would take place in February and March every year.
 In the second year, only the members between the age of 18 and 60 years would
be eligible to join. From the third year onwards members between the ages of 18 to
40 years would only be eligible to join the scheme.
 Each member shall make a nomination along with application conferring the right
to receive the amount that may stand to her credit in the event of her death. And on
member‘s request the nominee details can be changed at the time of annual payment.

Benefits
 Each member would become eligible for minimum monthly pension of Rs. 500 or
above, subject to fulfillment of conditions to be prescribed, on crossing the 60 years
of age, depending on the number of years of contribution and quantum of contribution
made by the member.
 All women between 18 to 59 years would be eligible for life insurance cover up to
 A sum of Rs. 30,000 in case of natural death
 Rs. 75,000 in case of Accidental death
 Rs. 75,000 for permanent disability

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  Rs. 37,500 for partial disability
 Scholarship of Rs. 1200 per annum for their children, studying 9th, 10th classes,
intermediate and Industrial Technical Institute (ITI).
 Members who are already receiving scholarships for their kids from LIC under any
other scheme would not be eligible for receiving this scholarship.
 On death of the subscriber during the contributory phase (less than 60 years), the
available contributions of the subscriber and the government‘s co-contribution
along with accrued earnings on such contributions shall be transferred to the
nominee of the subscriber. And also the insurance benefit would be transferred to
the nominee.

 On death of the member during the pension payout phase (60+ years), the
available contributions of the subscriber and the government‘s co-contribution
along with accrued earnings shall be transferred to the nominee of the subscriber.
Progress of Claim & Scholarships settlement under JBY in Abhayahastham

Combined State of Andhra Pradesh ( 22 districts) Residuary

state of AP
(13 districts)
upto
October
2014

Abhayahastham 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15

Claims Settled 16251 15353 15714 21547 11416 7462

(members)

Claims Settled 52.07 Cr 49.13 Cr 50.28 Cr 70.02 Cr 37.10 Cr 24.25

(Amount in Rs.)

Scholarship 5,31,315 4,62,245 5,99,694 6,03,502 7,43,981 -

(Members)

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 Scholarship 31.88 Cr 55.47 Cr 71.96 Cr 72.42 Cr 89.28 Cr -
(Amt in Rs.)

Pensioners 3,84,482 4,30,006 5,12,701 5,22,724

Govt Co- 153.55 220.00 504.190 330.00 330.00 55.00 Crs

contribution Crs Crs Crs Crs Crs

Note: The policy period of Abhayahastham is from November to October every year upto
2012-13/In the year 2013-14 the policy period is only from November to March 21014 -
15 . From the year 2014-15 onwards the policy period has been changed to April to March.

D.1.3 Live Stock Insurance:

 Live Stock insurance protects the poor and stretches their ability for enhanced
asset creation for continuous livelihoods. The scheme is for SHG members owning
milch animals
 It has been implemented in seven districts during 2011-12 and in the year 2012-
13 it has been made compulsory to enroll all livestock which has been purchased
by the community members under POP, PPK, Sthreenidhi loans, the enrolment
particulars is as follows
 Rs 4.50 per 100 on the value of the animal is the premium to be paid for 3 years.
 Rs.25/- shall be charged each beneficiary for providing insurance services like
enrolment, documentation, claim settlement through Call Centres and Bima
Mithras at their door steps
 United India Insurance Company will settle the Claim amount basing on the Death
Certificate of the animal from the Gram Samakhya.
 The value of the animal will be the total claim amount.

D.1.4 Loan insurance:

 To protect the family members of an SHG member for financial risks, in the event
of her death

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  To safeguard the institution of SHG from repayment burden, when a borrowing
members dies
 To ensure the perpetuity of the SHG, providing loan insurance to all the borrowing
members
 To ensure 100% repayment at all levels even in the turbulence time and to
increase the size of loans to SHG members, by creating a confidence among the
Bankers.
Conditions and premium
 All SHG women taken SHG Bank linkage
 Age between 18 to 69 years
 A premium of 0.4% per annum on loan taken by the members including service
charges.
Benefits
In the unfortunate event resulting in death of the member, the claim amount will be
used to repay her outstanding and also payoff her loan instalments paid till that day.

E. Implementation Methodology

E.1. District Call Centre

In all the Districts an exclusive Call Centre in made operational for the
implementation of these interventions. The Zilla Samakhya have taken the
responsibility of establishing these Call Centres. A Call Centre is a hub of all the
insurance interventions at district level, administered and managed by the Zilla
Samakhyas with the support of a few human resources. A Call Centre is equipped
with infrastructure like, Computers with broad band internet facility, scanners,
printer etc. All the information is stored in the computer and managed with the
support of software ‘Call Centre Manager’ specifically designed for this purpose.

