Top 9 Government-Backed Insurance Plans in India

With today's fast-paced lifestyle, the number of health related threats is constantly increasing. The unfortunate and untimely demise of the earning member of the family can put the family in emotional and financial stress. On the other hand, the cost of medical treatment can burn a massive hole in your pocket and can exceed your savings. Besides, nobody wants to borrow funds or take help from friends or relatives to cover the medical expenses or support the family. Therefore, securing yourself and your family with the right health insurance and life insurance policy is crucial. However, the cost of insurance might not be affordable to everyone. Hence, to ensure citizens from all the sections of the country get benefited from insurance, the Government of India has introduced different life and health insurance plans.

Here are the top 9 government-backed insurance plans:

1. Rashtriya Swasthiya Bima Yojana

2. Central Government Health Scheme

3. Aam Aadmi Bima Yojana

4. Ayushman Bharat - National Health Protection Mission

5. Universal Health Insurance Scheme

6. Pradhan Mantri Suraksha Bima Yojana

7. Employment State Insurance Scheme

8. Janashree Bima Yojana

9. Mahatma Jyotiba Phule Jan Arogya Yojana

Let's have a detailed understanding of these schemes:

1. Rashtriya Swasthiya Bima Yojana (RSBY):

93% of the total workforce in the country currently works in the unorganised sector. The majority of them still do not have any social security coverage. These workers and their families frequently face illnesses that need medical assistance and hospitalisation. In 2018, The Ministry of Labour and Employment, Government of India launched the scheme called 'Rashtriya Swasthiya Bima Yojana' to offer health insurance schemes to the below poverty line workers that work in the unorganised sector. The scheme is well-designed and eliminates the pitfalls of the previous government health insurance schemes that could not achieve their objectives. You can buy the health insurance cover for yourself, your spouse, and up to three dependents. The beneficiary is entitled to hospitalisation expenses up to Rs 30,000 due to an illness. The scheme covers the pre-existing ailments from the start of the policy, and there is no age limit to buy the scheme. You only have to pay the registration fee of Rs 30, whereas the state and the central government will pay the premium.

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2. Central Government Health Scheme (CGHS):

The Central Government Health Scheme was started with the objective of providing comprehensive medical care to the central government employees. The scheme covers both serving and pensioners and their dependent family members. It also provides service to the members and former members of parliament, judges of Supreme and High Court, freedom fighters, former Governors, and former Vice-Presidents of India.

The scheme provides coverage towards hospitalisation, domiciliary services, maternity, family welfare, dispensary care, consultation with the specialist, and medical tests like x-ray, ECG, laboratory tests, etc. It also extends its coverage to the AAYUSH treatments. The AAYUSH treatments include Allopathic, Ayurveda, Yoga, Unani, Siddha, and Homeopathic treatments.

3. Aam Aadmi Bima Yojana (AABY):

Aam Aadmi Bima Yojana was launched in October 2007 to provide health insurance cover to the citizens living in the upcountry and in the rural areas. The scheme also covers landless citizens living as tenants in urban and rural areas. It covers individuals from the age group of 18 to 59 years. The scheme basically protects the head of the family or the earning member of the family. The State and Central Government equally share the annual premium of Rs 200. The family is compensated with Rs 30,000 upon a natural death of the policyholder and Rs 75,000 upon death caused by accident. The scheme compensates with Rs 75,000 upon total partial or permanent disabilities, which covers loss of two limbs or two eyes, and Rs 37,500 upon partial permanent disabilities, which covers loss of one limb or one eye.

4. Ayushman Bharat - National Health Protection Mission (AB-NHPM):

Ayushman Bharat - National Health Protection Mission is a health insurance scheme that covers over 10 crore poor and vulnerable families, the scheme is expected to have approximately 50 crore beneficiaries. AB-NHPM provides coverage up to Rs 5 Lakhs per family per year for secondary and tertiary care hospitalisation. It subsumes the two centrally sponsored schemes - Rashtriya Swasthya Bima Yojana (RSBY) and the Senior Citizen Health Insurance Scheme (SCHIS).

The beneficiaries can take the cashless benefit from the public and empanelled private hospitals across the country. However, to implement the scheme, the state is required to have the State Health Agency (SHA).

