Data shows that only a small portion of beneficiaries of accident insurance cover under the Pradhan Mantri Jan-Dhan Yojana (PMJDY) have claimed since the scheme was launched a decade ago.
According to Finance Ministry data, only 12,539 claims have been received since April 1, 2014. Notably, the total number of RuPay debit cards issued to beneficiaries till December 6, 2023 is 34.71 crore.
According to the data, a total of Rs 93.5 crore has been disbursed under PMJDY, which provides RuPay debit cards with an inbuilt accident insurance cover of Rs 2 lakh to account holders.
“The benefit of insurance will be available to those cardholders who have made minimum one successful financial or non-financial transaction using RuPay Debit Card on any channel (ATM/Micro ATM/e-commerce/POS etc.) within 90%. “The date of the accident including the days preceding it,” Finance Minister Nirmala Sitharaman said in a written reply in the Lok Sabha on December 18.
The minister further said that a total of 8,199 claims have been paid out of 12,539 claims between April 1, 2014, and December 7, 2023.
Subhash Chandra Khuntia, former chairman of the Insurance Regulatory and Development Authority of India (IRDAI), told Moneycontrol that the main reason for this was people not being aware that they had insurance coverage.
“There is a lack of awareness about PMJDY RuPay Debit Card, which needs to be improved. Also, since it is an accident cover, one needs to prove it was an accident, hence the definition of an accident needs to be proved. So, there is a bit of a rigorous process in making a claim,” he said.
This data is relevant in the context of the increasing number of road accidents in India during this period. According to data reported by the Ministry of Road Transport and Highways (MoRTH), a total of 4,61,312 accidents were recorded in the country during 2022, of which 1,51,997 (32.9 per cent) occurred on national highways, including expressways. 1,06,682 (23.1 per cent) on state highways and the remaining 2,02,633 (43.9 per cent) on other roads.
“If we compare the total number of accidents that occur every year in India, the number of claims is very less, mainly due to lack of awareness,” he said.
According to government data presented in Parliament, there were 4,12,432 road accidents in India in 2021 and 3,72,181 in 2020. Khuntia said, “I would also say that this is a very good scheme and can help account holders in many ways; Therefore, banks should take initiative to create more awareness on this.”
In a written reply in the Lok Sabha, Union Road Transport and Highways Minister Nitin Gadkari said there were 1,68,491 deaths in road accidents in India last year. The number of road accident deaths in 2021 was 1,53,972, while in Covid-hit 2020 it was 1,38,383.
“People are not aware so claims are not filed. Once you are using a debit card, you just think that it is a debit card. There needs to be more advertising about this and the process should be explained to people in simple language. There is a need for more financial and digital literacy, said Chandan Sinha, former executive director of RBI.
All India Bank Officers Confederation (AIBOC) general secretary Rupam Roy said the government should advertise the benefits more aggressively.
Former RBI deputy governor R Gandhi agreed that low awareness about insurance could be one of the major factors.
Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched in August 2014 with the aim of providing universal banking services to every unbanked household. The Finance Ministry, through a release on August 28, said that more than 51.09 crore accounts have been opened under the PM Jan Dhan Yojana in the last nine years and deposits have crossed Rs 2.03 lakh crore, as the scheme has witnessed successful implementation. Have completed nine years. The year is over. ,
On August 28, 2023, Finance Minister Nirmala Sitharaman said, “Nine years of PMJDY-led interventions and digital transformation have revolutionized financial inclusion in India. It is heartening to note that more than 50 crore people have been brought into the formal banking system by opening Jan Dhan accounts.
“Of these accounts, about 55.5 per cent of the accounts belong to women, and 67 per cent of the accounts are opened in rural/semi-urban areas. The cumulative deposits in these accounts exceed Rs 2 lakh crore. Additionally, about 34 per cent of these RuPay cards are issued without any charges, which also provide an accident insurance cover of Rs 2 lakh,” she said.
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