India, a nation characterized by vast socio-economic diversity, has consistently faced the challenge of extending a robust social security net to its entire populace. A significant proportion of its population remains vulnerable to economic shocks arising from health emergencies, loss of livelihood, or unfortunate demise of the primary earner. In recognition of these pervasive risks, the Indian government has initiated numerous socially oriented insurance schemes, designed to provide a financial safety net and reduce the burden of catastrophic events on households, particularly those belonging to the economically weaker sections. These initiatives underscore a commitment to inclusive growth and the establishment of a welfare state, aiming to alleviate poverty and enhance the overall quality of life by mitigating financial anxieties associated with unforeseen circumstances.
These government-sponsored insurance programs are critical pillars of India’s social welfare architecture, moving beyond traditional subsidies to empower citizens with security and access to essential services. By leveraging public-private partnerships and innovative delivery mechanisms, these schemes seek to overcome barriers of awareness, access, and affordability that often exclude the most vulnerable from formal financial protection. The objective extends beyond mere financial payouts; it encompasses fostering financial inclusion, promoting preventive healthcare, and building resilience within communities, thereby contributing significantly to human development indicators across the country.
Pradhan Mantri Jan Arogya Yojana (PMJAY)
The Pradhan Mantri Jan Arogya Yojana (PMJAY), launched in September 2018 under the overarching umbrella of Ayushman Bharat, stands as the world’s largest government-funded health insurance scheme. It represents a monumental step towards achieving Universal Health Coverage (UHC) in India, particularly targeting the poorest and most vulnerable sections of society. The scheme aims to provide cashless access to healthcare services for secondary and tertiary care at empanelled public and private hospitals, thereby reducing the burden of out-of-pocket expenditure (OOPE) that often pushes families into poverty.
Salient Features of PMJAY
PMJAY is meticulously designed with several key features to ensure comprehensive coverage and accessibility. The scheme primarily targets over 10.74 crore poor and vulnerable families (approximately 50 crore beneficiaries) based on the deprivation and occupational criteria of the Socio-Economic Caste Census (SECC) 2011 data, in both rural and urban areas. This robust identification mechanism ensures that the benefits reach the intended beneficiaries. Each eligible family receives a health cover of up to INR 5 lakhs per family per year for secondary and tertiary hospitalization. This substantial coverage is designed to protect families from catastrophic health expenditures, which are a major cause of impoverishment in India. The benefit cover is portable across the country, meaning a beneficiary can avail cashless treatment at any empanelled hospital, public or private, across India, regardless of their state of residence or where their Ayushman Card was issued. This national portability greatly enhances access to quality healthcare.
The scheme covers a wide array of medical and surgical packages, including pre-hospitalization expenses (up to 3 days), hospitalization expenses, and post-hospitalization expenses (up to 15 days). This comprehensive coverage encompasses various services such as diagnostic tests, medicines, doctor consultations, room charges, and even transportation allowance. The entire process, from beneficiary identification to treatment and claim settlement, is designed to be cashless and paperless. Beneficiaries only need to present their Ayushman Card at an empanelled hospital, and the cost of treatment is directly borne by the scheme, eliminating the need for beneficiaries to pay upfront or file for reimbursement. The National Health Authority (NHA) is the apex body responsible for the implementation of PMJAY. It is responsible for developing policies, guidelines, and an robust IT infrastructure, which includes the Transaction Management System (TMS) and Beneficiary Identification System (BIS), to ensure seamless operation of the scheme. The funding for PMJAY is shared between the Central and State Governments, with the central government contributing 60% for most states, 90% for North-Eastern States and Himalayan States, and 100% for Union Territories without a legislature. This collaborative funding model ensures shared responsibility and commitment.
Performance of PMJAY in the Past 2 Years (Approx. 2022-2024)
In the past two years, PMJAY has continued to expand its reach and deepen its impact, demonstrating significant progress in its mission to provide affordable healthcare. The generation of Ayushman Cards, which are essential for availing benefits, has seen a substantial increase. As of May 2024, the number of Ayushman Cards generated has crossed 30 crore, with a notable acceleration in the last couple of years. This surge in card issuance indicates growing awareness and access to the scheme among eligible beneficiaries. The number of hospital admissions under PMJAY has also seen consistent growth. By early 2024, over 6.5 crore hospital admissions had been authorized, amounting to a cumulative expenditure of over INR 84,900 crore. This substantial financial outlay underscores the scheme’s role in mitigating the financial burden of healthcare for millions of families. The average daily hospital admissions under PMJAY now hover around 1.3 lakh, reflecting the scheme’s active utilization.
The network of empanelled hospitals has also expanded significantly, with over 28,000 hospitals, including public and private facilities, now part of the Ayushman Bharat network. This expansion has improved geographical access to healthcare services, particularly in remote and underserved areas. Efforts have been made to integrate digital health initiatives, most notably the Ayushman Bharat Digital Mission (ABDM), with PMJAY. This integration aims to create digital health records for beneficiaries, streamline the treatment process, and enhance efficiency through paperless and cashless transactions. Specific campaigns, such as the “Ayushman Bhava” campaign launched in 2023, have been instrumental in saturation coverage of health services, including PMJAY card generation, aiming to make every village and town ‘Ayushman’.
Despite these achievements, challenges persist. Ensuring equitable access across all regions remains a focus, as some states have shown higher rates of utilization than others. Capacity building in healthcare infrastructure, especially in public hospitals, is an ongoing need to cope with the increased demand. The scheme also faces the challenge of preventing fraudulent practices, for which the NHA has implemented stringent monitoring and auditing mechanisms, leveraging artificial intelligence and machine learning to detect anomalies. Furthermore, continuous efforts are required to improve awareness among the eligible population, particularly in remote areas, and to address issues related to the availability of specialized medical professionals in tier-2 and tier-3 cities.