E.2. Bima Mithras

Bima Mithra is a sensitive support social capital selected from among the
active SHG members who are willing to visit the bereaved families and provide
them an interim relief of Rs.5000/- as soon as they receive the intimation from Call

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 Centres. They are identified from the mandal where ever ATMs are located. The
payment of Rs.5000/- shall be made by Bima Mithras through ATMs in general
and where ever, it is not possible, payment shall be made through MS within 24
hrs but it shall be reimbursed by ZS immediately. Thus, for each and every Mandal
in all the Districts Bima Mithras are functioning to provide quick and quality services
to the insured community

E.3. Web-Managed Data Base: (www.aaby.ap.gov.in &

www.serp.ap.go.in/AH)
In order to achieve transparency, accountability & effectiveness in the
implementation of interventions, SERP has established Web Based MIS and claim
settlement system. All the Call Centres are connected to this web site through
internet, where in all the claim particulars and claim documents uploaded on day
to day basis. The LIC has introduced electronic-claim settlement system for
speedy disposal of the claim and a dedicated satellite office has been created by
LIC for this purpose and shall have regular access for down loading the
documents. It is a public domain which can be accessed by any individual
(common man) to track the status of claim settlement process not only the
Government & LIC. The web site contains member, village, mandal, district,
gender, caste wise details. It projects member’s profiles and generates all types
of analytical reports basing on age and other parameters. It also contains list of
children eligible for scholarship with details like their class, schools, their location,
and the status of payment of scholarships etc.

E.4 .Key Interventions in the System:

• Letters are being sent to the bereaved families informing the status of the claims at
the time of registration, requirement of documents and final claim amount sanctioned
from SERP.
• Scanners have been provided to all Mandal Samakhyas to scan and upload the
claim documents from mandal level.

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• Transferring of final claim amount to the Nominee through EFMS to the Nominee
Account or VO Account
• Social audit of claims and scholarships are conducted at regular intervals to bring
transparency and accountability in all the social security schemes.
• All the Policy holders photos are captured through Mobile application and stored as
a precautionary measure to remove duplicates in the data and prevent false claims.
• In its first of its kind the VO has been authorized to issue the death certificate instead
of Doctor’s certificate, in case of a claim for a death of animal.
• ZS have procured Compactors for establishment of Central Record Keeping Agency
to safe guard all the documents of all Social Security initiatives.
• Voice SMS/SMS alerts – To Nominees, Bima Mitras , CBOs & IKP Staff for follow
up

E. 5. Non-Negotiable:
In order to ensure the quality service delivery through CBOs, the Project Directors
of DRDA-IKP are responsible to nurture the CBOs and facilitate them for 100%
achievement of the following certain stipulated non- negotiables. All the
stakeholders at DPMU level and MS level are expected to adhere to these guiding
factors.

 Intimation of claim at Call Centre from village within 1hr of the incident / demise
of the member;
 Payment of interim relief of Rs.5000/- to the nominee within 24 hours of the
claim registered;
 Submission of documents with death Certificates at Call Centre within 7 days;
 Uploading of the document at Call Centre as soon as they are received;
 Final Settlement of the Claims amount to the nominee within 30 days from the
date of demise and intimation at Call Centre;
 Positioning of Bima Mithras @ one per Mandal
 Ensuring the positioning and functioning of sub-committee members etc.

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 Payment of Abhaya Hastham pensions to the eligible pensioners on 1 st and 5th
of every month; And online up dation of pension acquittance shall be completed
on or before 15th of every month.
 Identification of all the eligible children of insured members for sanction of
scholarships and proper distribution of scholarships to the sanctioned children.

To achieve the above said non-negotiables, the following initiatives have taken
up by the DPMU.

 District level Monitoring committee meeting under the chairmanship of the

District Collector involving Supt. Of Police, DMHO, DEO should be conducted
once in a month to review the progress of the claims settlement under Aam
Aadmi Bima Yojana and JBY as envisaged by the Principal Secretary to
Government, Rural Development through D.O Letter No.
114/SERP/Insurance/08, Dt.08.07.2008 addressed to all the District Collectors.
 Facilitate the Zilla Samakhya to review the progress of claim settlements and
distribution of pensions with all the MS members in the regular monthly
meetings in a systematic manner for at least 1 hour.
 Sensitize the CBOs to ensure the functioning of Insurance and Abhaya
Hastham sub committees at MS and VO level. The sub committees shall be
provided required trainings and nurtured them to understand the processes and
to review the progress for better management of the schemes.
 Facilitate the ZS – Sub Committee to visit the Call Centre on every Monday to
understand the day to day processes of the Call Centre.
 Facilitate the MS – subcommittee to visit the MS once in fortnight to review the
status of claims and ensure the submission of claim documents to the Call
Centre.
 Ensure the visit of Area Coordinators and APMs to the bereaved families to
console and to collect required claim documents.

