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Schemes and Acts related to Insurance

S. No Table of Contents

1. Government Schemes in Insurance

(a) Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

(b) Pradhan Mantri Surakhsha Bima Yojana (PMSBY)
(c) Pradhan Mantri Fasal Bima Yojana (PMFBY)
(d) Pradhan Mantri Vaya Vandana Yojana (PMVVY)
(e) Ayushman Bharat Yojana
(f) Central Government Health Scheme (CGHS)
(g) Varishtha Pension Bima Yojana
2. Insurance Related Acts

Government Schemes in Insurance

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY):

This scheme will be offered by Life Insurance Corporation and all other life insurers who are willing to join
the scheme and tie up with banks for this purpose.

Launched: 2015

Premium: Rs. 436

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Objective: Life insurance plan specially designed for underprivileged families in India

Features:

1. Simple Renewal

It gives one year of life insurance and can be renewed every year.

2. More comprehensive insurance coverage. PMJJBY provides life insurance coverage of Rs. 2 lakhs for a
yearly payment of Rs. 436.

3. There Are No Maturity Benefits

Because it is a term insurance plan, the policy solely covers life risks and no maturity benefits can be
collected.

4. Only a savings account is required.

To purchase this plan, the policyholder must have a savings bank account, and it can be purchased at any
partnered banks in India that have tie-ups with LIC and other private insurance providers.

5. No-hassle procedures

The coverage for life insurance begins 45 days following the date of enrolment. However, in the event of
death as a result of an accident, the total assured amount will be paid. Even if a policyholder leaves the
scheme for whatever reason, he or she can simply rejoin it.

Eligibility

 The PMJJBY is available to people in the age group of 18 to 50 years having a bank account who
give their consent to join/enable auto-debit.
 Aadhar would be the primary KYC for the bank account.

Pradhan Mantri Surakhsha Bima Yojana (PMSBY):

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Establishment: May 9, 2015

Objective: Pradhan Mantri Suraksha Bima Yojana is a government-backed accident insurance scheme in
India

Premium: Rs. 20 per annum

Features:

1. After the insured's untimely death in an accident, the policy's beneficiaries will get the death benefit.

2. The amount of the health insurance premium is automatically deducted from the associated savings
account.

3. Applicants can opt for a long-term coverage or an annually renewable plan, depending on their needs.

4. The exit and re-entry procedures are straightforward.

5. It comes with a number of tax advantages.

Eligibility:

1. This health insurance policy provides accidental insurance coverage at a low cost.

2. If the insured dies in an accident, the policy gives financial assistance to his or her dependents.

3. The insured no longer has to worry about missing premium payment deadlines with the auto-debit
option.

4. The policy provides secure processing as well as ongoing coverage.

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5. The insured has the option of continuing or terminating the plan as they see fit.

Coverage: Rs. 2 lakhs for Permanent total disability and Rs. 1 lakh for Permanent Partial Disability

Pradhan Mantri Fasal Bima Yojana (PMFBY):

Pradhan Mantri Fasal Bima Yojana (PMFBY) scheme was launched in India by the Ministry of Agriculture
& Farmers welfare.

Launched: 2016

Objectives:

 Providing financial assistance to farmers who experience crop loss or damage due to unforeseeable
circumstances
 Stabilizing farmers' incomes to secure their ability to continue farming Encouraging farmers to adopt
cutting-edge and contemporary agricultural techniques
 Assuring the flow of financing to the agricultural sector will help to increase crop diversity, food
security, and the sector's growth and competitiveness while also safeguarding farmers from
production risk.

Who are all Eligible?

 All farmers who have received Seasonal Agricultural Operations (SAO) loans from Financial
Institutions (FIs), often known as loanee farmers, will be required to purchase coverage for the
season's designated crop(s).

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 This Scheme is optional for non-loanee farmers.

Pradhan Mantri Vaya Vandana Yojana (PMVVY):

The Indian Government launched a pension scheme and it can be taken from 4 May 2017 to 31 March
2020.

The Pradhan Mantri Vaya Vandana Yojana maximum ceiling was raised by the Indian government to Rs.
15 lakhs in the 2018–2019 Budget Speech.

The Life Insurance Corporation (LIC) of India is where the scheme can be purchased both offline and
online. The fundamental goal of the programme is to give retirees a regular income during a period of
falling interest rates.

Eligibility:

 There are no specific eligibility criteria as such for PMVVY scheme except that the subscriber must
be a senior citizen, i.e. (60 years and above).
 The applicant must be an Indian citizen.
 There is no maximum entry age for the PMVVY scheme.
 The applicant must be ready to avail of the policy term of ten years.

Benefits:

 The pensioner will benefit from the plan's guaranteed return of 8% p.a. during the course of the
policy's ten-year term.
 Pension Payment: The pension will be paid in arrears if the retiree lives beyond the policy's
expiration date. Additionally, the pensioner has a choice in the method of payment.
 Death benefit: If the pensioner passes away during the policy's term, the beneficiary will receive the
purchase money returned.

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 Benefit of Maturity: The purchase amount will be paid along with the final pension instalment if the
pensioner lives out the whole policy tenure.
 Loan facility: After completing 3 years of the policy, the pensioner can avail loans against the policy.
A maximum of 75% of the purchase price can be availed as a loan
 Free-look period: The policyholder can surrender the policy within 15 days if he/she is not happy
with the terms of the policy.

