Know All About Aam Aadmi Bima Yojana

In a country with a population of over 1.3 billion, 22% of the working mass make less than the international daily wage benchmark of Rs.143.

A majority of the workforce are left in a completely helpless situation during unexpected health emergencies costing their family an earning source. Precisely to address this issue, the government of India came up with the Aam Aadmi Bima Yojana.

Wondering what this scheme is and how it works?

Please read our guide.

What is Aam Aadmi Bima Yojana (AABY)?

The Aam Aadmi Bima Yojana was launched on 2nd October 2007 by the Indian government in the interest of workers in the unorganised sector. This social security scheme aims to offer financial assistance to lower-income groups against health impairment and death.

This was done considering the fact that these labourers, like street vendors, construction workers, fishermen, auto drivers, weavers, leather workers, etc., are not registered under any Act. Hence, they miss out on the government insurance schemes covering workers in organised sectors.

What is covered under the Pradhan Mantri Aam Aadmi Bima Yojana?

Now you might be wondering what sort of coverage can be availed from this government-aided scheme, isn’t it?

Here is a table detailing valid circumstances with the sum insured against them to clarify your doubts.

Type of emergency	Amount insured
Death due to accident	Rs.75000
Natural death	Rs.3000
Accidental partial disability	Rs.37500
Accidental permanent total disability	Rs.75000

In addition to the above benefits, an insured individual can also avail of an additional scholarship benefit for his/her offspring free of cost, in case of any eventuality. This coverage under the Aam Aadmi Bima Yojana scheme entails a monthly sum of Rs.100 per child. Note that this is applicable for up to 2 children only, and both of them have to be studying in 9th to 12th standards.

Exclusions under the AABY

A common misconception among individuals might be that since this is a health insurance scheme, it is bound to cover all kinds of medical expenses. However, like all other medical insurance policies, the Aam Aadmi Bima Yojana also has specific exclusions.

Following is a list of conditions/situations that are not covered under this programme.

Hospitalisation cost
Pregnancy and childbirth
Death or disability due to substance abuse
Injury caused by biological, chemical, or radioactive weapons
Mental illness
Injury from participating in extreme sports
Suicide or self-inflicted harm
Death or disability from criminal activities
Injury in war or war-like circumstances

From the above list, you can get a clear idea of how your family can benefit from this scheme.

Features of Aam Aadmi Bima Yojana (AABY)

In addition to the policy inclusions and exclusions, here is a list of some other key characteristics of this insurance scheme.

AABY’s primary goal is to provide social security to individuals who lack the means to access urban healthcare.
This policy entails a fixed insurance amount which varies depending on the type of contingency.
This entire coverage amount is paid at one go upon a claim.
The Aam Aadmi Bima Yojana is applicable for only one member per family. Therefore, you cannot avail the mentioned benefits if another family member has already reaped its fruits earlier.
Interested individuals can buy this scheme only through the Life Insurance Corporation of India (LIC) since it is the only insurance company offering this scheme at present.

Now that you know the important characteristics of this scheme, it is time to look at its advantages.

Benefits of Aam Aadmi Bima Yojana (AABY)

Here are some of the key benefits of this insurance scheme.

Subsidized and affordable premiums: This scheme comes with extremely affordable premiums compared to other insurance policies, 50% of which is government-sponsored. We’ve discussed this aspect in detail under the section about premiums.
Instant assistance: A digital database of scheme members facilitates the speedy exchange of information as and when required. Policyholders can easily contact their nearest LIC branch for a solution.
Hassle-free enrollment: Application and enrollment do not involve extensive documentation.
Simple claim process: Similar to the enrollment process, the process to file a claim is also made easy via the ABBY card.

However, note that you can only avail of these benefits if you meet the specific criteria for income, age, and profession.

Which professions are covered under the Aam Aadmi Bima Yojana?

As already mentioned, this scheme primarily focuses on individuals belonging to the lower-income group.

However, we understand if you are looking for specifics. If you want to know who the Aam Aadmi Bima Yojana provides social security to, refer to the following list.

