Finance minister Nirmala Sitharaman on June 5 directed insurance companies to process claims under Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) in seven days.
Till now, insurers had 30 days' time to process these claims. The finance minister also said that there should be end-to-end digitisation of the claim settlement process between banks and insurance companies.
Chairing a virtual meeting on enhancing the speed of sanctioning of claims under PMJJBY and PM Suraksha Bima Yojana (PMSBY), the finance minister said that that there should be a process for claim documents transmission via email and digital modes like mobile application, eliminating the delay due to paper transmission.
Here, public sector insurance companies have been asked to implement an API-based mobile application for claim transmission by June 2021.
Launched in May 2015, the PMJJBY and PMSBY are part of the Jan Suraksha Yojana scheme of the PM Modi-led government.
Here, PMJJBY is a pure term insurance policy, with an annual premium of Rs 330 for a cover of Rs 2 lakh. On the other hand, PMSBY is an Rs 2 lakh cover accident insurance policy with annual premium of Rs 12.
"Attending doctor’s certificate & certificate issued by DM/authorized officer, in lieu of death certificate has to be considered for claims," she added.
There will be simplified forms and claims process issued shortly. At present, banks issue the policies to their account holders and there is an annual auto-debit of the premium from the bank account.
Sitharaman said that under PMJJBY, a total of 4,65,000 claims have been paid of value Rs. 9,307 crore. Since the beginning of the pandemic i.e., April 1, 2020 onwards till date, 1,20,000 claims have been paid amounting to Rs. 2,403 crore, at a disposal rate of 99 percent.
"Insurance company officials should continue being sympathetic while providing services to nominees of deceased policy holders, especially during pandemic period," she added.
When it comes to PMSBY, the minister said that a total of 82,660 claims have been paid of value Rs 1,629 crore as on May 31, 2021.
The enrollment under the PMJJBY stands at 103 million subscribers and under PMSBY at 234 million subscribers. The meeting on Saturday was to further ease and speed up the claims processes for these schemes.
"These claim amounts provide much-needed financial relief to nominees who have lost near and dear ones, and the government’s steps will enhance the ease and speediness of this process," said Sitharaman.
Garib Kalyan health insurance
During the meeting, the FM also reviewed the progress made under the Pradhan Mantri Garib Kalyan Package (PMGKP) Insurance Scheme for Health Workers Fighting COVID-19.
Here, data showed that a total of 419 claims have been paid as on date, amounting to Rs 209.5 crore disbursed in the account of their nominees.
To address the issue of delays arising out of states sending documents, Sitharaman said that a new system has been put in place whereby a simple certificate from the District Magistrate (DM) and endorsed by the nodal state health authority will be sufficient to process these claims.
New India Assurance is the company managing the PMGKY insurance and the finance minister cited the example of Ladakh where a claim was settled within four hours of receiving the DM certificate and urged to maintain a similar approach in future.
The finance minister also directed the states to take up COVID-19 claims of health workers on priority and make maximum use of this simplified mechanism that has been put in place.
These claim amounts provide much-needed financial relief to nominees who have lost near and dear ones, and the government’s steps will enhance the ease and speediness of this process.
Moneycontrol had reported earlier that Finance Minister Nirmala Sitharaman has asked the Insurance Regulatory and Development Authority of India (IRDAI) to direct companies to prioritise COVID-19 claims.
Also Read: Claims paid under PMJJBY zoom
Sitharaman had also said that reports are being received about some hospitals denying cashless insurance.Following this, IRDAI sent a circular to insurance companies asking them to expedite the settlement of COVID-19 claims. Insurers are currently in the midst of redrafting their service level agreements with the hospitals. Errant hospitals could even be dropped from the cashless network.