Ayushman Bharat Yojana

 The Government of India's Ministry of Health and Family Welfare administers the Ayushman Bharat
Yojana or Pradhan Mantri Jan Arogya Yojana (PMJAY) universal health insurance programme.
 More than 40% of the population in the country will now have access to free healthcare services
because to PMJAY.
 The scheme offers a health cover of Rs 5 Lakhs.
 This scheme pays for prescription drugs, medical care, diagnostic expenditures, and pre-
hospitalization fees. This healthcare programme can help India's poorest families.

Central Government Health Scheme (CGHS):

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 The Central Government Health Scheme (CHGS) offers medical treatment to Central Government
employees and pensioners who have signed up for the programme.
 It covers medical care provided by several medical systems, including allopathy, homoeopathy,
Ayurveda, Unani, Siddha, and yoga. Over 35 lakh beneficiaries are included in the beneficiary base,
which spans 71 cities.

Facilities offered:

These are the facilities that can be availed under CGHS:

 Out Patient Department treatments including the issue of medicines

 Indoor treatments at government and empaneled hospitals
 Diagnostic tests at government and empaneled diagnostic centers.
 Specialist Consultation at government hospitals or polyclinics
 Medical consultation and dispensing of medicines in Ayurveda, Homeopathy, Unani and Siddha
system of medicines (AYUSH)
 Cashless facility is available for treatments in empaneled hospitals and diagnostic centers
 Reimbursement of expenses for emergency treatments availed in government or private hospitals
 Reimbursement of expenses for the purchase of hearing aids, artificial limbs, etc., as specified
 Family Welfare, Maternity and Child Health Services.

Varishtha Pension Bima Yojana

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In the Union Budget 2014-2015, the Indian government announced the Varishtha Pension Bima Yojana
(VPBY). The Life Insurance Corporation (LIC) oversees the VPBY's administration. The VPBY provides
income security with a guaranteed rate of return to seniors over the age of 60.

Lock-in period: 15 years

Eligibility: available for citizens aged above 60 years

Benefits:

 All pension payments are made by ECS or NEFT. Thus, there is no requirement to encash the
amount through a cheque or receive a demand draft.
 Compared to many other senior citizen pension plans, it offers an assured pension with an annual
interest rate of 8% that is guaranteed.
 The policyholders can choose between getting their pensions monthly, half-yearly, quarterly, or
annually.
 Within 15 days of the policy's receipt date, policyholders may cancel their coverage. In this situation,
the premium money will be returned after deducting the stamp duty fees.
 It offers death benefits also. The premium payment will be returned to the nominee or spouse after
the policyholder's passing.
 The policyholder can take a loan against the VPBY after three years.

Acts Related to Insurance

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Insurance Act 1938

Sections:

Section 1: Short Title, Extent and Commencement

Section 2: Definition

Section 2A: Interpretation of Certain Words and Expressions

Section 2B: Appointment of Controller of Insurance

Section 2C: Prohibition of transaction of insurance business by certain persons

Section 2CA: Power of Central Government to apply provisions of this Act to Special Economic Zones

Section 2CB: Properties in India not to be insured with foreign insurers except with the permission of
Authority

Section 2D: Insurers to be subject to this Act while liabilities remain unsatisfied

Section 3: Registration

Section 3A: Payment of annual fee by insurer

Section 4: Minimum limits for annuities and other benefits secured by policies of life insurance

Section 5: Restriction on name of insurer

Section 6: Requirements as to capital

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Section 10: Separation of accounts and funds

Section 11: Accounts and balance-sheet

Section 12: Audit

Section 13: Actuarial report and abstract

Section 14: Record of policies and claims

Section 15: Submission of returns

Section 26: Alterations in the particulars furnished with the application for registration to be reported

Section 27: Investment of assets

Section 27B: Provisions regarding investments of assets of an insurer carrying general insurance business

Section 27 E: Prohibition for the investment of funds outside India

Section 29: Prohibition of loans

Section 31: Assets of insurer how to be kept

Section 32B: Insurance business in rural and social sectors

Section 33: Power of investigation and inspection by Authority

Section 35: Amalgamation and transfer of insurance business

Section 38: Assignment and transfer of insurance policies

Section 39: Nomination by policy-holder

Section 42: Appointment of insurance agents

Section 42A: Prohibition of insurance business through principal agent, special agent and multilevel
marketing

Section 42E: Commission, brokerage or fee payable to intermediary or insurance intermediary

Section 46: Application of the law in force in India to policies issued in India

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Section 49: Restriction On dividends and bonuses

Section 63: Particulars to be filed by insurers established outside India

Section 64C: Councils of Life Insurance and General Insurance

Section 64R: General power of Life Insurance Council and General Insurance Council

Section 101A: Re-insurance with Indian re-insurers

Section 105: Wrongfully obtaining or withholding property

Section 114: Power of Central Government to make rules

Section 120: Determination of market value of securities deposited under this Act

Insurance Laws and Regulations:

 Insurance Rules 1939

 Insurance Laws (Amendment) Act 2015
 General Insurance Business (Nationalisation) Act,1972
 Redressal of Public Grievances Rules,1998
 Foreign Exchange Management (Insurance) Regulations,2000
 Insurance Laws (Amendment) Ordinance 2014
 Insurance Regulatory and Development Authority of India Regulations, 2016
 Insurance Ombudsman Rules, 2017
 Life Insurance Corporation rules, 1956
 Life Insurance Corporation (Amendment) Act, 1957
 Life Insurance Corporation of India (Agents) Regulations, 2017
 General Insurance Business (Nationalisation) Act, 1972
 Life Insurance Corporation (Amendment) Act, 2011

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