What are the key highlights of PMJJBY scheme?

We all tend to invest in wide range of insurance policies such as medical, vehicle, or life. The premiums of such policies cost between a few to several thousand rupees every year. But there are specific sections of the society who cannot afford to invest in these only because every rupee earned gets dedicated towards sustenance. Noting this down, the Indian Prime Minister Narendra Modi launched the Pradhan Mantri Jeevan Jyoti Bima Yojana around May 2015. It is a renewable term policy.

Following are some highlights of the same –

Premium and sum assured

You can buy the PMJJBY by paying a small annual premium, which is INR 330. Since it is a term policy, it comes with a validity of one year. The policyholder must renew them yearly for continuing the insurance benefits. The scheme offers a maximum amount of INR 2 lakh as the sum assured to the policyholder owing to the death of the holder. Now, since it is a term policy, there no maturity or surrender benefit associated with the same.

Eligibility terms

For purchasing the life insurance under PMJJBY policy, you need to be an Indian resident. Also, the age range should be between 18 to 50 years. Also, you need to own a savings account and buy the policy through the banks who are participants of the scheme. Many public and some private sector banks are participants of the plan. You must link your Aadhaar with the bank account for availing the same. You may need to submit a self-attested medical certificate showing you are not suffering from any existing medical conditions for being eligible for the scheme.

Entering and exiting the scheme

If the eligibility matches, you can visit the nearest bank branch, fill the form thoroughly, and buy the policy. The insurance amount remains the same every year and can assign auto-debit facility from your savings account for paying the insurance amount against the policy. If you are unable to renew the scheme within the desired period, the insurance gets cancelled. However, you can renew the plan anytime without facing penalties. As such, you can easily walk out of the policy at any point and re-join easily in the future.

Tax benefits

The best part about PMJJBY is you are eligible for some tax benefits for investing in this unique scheme. Under Section 80C, you can avail of tax deductions up to INR 1.5 lakh on all kinds of investments. Considering this scheme is an investment scheme as well, you can avail of all the exemptions. For the same, you need to submit duly filled Form 15G or 15H. If you cannot submit the form, then you pay 2 per cent tax on life insurance proceeds which exceeds the amount of INR 1 lakh.

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