Finance ministry pushes PSBs to boost affordable insurance coverage
New Delhi, Jan 27, 2025
PSBs achieved only 51% of enrolment targets for the Pradhan Mantri Jeevan Jyoti Bima Yojana by Dec 2024
The Union finance ministry has asked public-sector banks (PSBs) to intensify expanding the coverage of government-backed affordable life insurance schemes under its financial-inclusion initiative, according to a senior government official.
“In financial-inclusion schemes, banks are performing well in opening accounts and other initiatives. However, insurance-related components are underperforming. As of December 2024, the enrolment targets and achievements for the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) across various banks, including sponsored Regional Rural Banks (RRBs), show that only about half the annual target has been met,” the official said.
Under the PMJJBY, the enrolment target for all banks was 40.74 million and 20.78 million were brought under it, resulting in an achievement rate of 51 per cent till December 2024, according to the government-sourced data.
The PMJJBY is a life-insurance scheme launched in 2015 for persons aged 18-50 with an individual bank or post-office account.
People who join the scheme before turning 50 can continue to have life coverage till they are 55 upon paying a premium of Rs 436 per annum for life cover of Rs 2 lakh.
State Bank of India led with an annual-target achievement of 76 per cent, while others like Indian Bank and Punjab & Sind Bank clocked 58 per cent and 56 per cent, respectively.
In contrast, Indian Overseas Bank managed only 48 per cent, and Central Bank of India 42 per cent.
Nine PSBs have achieved less than 50 per cent of their annual targets, prompting the finance ministry to ask them to enhance their efforts on this count.
However, enrolment targets and achievements for the Pradhan Mantri Suraksha Bima Yojana (PMSBY) across various banks, including sponsored Regional Rural Banks (RRBs), have been better. Till December 2024, the target for all banks was 63.4 million, but 40.7 million registered for it, resulting in an achievement rate of 64 per cent, according to sources.
SBI demonstrated strong performance, achieving 92 per cent of its target, followed by PNB (65 per cent) and Indian Bank (64 per cent).
Central Bank of India reached 59 per cent, while Canara Bank and Bank of Baroda achieved 58 per cent and 56 per cent respectively.
Launched in 2015, the PMSBY is a one-year accidental insurance scheme, renewable each year, offering coverage for death or disability for persons aged 18-70 years with an individual bank or post-office account.
“The penetration of insurance schemes is influenced by casualty rates, and a significant number of beneficiaries are Jan Dhan account holders. We’re working to build momentum. Furthermore, private companies have a rapidly growing insurance market. However, PSBs are focusing on expanding reach by raising awareness among the public,” said a public-sector banker.
Lagging behind
> PSBs achieved only 51% of enrolment targets for the Pradhan Mantri Jeevan Jyoti Bima Yojana by Dec 2024
> Enrolments for Pradhan Mantri Suraksha Bima Yojana stood at 64% of targets, with SBI leading at 92%
> Nine PSBs, including Indian Overseas Bank (48%) and Central Bank of India (42%), fell below 50% for PMJJBY target
[The Business Standard]