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)
The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), launched in May 2015, is a crucial component of India’s broader social security architecture, specifically designed to provide affordable life insurance coverage to its citizens. It aims to offer financial protection to the families of policyholders in the unfortunate event of the insured’s death, thereby providing a much-needed safety net against unforeseen circumstances. The scheme is a testament to the government’s commitment to financial inclusion, making basic life insurance accessible even to the economically disadvantaged segments of society.
Salient Features of PMJJBY
PMJJBY is an annually renewable term life insurance scheme. Its primary objective is to provide a life cover of INR 2 lakh in case of death of the insured due to any cause. This universal coverage, irrespective of the cause of death, simplifies the benefit structure and enhances its appeal. The eligibility criteria are straightforward: any individual holding a bank account and aged between 18 and 50 years can enroll in the scheme. This broad eligibility ensures that a vast segment of the working population is covered. The premium for PMJJBY is remarkably low at INR 436 per annum (revised from INR 330 in June 2022). This premium is auto-debited from the policyholder’s bank account, ensuring convenience and minimizing defaults. The scheme is offered by Life Insurance Corporation of India (LIC) and other private life insurance companies that have tied up with banks for implementation. Banks act as master policyholders and facilitate the enrollment and premium collection processes.
The coverage period for PMJJBY is one year, from June 1st to May 31st of the next year, with annual auto-renewal. Subscribers opting for the scheme are required to give their consent for auto-debit of premium from their bank account. In case of the insured’s death, the nominee receives the sum assured of INR 2 lakh. The claim process is designed to be as simple as possible, with the nominee approaching the bank where the insured had an account and submitting the necessary documents, including the death certificate. The scheme provides a much-needed sense of security to families, particularly those where the primary earner’s demise could lead to severe financial distress. It promotes a culture of financial planning and risk mitigation among the masses, contributing significantly to deepening financial inclusion across the country.
Performance of PMJJBY in the Past 2 Years (Approx. 2022-2024)
In the past two years, PMJJBY has demonstrated robust performance in terms of enrollment and claim settlement, solidifying its position as a cornerstone of India’s social security framework. As of April 2024, the cumulative enrollments under PMJJBY have surpassed 18 crore, with a significant portion of this growth occurring within the last 24 months. This consistent uptake reflects increasing awareness and acceptance of the scheme among the eligible population. The total number of claims settled under PMJJBY has also seen a substantial rise, with over 9.5 lakh claims settled, amounting to a cumulative payout of more than INR 19,000 crore as of early 2024. The average claim settlement ratio for the scheme has remained high, indicating effective and timely disbursal of benefits to beneficiaries, which is crucial for building trust in such social insurance programs.
The increase in premium from INR 330 to INR 436 per annum in June 2022 was a significant development, aimed at making the scheme more sustainable for insurers given the escalating claim ratios. Despite this premium revision, the enrollment numbers have largely continued their upward trajectory, albeit with some minor fluctuations, suggesting that the scheme remains highly affordable and valuable to its target beneficiaries. The focus during this period has been on achieving saturation coverage, particularly in rural and semi-urban areas, through various awareness campaigns and financial literacy drives conducted by banks and insurance companies. Efforts have also been made to simplify the enrollment process further and ensure seamless auto-debit of premiums, reducing instances of policy lapse.
However, PMJJBY faces persistent challenges. While new enrollments are strong, ensuring continuous annual renewal remains a critical task. Many policyholders tend to drop out after the initial year, often due to a lack of awareness about the auto-renewal process or changes in bank account status. The relatively low premium, while a strength, also poses questions about the long-term sustainability of the scheme for insurers, especially if the claims ratio continues to rise. There is also a need for enhanced financial literacy to help beneficiaries understand the nuances of the scheme, including the importance of nomination and the claim settlement process. Despite these challenges, PMJJBY has been instrumental in providing essential life cover to millions of Indian households, preventing many families from falling into economic distress following the untimely death of a family member.
India’s journey towards comprehensive social security is significantly bolstered by government-sponsored insurance schemes like the Pradhan Mantri Jan Arogya Yojana (PMJAY) and the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY). These initiatives represent a paradigm shift in welfare delivery, moving from fragmented, ad-hoc support to structured, rights-based entitlements. PMJAY has undeniably transformed healthcare access for millions of vulnerable families, shielding them from the crushing financial burden of medical emergencies, which were historically a leading cause of poverty. Its robust IT backbone, cashless treatment model, and expansive hospital network underscore a commitment to delivering healthcare at scale and with efficiency.
Similarly, PMJJBY has made basic life insurance remarkably accessible, extending a crucial safety net to the families of deceased policyholders, often those who would have otherwise been completely unprotected. The simplicity of its structure, coupled with its highly affordable premium and auto-debit mechanism, has facilitated widespread enrollment and fostered a nascent culture of financial prudence among the masses. Both schemes, while addressing distinct aspects of social security – health and life protection – collectively contribute to building resilience within vulnerable households and reducing their susceptibility to unforeseen financial shocks.
The performance of both PMJAY and PMJJBY over the past two years highlights their immense impact and scalability, evidenced by the accelerating pace of Ayushman Card generation, increasing hospital admissions, and a growing number of settled claims under PMJAY, alongside impressive enrollment and claim settlement figures for PMJJBY. These schemes have not only provided tangible financial benefits but have also contributed to greater financial inclusion and improved health outcomes. While challenges such as sustained awareness, ensuring equitable access, enhancing infrastructure, and maintaining financial sustainability persist, the progress achieved reflects the government’s sustained commitment to expanding the social security net and realizing the vision of a more equitable and secure society for all its citizens.