Centre may double coverage under its flagship insurance schemes

livemint.com:

₹5 lakh, up from the present limit of ₹2 lakh, under Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), the people said on the condition of anonymity. It is one of the largest life insurance programmes from the government, with more than 200 million subscribers. The plan also involves increasing the cover to ₹5 lakh from the current ₹2 lakh under Pradhan Mantri Suraksha Bima Yojana (PMSBY) in case of death or disability caused by accident.

As of 31 July, enrolments under the scheme stood at 453.6 million. The push to increase coverage is part of the government’s "insurance for all by 2047" initiative. While the number of insurers rose from 53 to 70 in the past 10 years, India's insurance penetration—or percentage of premium to GDP—of 4% is still lower than the global average of 6.8%.

“The changes are being considered with a view to address the issue of protection gap in the insurance cover. Higher coverage will provide the requisite amount required by an insured or a dependent in meeting the financial obligations. The thinking is that a ₹5 lakh cover under the schemes would help to bridge this protection gap substantially," said the first of the two persons quoted above.

Queries emailed to ministry of finance and secretary, department of financial services remained unanswered till press time. The officials cited earlier said discussions have already started to raise coverage under the two schemes. Individuals will have the option to either take the higher cover on paying increased premium or continue with the existing ₹2 lakh cover—at a premium of ₹20 per annum per member of a family for PMSBY, and ₹436 per annum per member for PMJJBY.