Irdai relaxes capital requirement to encourage more insurers to participate in PMJJBY

In order to give relief to insurance companies under Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), the insurance regulator IRDAI on Friday reduced the capital requirement for companies selling PMJJBY by 50%.

After this move, life insurance companies will be able to offer more policies.

According to Irdai, this step will allow life insurers to provide more policies under the scheme and bring financial security to the bottom of the Indian population through life insurance, said PTI.

Irdai's relaxation of capital requirements will hasten the penetration of life insurance in India and will support the life insurers in achieving the target set by the government.

According to PTI, this step by Irdai will supplement the recent revision of premium rates by the Government of India for the two flagship schemes - PMJJBY and Pradhan Mantri Suraksha Bima Yojana (PMSBY) to make these schemes economically viable.

Recently, after 7 years, the premium rate of Pradhan Mantri Jeevan Jyoti Bima Yojana has been increased to Rs 1.25 per day, which will increase from Rs 330 annually to Rs 436, in addition, the annual premium for Pradhan Mantri Suraksha Bima Yojana has been increased from Rs 12 to Rs. 20 has been made. These new premium rates have come into effect from June 1, 2022.

As of March 31, 2022, there were 6.4 crore active customers enrolled in the PMJJBY, said PTI.

According to PTI, as of March 31, 2022, the implementing insurers had collected Rs 9,737 crore in premiums, and claims totaling Rs 14,144 crore had been paid under the PMJJBY.

People between the ages of 18 and 50 who have a bank or post office account and give their approval to join or enable auto-debit of premiums are eligible for a life insurance cover of Rs 2 lakh in the event of death owing to any cause.