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The poor and the economically weaker sections of the society seldom avail insurance coverage for themselves against deaths and disablements. However, they are prone to natural or accidental deaths and disablements and when the breadwinner of the family faces these contingencies the family suffers a financial loss. It becomes difficult for the economically weaker sections of the society to arrange for an insurance coverage because of affordability. That is why the Government of India has launched various social security schemes for the poor. These schemes aim to provide welfare benefits and the Aam Admi Bima Yojana is one such social security scheme which has been launched by the Government. Let’s understand the scheme in details –

What is the Aam Admi Bima Yojana scheme?

The Aam Admi Bima Yojana is a social security scheme which was launched on 2nd October 2007 to provide a group insurance cover to individuals belonging to specified groups. The scheme provides insurance coverage against natural and accidental deaths and disablements. On 1st January, the Aam Admi Bima Yojana scheme was merged with the Janashree Bima Yojana Scheme to provide a wider scope of coverage to eligible individuals.

Salient features of the scheme

Here are the salient features of the Aam Admi Bima Yojana scheme –

  • Natural death, accidental death, permanent partial disability suffered due to an accident and permanent total disability suffered due to an accident are covered under the scheme
  • The scheme covers the members of 48 groups which have been identified for the purpose of coverage
  • The coverage amount is fixed and the amount depends on the contingency suffered
  • The lump sum amount of coverage is paid in case of claim
  • The scheme is implemented through a nodal agency. A nodal agency can be a State Government, a Department of Central Ministry, Union Territory, an institutionalized arrangement or a registered NGO that has been appointed for implementing the scheme.
  • The scheme can be bought through the Life Insurance Corporation of India (LIC) which is the only insurance company that is offering the scheme presently.

Who can be covered under the scheme?

There are certain eligibility parameters for availing coverage under the Aam Admi Bima Yojana scheme. These parameters are as follows –

  • Only one member per family can be covered. Coverage is allowed either for the earning family member or the family head as chosen by the family being covered.
  • The age of the insured should be between 18 years and 59 years.
  • The individual should belong to a Below Poverty Line (BPL) family or a family above the poverty line belonging to the vocational group identified under the scheme or belonging to the rural landless household.
  • 48 vocational groups are identified under the scheme and the members belonging to those groups can be covered. 

The identified groups are as follows –

Beedi workersBrick kiln workersCobblersCarpenters
FishermenHandloom weaversHamalsHandicraft artisans
Handloom and Khadi weaversLeather and tannery workersLady tailorsPhysically handicapped people who are self-employed
Papad workers who are associated with SEWAPrimary milk producersAuto drivers or rickshaw pullersSlat growers
Safai karamacharisTendu leaf collectorsForest workersScheme for the urban poor
SericultureForest workersPowerloom workersToddy tappers
Women of hilly areasTextileManufacture of wood productsManufacture of leather products
Food stuffs like sugar or khandsariManufacture of paper productsRubber and coal productsPrinting
Mineral products like earthen toys manufactureChemical products like candle manufactureTransport drivers associationAgriculturists
Rural poorTransport karamacharisFirecrackers’ workersConstruction workers
Aanganwadi teachersCoconut processorsPlantation workersKotwal
Sheep breedersWomen associated with self-help groupsOverseas Indian workersUnorganized workers covered under the Rashtriya Swasthya Bima Yojana

What is the coverage under the scheme?

The Aam Admi Bima Yojana covers the following instances –

  • Natural death
  • Accidental death
  • Accidental permanent partial disability wherein the insured loses one limb or sight of one eye
  • Accidental permanent total disability wherein the insured loses both limbs or sight or both eyes or one limb and sight of one eye.

Besides these inbuilt coverage benefits, a free additional coverage benefit is also provided which is called Scholarship Benefit and is available for up to two children of the insured member. The children should be studying in Classes 9th to 12th.

The coverage amount for each coverage benefit is as follows –

Contingency sufferedSum insured payable
Natural deathINR 30,000
Accidental deathINR 75,000
Accidental permanent total disabilityINR 75,000
Accidental permanent partial disabilityINR 37,500
Scholarship BenefitINR 100 per month per child

Source: Press Information Bureau

What is not covered?

There are some excluded coverage instances in the Aam Admi Bima Yojana scheme. These include death or disability arising out of the following –

  • Self-inflicted injuries or attempted suicide
  • Insanity or mental disorders
  • Pregnancy or childbirth
  • War or related perils
  • Chemical, radioactive or biological weapons
  • Participating in dangerous and adventurous sports
  • Criminal acts or activities which breach the law

Moreover, medical expenses which are incurred due to an accident are not covered.

What is the premium under the scheme?

The Aam Admi Bima Yojana scheme has very low premiums. The premium is INR 200. 50% of the premium would be subsidized and paid from the Social Security Fund of the Government. Moreover, if the individual belongs to rural landless households, the remaining 50% of the premium would be paid by the State Government or Union Territory. If, on the other hand, the individual any of the recognised vocational groups, the remaining 50% of the premium would be paid by the nodal agency or the member himself/herself or the State Government or Union Territory.

