Typically, support staff — drivers, maids, cooks, and security guards, among others — have limited savings and unexpected natural disasters, ill-health or death can wreak havoc in their lives. Many of these risks can be insured. Historically, the products available in the industry have been few and restrictive.
However, over the past few years, the Government has made a concerted effort to introduce health insurance for the poor. The insurance products are cheap and easy to buy. Encourage your staff to understand these products and buy them from your local bank. The costs are largely subsidised.
Available insurances include a term insurance, accident insurance, pension scheme and health insurance. The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)
Unique accident cover
The personal accident insurance called Pradhan Mantri Suraksha Bima Yojana (PMSBY) pays ₹2 lakh if the insured dies due to an accident or is completely disabled. If there is partial disability and, for example, one limb is lost, ₹1 lakh is paid.
The insurance is available for those in the 18-70 age group and the premium is ₹12 per year. If a person has bought both the term plan and accident insurance, a sum assured of ₹4 lakh will be paid in case of accidental death.
The advantage of the PMSBY insurance is that it can be bought until the age of 70 — a full 20 years more than the term insurance plan. Therefore, this is the only option of death cover if you are over 50.
Atal Pension Yojna (APY) is a pension plan that provides a monthly pension of ₹1,000-5,000 after the person turns 60; after the individual’s death, the spouse is paid and, finally, a corpus is paid to the nominee. APY can be bought by people in the 18-40 age group. The premiums depend on your age. For example, if you buy the scheme at 40, you will need to pay about ₹1,500 a month to get a monthly pension of ₹1,500.
These insurances are best bought through your local bank. Instructions can be given to the bank to automatically deduct the premium from the account. Renew these insurances each year.
Scheme with a difference
The Ayushman Bharat Scheme has been introduced recently to provide health insurance for the poor. The insurance will be provided free to eligible persons. Unlike previous health schemes, the sum assured of ₹5 lakh is high and will empower the poor to visit any hospital on the panel.
All eligible persons will be pre-enrolled into this scheme, which means that they can simply walk into a panel hospital with their Aadhaar cards and be treated. The insurance will cover hospitalisation and also several day-care procedures. No pre-existing exclusions are allowed.
Given the scale of the project and with over 100 million families to be covered, there will be start-up issues. However, if these are streamlined, the insurance will have a big impact on the health of the poor. If you are in a State that has rolled out the scheme, make sure your staff is aware of this facility and identify the hospitals close-by that are on the panel.
Buying these insurances is a one-time effort. You may need to accompany your staff to the bank to get this done. But it is worth the effort.
The writer is Managing Director, www.securenow.in