5. Universal Health Insurance Scheme (UHIS):

The Universal Health Insurance Scheme was launched in 2003 by four public insurance companies. The scheme's primary objective is to provide health care to the poorest section of society. The scheme is open to the below poverty line families and offers medical cover to the entire family. In case of the hospitalisation of a family member, the scheme facilitates medical expenses of up to Rs 30,000. In case of the hospitalisation of the earning member or head of the family, the scheme compensates a total of Rs 50 daily for a maximum of 15 days. It also offers accidental health insurance cover of Rs 25,000 to the family members. The premium for UHIS for an individual policyholder is Rs 200, whereas Rs 300 for a family of up to 5 members, and Rs 400 for a family of up to 7 members.

6. Pradhan Mantri Suraksha Bima Yojana (PMSBY):

Pradhan Mantri Suraksha Bima Yojana is a government-backed accidental insurance scheme. It provides coverage up to Rs 2 Lakhs for accidental death and Rs 1 Lakh for partial disability. The premium of Rs. 12 per annum is to be deducted from the account holder's bank account through the 'auto-debit' facility in one instalment. The scheme is being offered by Public Sector General Insurance Companies or any other General Insurance Company who are willing to offer the product on similar terms with necessary approvals. The people in the age group 18 to 70 years are eligible for the scheme.

7. Employment State Insurance Scheme (ESIS):

The Employment State Insurance Scheme was designed to accomplish the task of protecting employees as stated in the Employees' State Insurance Act, 1948. It covers incidences of sickness, maternity, disablement, and death due to employment injury and provides medical care to insured persons and their families. The employees of factories and other establishments like road transport, hotels, restaurants, cinemas, newspapers, shops, educational and medical institutions, etc., where 10 or more persons are employed, can benefit from the scheme. The limit on the minimum number of employees may vary from state to state. The scheme provides cash benefits, dependent benefits, monthly pension, etc. to the policyholders.

8. Janashree Bima Yojana (JBY):

The Central Government and Life Insurance Corporation jointly launched Janashree Bima Yojana in 2000. It has replaced Social Security Group Insurance Scheme (SSGIS) and Rural Group Life Insurance Scheme (RGLIS). The scheme provides life insurance coverage to rural and urban citizens below and marginally above the poverty line. An individual between the age group of 18 to 59 years, who is a member of any of the nodal agency (Self Help Groups, NGOs, Panchayat, or any other institutional arrangement) approved occupation or vocational group can benefit from the scheme. The premium to be paid for the scheme is Rs.200/- per member. 50% of which will be paid by the State Government/Nodal Agency members, and the other 50% will be borne from the Social Security Fund. On the natural death of the policyholder, a compensation of Rs 30,000 is provided to the family. On death or total/permanent disability due to an accident, Rs 75,000, and a partial disability due to an accident, Rs 37,500 is compensated.

The scheme provides special assistance to women SHG members for the education of their children. Under Shikha Sanyogita Yojana, a scholarship amount of Rs 600 is paid every 6 months to students studying in IX to XII (including students perusing ITI). However, a maximum of only 2 children can take the benefit from the scholarship. The scheme also offers a term plan with a coverage of Rs 30,000 on a premium of Rs 200 per annum, out of which 50% is shared with the LIC, and the remaining 50% is paid by SHG members.

9. Mahatma Jyotiba Phule Jan Arogya Yojana (MJPJAY):

The Government of Maharashtra introduced Mahatma Jyotiba Phule Jan Arogya Yojana, a health insurance policy that targets the farmers in Maharashtra. It offers a health insurance cover to the family of the farmer up to Rs 1.5 Lakh for specified illnesses.

The Government of Maharashtra introduced this health insurance policy for the benefit of people in the state. The scheme is going to be helpful for those below the poverty line and was targeted at the farmers in Maharashtra. The MJPJAY does not have a waiting period, so the policyholders can claim and benefit from the policy from day one unless the waiting period for the illness is specifically mentioned in the policy.

To Conclude:

To ensure that each section of the society is covered with life insurance and health insurance, the Government of India has launched and successfully operating several insurance schemes. The government-backed health insurance and life insurance plans are often targeted at the low-income group. These policies ensure better coverage to poor people at an affordable premium. However, many needy people still do not get benefited from these schemes due to the unawareness and lack of guidance. So it is our duty to educate the needy individuals around us, like our house help, watchman, etc., and make sure they get benefited from it.

Warm Regards,
Ketki Jadhav
Content Writer