Micro policies keep India's push for insurance coverage on track

Mumbai: India's push for universal insurance coverage by 2047 is being propelled by the rapid adoption of micro insurance policies, which are helping drive penetration, especially in underserved and low-income segments. The government's JanSuraksha schemes under the Pradhan Mantri Jan-Dhan Yojana (PMJDY) have aided in this growth and as of April 2023, 66.76% of PMJDY no-frills bank account holders had opted for accident insurance, 31% for life insurance, and 10% for micro-pensions, covering many who were previously outside the insurance safety net, a study shows.

A study conducted by the Women's World Banking, focusing on 912 rural women in Jharkhand, West Bengal, Assam, and Tamil Nadu, showed the widespread adoption of government insurance schemes. Among the findings, 68% of respondents were covered under the Pradhan Mantri Suraksha Bima Yojana (PMSBY), an accident insurance scheme, and 65% had dual coverage with PMSBY and the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), a life insurance scheme. Also, 30% had enrolled in the Pradhan Mantri Jan Arogya Yojana (PMJAY), a national public health insurance scheme.

"Success of schemes is driven by their affordability, ease of enrollment, and simplicity," report said.


The global micro-insurance industry is projected to grow to $137 billion by 2029. India's insurance penetration remains low at 4%, compared to the global average of 6.8%, but the government's efforts through Jan Dhan accounts and social security schemes have laid a strong foundation for achieving the "Insurance for All" target by 2047. As of May 2024, 523 million PMJDY accounts were opened, with 55.6% held by women.

The study showed 80% of women earning less than ₹25,000 per year were enrolled in at least one scheme. Banking agents have played a key role in the process, with 72% of women being enrolled through agents.