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Pradhan Mantri Suraksha Bima Yojana (… — Govt Scheme for UPSC | Vaidra
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Pradhan Mantri Suraksha Bima Yojana (PMSBY)

Ministry of FinanceactiveSocial SecurityLaunched: 2015-06-01

About the Scheme

PMSBY is an accidental insurance scheme offering ₹2 lakh for accidental death/permanent disability at just ₹20/year premium. Launched June 1, 2015. 51.06 crore cumulative enrollments (Apr 2025). ₹3,121 crore paid in claims for 1.57 lakh cases. World's largest accident insurance scheme.

Target Beneficiaries: 51.06 crore cumulative enrollments (Apr 2025); ₹3,121.02 crore paid for 1.57 lakh claims; world's largest accident insurance scheme

Official Website →

✦Key Features

  • ₹2 lakh cover for accidental death or total permanent disability; ₹1 lakh for partial permanent disability
  • Annual premium: ₹20/year only (auto-debited June 1 each year)
  • 51.06 crore cumulative enrollments (Apr 2025) — world's largest accident insurance scheme
  • ₹3,121.02 crore paid in 1.57 lakh claims by Apr 2025
  • Eligibility: 18-70 years; bank/post office account; renewed annually
  • Part of Jan Suraksha trinity with PMJJBY (life) and APY (pension)
  • No exclusion for pre-existing conditions; covers all accident types

✓Eligibility Criteria

  • Individuals between the age group of 18 years to 70 years
  • Possession of a savings bank account or a post office account is mandatory
  • Consent for auto-debit of the annual premium from the linked bank account
  • Aadhaar should be linked to the bank account to facilitate seamless claim settlement

★Benefits

  • Risk coverage of ₹2 lakh in the event of accidental death of the insured person
  • Payment of ₹2 lakh for total and irrecoverable loss of both eyes or both hands or feet
  • Coverage of ₹1 lakh for permanent partial disability such as loss of one eye or limb
  • Highly affordable annual premium of ₹20 per member for a one-year cover period

▶Application Process

  • Submit the simplified PMSBY application or consent form to the concerned bank branch
  • Activate the auto-debit facility to allow the deduction of the annual premium of ₹20
  • Receive an acknowledgement slip or policy certificate as proof of insurance coverage
  • Ensure the account is funded every year before May 31st for the next year's renewal

₹ Budget Allocation

300

Funding Ratio (Centre:State): Premium-based; self-funded by subscribers. Government handles administrative costs.

Exam Relevance

GS Paper: GS3

Prelims Relevance9%
Mains Relevance9%

Syllabus Tags

Social SecurityInsuranceFinancial InclusionJan SurakshaGS3

Historical Context

Launched in June 2015 along with PMJJBY to increase insurance penetration from the then-low level of <1%.

Exclusion Criteria

  • Individuals below 18 or above 70 years
  • Non-resident Indians (unless having a bank account in India)
  • Account holders without auto-debit consent

Challenges

  • Low awareness about the claim process among nominees
  • Delay in claim settlement due to documentation requirements
  • Involvement of multiple intermediaries leading to information asymmetry

Reforms & Recommendations

  • Digitalization of the entire claim process to ensure 'contactless' settlement
  • Mandatory insurance literacy camps at the Panchayat level
  • Integrating the scheme with the e-Shram portal for automatic mapping

Performance Statistics

Metric

51.06 Crore

Source: Ministry of Finance

Metric

₹3,120 Crore

Source: PIB

Critical Analysis

PMSBY provides a 'near-universal' accidental insurance cover at an extremely low cost (₹20/year). Its brilliance lies in the auto-debit feature, which minimizes churn and administrative costs. However, the claim settlement process is often cited as cumbersome for rural beneficiaries who may lack immediate access to FIRs or death certificates. The scheme's sustainability depends on the balance between low premiums and the increasing claim ratios faced by insurance companies.

SDG Linkages

SDG 1: No PovertySDG 3: Good Health and Well-beingSDG 10: Reduced Inequalities

Constitutional Backing

Article 38: State to secure a social order for the promotion of welfare of the peopleArticle 41: Right to public assistance in cases of sickness and disablement

Technology Used

DBT (Direct Benefit Transfer) for claimsAuto-debit through Core Banking SystemsJan Suraksha Portal

Success Stories

Safety Net during Rail Accidents

Key Takeaways

  • ₹2 Lakh for accidental death or total disability
  • ₹1 Lakh for partial disability
  • Premium: ₹20 per annum
  • Age limit: 18 to 70 years

Probable Questions

How does PMSBY contribute to the financial resilience of informal sector workers against unforeseen risks?

Medium80%

Mains Answer Fodder

PMSBY is a critical component of the Jan Suraksha Trinity (PMJDY, PMJJBY, PMSBY). It mitigates the 'vulnerability of the poor' to sudden economic shocks caused by accidents. Keywords: Micro-insurance, Jan Suraksha, Financial safety net, Auto-debit mechanism.

Convergence Schemes

  • Pradhan Mantri Jan Dhan Yojana (PMJDY)
  • Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

Sector Tags

InsuranceSocial SecurityFinancial Inclusion