Aam Aadmi Bima Yojana - Features and Benefits

 Introduction

Aam Aadmi Bima Yojana (AABY) is a government-funded scheme introduced to provide financial assistance to people from economically weaker sections of the society in need of medical treatment. The poor people toil day and night to earn two square meals and it’s difficult for them to save some money for any medical emergencies. AABY scheme was therefore introduced in 2007 on the occasion of Gandhi Jayanti by the government to help the people during such emergencies to compensate for the expenses incurred due to accidents or some unfortunate incident.

How Does It Work?

Aam Aadmi Bima Yojana policy is launched to help people falling under and slightly above the poverty line. Unlike any other insurance plan or policy, the AABY scheme involves an annual premium of Rs. 320. Aam Aadmi Bima Yojana policy premium is comparatively lower than any policy premium. However, to ensure that the amount of the premium does not incur any burden on the policyholder, the premium of AABY is split between the government and the policyholder.

Reasons To Buy This Plan

The Aam Aadmi policy is designed to help the poor and needy, but one has to register themselves under the AABY scheme to avail of its benefits. Some of the prime reasons for doing this are -

• Helping Hand -

During emergencies or in unfavourable scenarios, some financial assistance that does not come with an interest rate or repayment module, will prove beneficial.

• Monetary Assistance -

Aam Aadmi Yojana renders monetary support to the policyholder that can be used for various purposes apart from medical expenses and bills.

• Duty as a Citizen -

Indian Government is launching schemes and policies to uplift the weaker sections of the society. It is the duty of these citizens to avail benefits from such schemes and spread awareness among fellow citizens, especially in rural areas.

Key Features

The key features of the Aam Aadmi Bima Yojana policy are -

• Funded Premium -

AABY is a government-sponsored scheme, where 50% of the premium comes from the Social Security Fund managed by the Indian government. The remaining 50% is generally paid by the policyholder, however, it can be exempted in special cases.

• Quick Registration Process -

One can opt for Aam Aadmi Bima Yojana online registration that involves quick approval with minimal documentation. The offline process also offers a hassle-free experience, however, the approval process takes more time comparatively.

• Smooth Sail Claim Process -

To claim funds under the AABY scheme is very easy. The policyholder will have to submit some documents for verification like beneficiary card, identity proof, etc. and the process will be completed.

Benefits

Listed below are some top Aam Aadmi Bima Yojana benefits -

• Natural Death Coverage -

If the policyholder dies due to some natural reasons like heart attack or others, the family members receive compensation of Rs. 30,000 under the AABY scheme.

• Accidental Death Coverage -

If the policyholder incurs an accidental death, the family members receive compensation of Rs. 75,000 under the AABY scheme.

• Permanent Disability Coverage -

Under the AABY scheme, if a person incurs any permanent accidental disability, they receive compensation of Rs. 75,000.

• Temporary Disability Coverage -

Under the AABY scheme, if a person incurs any temporary accidental disability, they receive compensation of Rs. 37,500

• Educational Coverage -

Aam Aadmi Bima Yojana policy covers secondary and higher secondary fees of the policyholder’s two children. Apart from that, an amount of Rs. 200 will be provided to them annually for stationary expenses.

Inclusions

The Aam Aadmi Bima Yojana benefits include:

• Natural Death -

The natural death of the policyholder, allows the family members to claim compensation under the AABY scheme, however, it is mandatory to submit a death certificate for documentation purposes.

• Accidental Death -

The death of the policyholder in an accident allows the individual to avail the compensation under the scheme, however, it is mandatory to submit a death certificate for documentation purposes.

• Disability -

The partial or permanent disability caused to the policyholder in an accident, makes them eligible for compensation under the AABY scheme. The policyholder will have to submit documents for verification purposes.

Exclusions

There are some exclusions or certain aspects that are not covered under the Aam Aadmi Bima Yojana policy. These are:

• The mental health of an individual is quite subjective. The death of any policyholder caused due to mental illness is not considered for compensation.

• Suicide or self-inflicted injuries that might have caused any temporary or permanent disabilities are not considered for compensation.

• AABY scheme does not take care of hospitalisation costs and expenses

• Death or disabilities caused during the war period are not considered for compensation.

• Substance abuse or participation in any life-threatening stunts that might cause death or any sort of disability is not considered for compensation.

Claim Process

An individual can claim compensation under the AABY scheme. Once the claim is approved and comes under process, the amount will be transferred into the policyholder or nominee’s account via cheque, NEFT, etc. by LIC. There are three different claim processes for the Aam Aadmi Bima Yojana policy. These are:

Death

The claim process is the same for both, natural and accidental death coverage.

• Fill out the Aam Aadmi Bima Yojana claim form. Remember to claim before the policy expires.

• Attach mandatory documents like original death certificate, photographs, BPL card etc and submit them to the concerned officer at the Nodal Agency.

• After the documents and information are verified by the concerned officer at Nodal Agency, the claim form will be approved.

• The funds will be disbursed quickly after the approval.

Disability

The claim process is the same for permanent and temporary disability coverage.

• Fill out the Aam Aadmi Bima Yojana claim form. Remember to claim before the policy expires.

• Attach mandatory documents like FIR report, medical certificate, accident investigation report, etc. and submit them to the concerned officer at Nodal Agency.

• After the documents and information are verified by the concerned officer at Nodal Agency, the claim form will be approved.

• The funds will be disbursed quickly after the approval.

Educational Support

To claim scholarships for educational support, individuals will have to follow these simple details -

• The eligible applicant will have to fill out the scholarship form twice a year specifying details like name, school, policy number, etc.

• Attach mandatory documents like identity proof, Aam Aadmi Bima Yojana policy papers, etc., and submit them to the concerned officer at the Nodal Agency.

• After the documents and information are verified by the concerned officer at Nodal Agency, the application form will be processed for fund disbursal.

• The funds for scholarships are disbursed twice a year on 1st January and 1st July by LIC via chosen transfer mode into the bank account.

Conclusion

Aam Aadmi Bima Yojana policy is the government’s initiative to help the poor during their difficult times. The scheme has been carefully designed with proper procedure to ensure that benefits reach everyone, especially in the rural areas. For people who are ineligible for the AABY scheme, but aim for such financial security, they can browse term insurance plans available on the Finserv MARKETS app. The platform offers a wide range of term insurance policies, ULIP and endowment plans tailored according to the needs and goals of every customer.