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Dvara Analysis Weblog | Challenges within the supply of Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY)[1]


Niyati Agrawal
Misha Sharma[2]

1. Introduction

Life insurance coverage can function a crucial product within the portfolio of low-income households (LIHs) to tide over adversarial earnings shocks. Occasions similar to lack of life or accident of the first earnings earner of the household, mixed with insufficiency and unpredictability in cashflows can have an enormous destructive affect on the monetary stability of those households. Subsequently, serving to low-income households handle and get well from shocks is a vital coverage mandate. With this agenda in thoughts, the Authorities of India launched the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY) in Could 2015 as a part of the Jan-Dhan Se Jan Suraksha program. PMJJBY gives a sponsored life insurance coverage cowl of as much as ₹2 lakhs for a premium of ₹436 (paid yearly) for people within the age group of 18 to 50 years.[3] PMSBY gives unintentional demise and incapacity protection of as much as ₹2 lakhs for unintentional demise and full incapacity and ₹1 lakh for partial incapacity for a premium of ₹20 each year, for people within the age group of 18 to 70 years.[4] PMJJBY and PMSBY are provided by Life Insurance coverage Company and public sector common insurance coverage firms, respectively, together with different insurance coverage firms keen to offer the merchandise on phrases mandated by the Authorities, with needed approvals and tie-ups with banks (Inclusive Finance Report, 2021).[5]

The reasonably priced and accessible nature of those insurance coverage merchandise makes them related to the wants of low-income households. But, the take-up of those schemes stays low. In response to the 2019 All-India Debt and Funding Survey (AIDIS),[6] lower than 5% of Indian households have PMJJBY and PMSBY accounts, with the possession being lower than 1% for low-income households.[7]

This analysis transient goals to synthesize current proof on the efficiency of PMJJBY and PMSBY since their inception, the explanations for low participation in these schemes, and the boundaries to their profitable implementation. We do that by specializing in the supply-side points that give rise to buyer safety issues and that cut back the effectiveness of those schemes. We break down and consider every step of the shopper journey- from entry and possession of accounts to claims settlement and the mechanisms accessible for grievance redress. We additionally briefly describe the demand-side components which have a bearing on the take-up of those schemes, such because the buyer’s context and preferences and attitudes in direction of insurance coverage.[8]    

We depend on current datasets to guage the penetration of those merchandise and converse to sector specialists from grassroots organisations, suppose tanks, and the monetary trade to furnish a holistic perspective on the effectiveness of those schemes in assembly their goals.

We discover that the shopper journey in buying and availing the advantages of PMJJBY and PMSBY is marred by quite a few process-level inefficiencies. These inefficiencies end in buyer harms and provides rise to varied buyer safety issues. These issues relate to practices adopted by Monetary Service Suppliers (FSPs) within the sale and servicing of those merchandise that put the shopper’s curiosity and wellbeing in danger and subsequently fail to ‘shield’ the shopper.

Click on right here to entry the complete analysis transient.

[1] We’re grateful to the Gates Basis for funding this challenge as a part of Dvara Analysis’s Buyer Safety Program (CPP). We thank the advisory committee members of CPP and specifically Pawan Bakhshi, India Nation Lead at BMGF. We thank Indradeep Ghosh, Govt Director and Deepti George, Head of Technique and Deputy Govt Director at Dvara Analysis for his or her suggestions and inputs all through the course of the research. We additionally thank Shreya Tiwari who interned with us on this challenge from April to Could 2022. Lastly, we want to thank a number of trade specialists we spoke to to be able to construct our understanding of the challenges in delivering the insurance coverage schemes below the Jan Suraksha program.

[2] Niyati Agrawal, Analysis Affiliate, Family Finance Analysis Initiative, Dvara Analysis (; Misha Sharma, Apply Head, Family Finance Analysis Initiative, Dvara Analysis (

[3] The premium quantity of PMJJBY was elevated from an annual quantity of ₹330 to ₹436 in Could 2022.

[4] The premium quantity of PMSBY was elevated from the preliminary ₹12 each year to ₹20 each year in Could 2022.

[5] Inclusive Finance India Report, 2021-

[6] Insights from the AIDIS 2019-

[7] To review the distribution of policyholders by family wealth, we additionally calculated the online price of households by estimating the distinction between their worth of property and liabilities. We discovered that 75% to 80% of PMSBY and PMJJBY account possession comes from households that fall within the high 60% of internet price distribution, whereas the underside 40% of households personal solely 20% to 25% of the entire pie. These numbers point out that the protection of those schemes stays insufficient amongst low-income households.

[8] A number of of those components are, nonetheless, intricate and are extra complicated than what they appear on the floor. Subsequently, a neat bifurcation of demand versus provide facet points may not at all times be potential. Nevertheless, you will need to focus on these components as they affect the uptake of those schemes. Furthermore, a number of of the ‘demand-side components’ are additionally a consequence of the present distribution realities of insurance coverage merchandise amongst low-income households, notably in rural settings. For instance, lack of information may very well be considered as each a provide and a requirement facet challenge. One may argue that FSPs haven’t made sufficient effort to teach and inform potential prospects, particularly amongst low-income, rural communities, about quite a lot of insurance coverage merchandise accessible available in the market. This may very well be a purpose for the dearth of demand for time period life insurance coverage merchandise amongst low-income households. On the similar time, one may additionally argue that restricted publicity to the formal monetary system and low ranges of training of LIHs hinders their data in regards to the formal insurance coverage markets at massive.

Cite this transient:


Agrawal, N., & Sharma, M. (2023). Challenges within the supply of Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY). Retrieved from Dvara Analysis.


Agrawal, Niyati and Misha Sharma. “Challenges within the supply of Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY).” 2023. Dvara Analysis.


Agrawal, Niyati, and Misha Sharma. 2023. “Challenges within the supply of Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY).” Dvara Analysis.

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