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E.5 . Service Delivery – Process of Claim settlement

Death of
Final settlement member Call to call centre
30 1 hour
days

Claim Information to
processing Bima Mitra

7 days of Upload
documents

5 hours
Payment of
Claim solatium
documentation $ 101

Figure 2 – :Claims Management Process

F. Partnerships:

SERP has entered into MoU with the following agencies for implementation of
various insurance and Co-contributory pension schemes for the SHG women
members and their spouses through CBOs.
S. Agency Services
No
1 Life Insurance Life & Disability Insurance schemes
Corporation of Fund Managed under Co-contributory Pension and
India Insurance scheme & Credit Linked Life Insurance
Scheme for SHG women
2 PFRDA NPS Lite – SWAVALAMBAN – Co-contributory Pension
scheme

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 3 United India Livestock insurance scheme
Insurance
Company Ltd
4 IndiaFirst Life Credit Linked Life Insurance Scheme for SHG women
Insurance
Company
Table2: Partnerships agencies with service provided

G. Benefits and Impacts:

Due to the Emergence of strong CBO structure with the handholding support of
SERP and the technology interventions the following results are achieved for the
year 2012-13 as per LIC data
 Out of the total 4,81,18,653 policies covered in the country, AP stands at first
position with a coverage of 1,12,77,341 (23.4%) policies
 Out of the total 1,30,160 claims settled through LIC in the country , AP stands at
first position with a settlement of 71,657 (55.0%) claims
 Out of the total 28, 26,407 scholarships sanctioned through LIC in the country,
AP stands at first position with a sanction of 12,23,497 (43.3%) scholarships.

H. Achievements:

Social Human Capital:

 CBO members were trained to support the community to actively take part in
the process of enrollment under various Life and Disability insurance and Co-
contributory Pension schemes and service delivery systems.
 “Bima Mithras”,positioned @ 1 bima mithra per mandal, to increase their
efficiency in quick & quality services to the insured families.
 CBO staff at Call Centre was trained on use of call centre software in claim
settlement process.

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Outcomes
 1,85,456 bereaved families provided claim amount of 601.79 Crores over the
last 6 years (2008 – 14).
 Rs 853 Crores in terms of long-term savings mobilized since the launch of
the Co-contributory pensions in 2009.
 3,04,500 Abhaya Hastham Pensioners benefitted to the extent of Rs 730.50
Crs @ Rs. 500 per month on crossing 60 years. Note: Rs 500 is the minimum
pension for people enrolled in the Co-contributory Pensions.
 Rs 376.06 Crores was transferred to 6.0 lakh insured families with children in
9th – 12th class as part of the Government of India’s Siksha Sahayog Yojana
Scholarship program.

I. Expected Outcomes
 It is expected that all the eligible rural poor ( 2.00 Crs) including Self Help Group
members, their spouses, landless agricultural labourers, construction and other
building workers in the State of Andhra Pradesh shall be encouraged access
affordable insurance services seamlessly and would be protected from risks and
vulnerabilities of livelihoods, thus creating a saturation.
 It is expected that all the enrolled members’ data shall be digitalized and each and
every individual members should be provided with a comprehensive Smart Cart
for the purpose of all the social security nets and risk migration of assets. It is also
expected use of IT shall be insisted at every juncture right from enrolment to the
claim settlement.
 It is expected that a strong and formidable institutional arrangement shall be made
available for the rural poor by upgrading the skills of the sub-committee members
to deal with community risk.
 It is expected a strong sensitive social capital from among the SHG members shall
be developed to provide front and back end services in respect of community risk
management.
 It is expected that the Centralized Call Centre at State level should have been
empowered with simple toll free number like 108 to easily access and to quick and

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 quality services with the support of District Call Centres for payment of interim relief
as immediate funeral assistance, procurement of claim proposals etc.
 It is expected that 13 Central Record keeping Agencies(CRAs) would be
maintained in all the 13 Districts to safeguard the physical documents and the
digital records of enrolled members under the Dr.Y.S.R.Abhaya Hastham.
 It is expected that all the Village Organisations shall create and build a corpus to
provide funeral assistance to the destitutes in the event of their death to have a
dignified burial /cremation etc.
 It is expected that Zilla Samakhyas shall be empowered to play a crucial role in
risk mitigation and management of social and financial security nets. They shall
also assume the role of insurance broker /intermediary to provide various
insurance and financial services to the rural poor.

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