Aam Aadmi Bima Yojana: Benefits, Objectives, Eligibility Criteria & more

Aam Aadmi Bima Yojana: Benefits, Objectives, Eligibility Criteria & more

Deepshikha | Jun 5, 2022 |

Aam Aadmi Bima Yojana: Benefits, Objectives, Eligibility Criteria & more

Aam Aadmi Bima Yojana: Benefits, Objectives, Eligibility Criteria & More

The Aam Aadmi Bima Yojana, a Social Security Scheme for citizens living in 48 specified vocational/ occupational groups/rural areas with landless households, was launched by the Government of India and is well-managed. On the 2nd of October, 2007, this group insurance system was implemented. The Life Insurance Corporation of India is also in charge of its administration (LIC). The Aam Aadmi Bima Yojana provides insurance coverage to a family’s sole earner or the family’s head.

The Ministry of Finance proposed merging both the Aam Aadmi Bima Yojana (AABY) and Janashree Bima Yojana (JBY) Social Security Schemes under the supervision of the Government of India (JBY). Following the merger, the scheme was renamed ‘Aam Aadmi Bima Yojana’ on January 1, 2013.

Benefits of Aam Aadmi Bima Yojana (AABY)

The Aam Aadmi Bima Yojana (AABY) provides several advantages. Below is a list of them:

  • In the event of the insured’s natural death, the policy pays a death benefit of Rs.30,000 to the policyholder’s surviving beneficiaries or family members.
  • If the insured dies or becomes permanently disabled as a result of an accident resulting in the loss of both eyes or both limbs, or the loss of one eye and one limb, the policy pays Rs.75,000 to the policyholder’s remaining beneficiaries or family members.
  • If the insured suffers a partial permanent handicap as a result of an accident that results in the loss of one eye or limb, the policy pays Rs.37,500 to the policyholder’s remaining beneficiaries or family members.
  • Scholarship benefits are also available as a Free Add-on benefit under the Aam Aadmi Bima Yojana. This benefit is available to a maximum of two children of the policyholder’s nominee or beneficiaries who are in grades 9 through 12. A monthly cost of Rs.100 is charged for each child.

Objectives of Aam Admi Bima Yojana

  • Provide rural residents with social security and financial assistance.
  • Provide social security to people living below the poverty line/people living in rural areas without any access to urban healthcare.

Exclusions Under Aam Aadmi Bima Yojana

  • Self-inflicted injuries arising out of insanity or mental illness.
  • Suicide/attempted suicide.
  • Childbirth/Pregnancy.
  • Medical expenses incurred following an accident.
  • Death or disability due to war/war-like activities.
  • Death or disability due to chemical/biological//radioactive weapons.
  • Participation in extreme sports.
  • Death or disability due to breach of law/criminal intent.

Eligibility Criteria for Aam Aadmi Bima Yojana (AABY)

  • A person aged between 18 to 59 years can avail of this insurance facility.
  • Available only to the head of the family or the earning member of the family below the poverty line in the rural areas with landless households.
  • Documentation requirements should be fulfilled.

Documentation for AABY Scheme

There is certain documentation that is required to be eligible for the Aam Aadmi Bima Yojana (AABY). They are mentioned below:

  • Name in the Voter’s List
  • Ration Card
  • Aadhaar Card (Unique Identification Card)
  • Extract from the school and birth certificate
  • Any identity card issued by the Government of India or any reputed employer

Aam Aadmi Bima Yojana Premiums

The annual premium for a 30,000-dollar policy is $200 per person. The social security fund contributes 50% of the cost of the coverage. The remaining 50% is funded by the State Government/Union Territory in the case of Rural Landless Households. The remaining 50% premium shall be borne by the Nodal Agency and/or Member and/or State Government/Union Territory in the event of other occupational groups.

Claim Procedure Under Aam Aadmi Bima Yojana (AABY)

Claim Procedure in case of death

  • In the event of the insured’s death during the policy period, the nominee must apply.
  • Along with the application for claim settlement, the Nodal Agency will ask the nominee for the insured’s death certificate.
  • The allegation will be verified by the officer designated by the Nodal Agency.
  • A supplementary certificate stating that the head of the family/earning member is below the poverty line should be presented by the office allocated by the Nodal Agency together with the deceased’s death certificate.
  • The claim would be settled after document verification.

Claim Procedure in case of Accidental death

Along with the death certificate, the below documents also need to be submitted in case the insured meets with an accidental death:

  • Policy Inquiry Report
  • Post Mortem Report
  • FIR Copy
  • Police Final Report

Claim Procedure in case of Scholarship

  • Every six months, a kid of an Aam Aadmi Bima Yojana (AABY) participant must fill out an application form. The Nodal Agency must receive the same information.
  • The Nodal Agency is responsible for verifying and identifying the child.
  • The Nodal Agency must send a list of students who have qualified for the Scholarship, together with the student’s name, class, and school. In addition, information such as the Member’s name, Master policy number, Membership number, and NEFT information for direct payment must be provided.
  • The Life Insurance Corporation of India credits the scholarship payments to the beneficiary’s account for the beneficiary child via NEFT or bank account transfer every six months on July 1st and January 1st.

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