What are the documents required to avail the scheme?

To get covered under the Aam Admi Bima Yojana, the following documents would have to be submitted by the eligible individuals –

  • A valid age proof. Age proof can include any of the following documents:
    • Extract from School Certificate
    • Ration card
    • Voter’s ID Card
    • Extract from Birth Register
    • Aadhar Card
    • Identity card which has been issued by a reputed employer or by a Government Department

Once any of these documents are submitted, the individual would be enrolled under the coverage.

How to make a claim under the scheme?

The process of making a claim under the Aam Admi Bima Yojana scheme depends on the type of contingency suffered. The claims are settled by LIC by a direct NEFT to the bank account of the beneficiary. If NEFT facility is not available, the money is credited to the bank account of the beneficiary after obtaining an approval from a competent authority. Moreover, if the approval has been obtained, the claim can be paid through an account payee cheque or through any other mode as chosen by LIC.

The different types of claims and their respective claim procedures are as follows–

  • Claim process for natural or accidental death
    • When the insured dies during the coverage tenure, the nominee should make a death claim on LIC
    • The nominee would have to fill up a death claim form and submit the form along with the death certificate of the insured to the designated personnel of the Nodal Agency
    • The designated officer of the agency would, then, check and verify the claim form. The form would then be submitted with the death certificate and a certificate stating the eligibility of the insured.
    • The documents required for death claim are:
      • A filled in claim form
      • Original death certificate and an attested copy of the death certificate
    • In case of accidental death, the following additional documents would also have to be submitted:
      • Copy of FIR filed with the local police
      • Post mortem report
      • Police inquest report
      • Final report of the police
    • Once the documents are verified, the death claim would be paid.
  • Claim process for disability
    • The insured can make a claim for disability by submitting all the necessary documents
    • The documents required for disability claim include the following:
      • Documentary proof of accident
      • Medical certificate issued by a Government Civil Surgeon or qualified Government Orthopaedic. The certificate would certify that the insured suffered permanent total or partial disability
    • Once the documents are verified, the claim would be paid to the insured member.
  • Claim process for Scholarship Benefit
    • The insured whose child qualifies for Scholarship Benefit should fill in an application form for the benefit.
    • The form is required to be filled half-yearly and then it should be submitted to the Nodal Agency
    • The Nodal Agency would, then, identify the students eligible to receive Scholarship Benefit
    • After identifying the students, the Nodal Agency would submit the list of identified students to the Pension & Group Scheme unit of LIC. The list should contain the following details of the students identified:
      • Name
      • Name of the school which the student attends
      • Class
      • Name of the insured member
      • Policy number of the master policy
      • Membership number of the insured member
      • NEFT details for paying the benefit directly to the bank account of the member
    • Once LIC gets the student list with the complete details, the scholarship amount is credited to the bank account of the insured member through NEFT. The payments are done on a half-yearly basis every year on 1st January and 1st July.

Implementation of the scheme so far

In March 2015, data was made available showing the implementation of the scheme. By that time, about 32.75 lakh lives were covered under the scheme. Other important figures included the following:

  • Claims were paid in the financial year 2014-15 under 42,000 policies amounting to more than INR 14.43 lakhs
  • Scholarship claims were paid to about 6.20 lakh children amounting to more than INR 41.81 crores.

Given the sufficient insurance cover and low premiums, the scheme is expected to become popular among the poor and would increase insurance penetration in the rural areas of India. This would, in turn, increase the standard of living of the rural population and help in the growth of the Indian economy.


The Aam Admi Bima Yojana was launched by the Government of India to provide free or subsidized insurance cover to the rural population of India or to individuals who belonged to the economically weaker sections of the society. The Aam Admi Bima Yojana is essentially a scheme of social security which aims for social welfare of the backward classes.

The scheme is currently being offered only by Life Insurance Corporation of India (LIC). Thus, interested applicants can avail the coverage only from LIC through its authorised Nodal Agencies.

Yes, nomination is a must when an individual makes an application for insurance under Aam Admi Bima Yojana scheme. At the time of application, the application form would also contain a nomination form which the individual should fill in and appoint a nominee. The details of the nominee should be clearly stated so that in case of a death claim the nominee can collect the claim amount easily. The nomination form which is filled and submitted by the insured individual would be kept in the custody of the Panchayat of the village or the Nodal Agency. The form would then be forwarded to LIC along with the death claim documents when the insured member dies.

The insured member would have to pay 50% of the premium, which is INR 100, only if he/she belongs to families Below Poverty Line (BPL). If the insured belongs to rural landless households or the identified vocational groups, he/she would not have to pay any premium for the scheme.

Coverage under the Aam Admi Bima Yojana scheme is available only for individuals belonging to BPL families, rural landless households or one of the 48 specified vocational groups. If you do not belong to any of these categories, coverage under Aam Admi Bima Yojana would not be available for you. You can, however, avail coverage for accidental death and disablement through personal accident policies which are available in the market.

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