Unorganised workers covered under Rashtriya Swasthya Bima Yojana
Fishermen
Firecracker workers
Paper product manufacturers
Agriculturists
Transport drivers association
Anganwadi teachers
Manufacturer of wood products
Transport karamcharis
Safai karamcharis
Auto drivers or rickshaw pullers
Overseas Indian workers
Manufacturers of earthen toys
Beedi workers
Women associated with self-help groups
Brick kiln workers
Forest workers
Hamals
Kotwal
Lady tailors
Carpenters
Handicraft artisans
Self-employed physically challenged people
Women of hilly areas
Papad workers associated with SEWA
Candle manufacturers
Sheep breeders
Handloom Weavers
Salt growers
Toddy tappers
Tendu leaf collectors
Cobblers
Leather and tannery workers
Individuals employed in printing rubber and coal products
Plantation workers
Sericulture employees
Powerloom workers
Coconut processors
Primary milk producers
Textile employees
Construction workers
Manufacturers of leather products

Besides belonging to any of the above professions, you also need to meet certain eligibility criteria to qualify for this insurance scheme.

Eligibility Criteria

Have a look at the conditions to enjoy a successful application.

The potential insured member must be aged between 18-59 years.
The applicant must be from a Below Poverty Line (BPL) family, Rural Landless household (RLH), or engaged in any mentioned occupational groups.
The applying individual must be the family head, regardless of being the sole earning member or not.

If you and your family are completely unfamiliar with this scheme’s whereabouts, here is a guide for your first-time application.

How to apply for the Aam Aadmi Bima Yojana?

Follow the given steps to apply online for the Aam Aadmi Bima Yojana.

Step 1: Go to the official website of the Life Insurance Corporation of India (LIC).

Step 2: Select “LIC Aam Aadmi Bima Yojana Apply Online” on the homepage.

Step 3: On the next screen, fill in the application form with accurate details.

Step 4: Upload scanned copies of all required documents and click on “Submit.”

Individuals who do not have access to the internet can also complete the AABY application procedure offline. Following are the steps for the same.

Step 1: Visit your nearest NIC nodal agency to get the application form.

Step 2: Just like the online process, fill in this application form with correct information here as well.

Step 3: Attach copies of all necessary documents with the application form.

Step 4: Go to your nearest LIC office and submit the items as mentioned earlier.

There you go!

Now, if you require more information about this scheme, send the following SMS to 9222492224 or 56767877:

“LICHELP <Policy Number>.”

What are the mandatory documents required when applying for AABY?

It can be difficult for a first-time applicant to keep track of all documents required for application. To address your concern, below is the list of all the required documents you must keep handy before applying.

Ration card
Aadhaar card
Voter ID card
Income certificate
Nominee application form

Confirm the requirement of any additional document, and make sure to provide the same with your application form.

Once you have made it through a successful application procedure, you might be concerned about the premium you need to pay. Well, we’ve got that covered as well!

What is the premium charged by the Aam Aadmi Bima Yojana?

Like any other insurance plan, the AABY scheme also comes with premiums, although nominal. Yes, since this plan aims at easing the lives of low-earning workers, the annual premium is set at Rs.200 only against insurance coverage of Rs.30,000. On top of that, 50% of this amount is already paid by the Central government.

Additionally, individuals belonging to the following categories can enjoy the subsequent benefits.

Rural landless households (RLH): Remaining 50% premium is paid by the UT/State government.
Recognised vocational groups: The rest 50% premium is paid by the nodal agency or UT/State government.

Therefore, if you are a part of the groups mentioned above, you can claim the benefits of the entire scheme under Aam Aadmi Bima Yojana against zero-premium!

How to raise a claim under the AABY scheme?

Depending on the type of contingency suffered, your go-to insurance claim process may differ.

Here, we list all the possible scenarios under which you can raise a claim and their respective procedures to be followed.

1) Death due to an accident or natural causes

Upon the insured individual’s death, a nominee can make a death claim in the following steps.

Step 1: Fill in the Aam Aadmi Bima Yojana death claim form.
Step 2: Submit it along with the policyholder’s original death certificate and an attested copy to the concerned Nodal agency official.
Step 3: Upon verification, the official will submit the claim form along with provided documents and the deceased policyholder’s eligibility certificate.

Note that in the case of accidental death, nominees will also need to submit copies of post mortem report, FIR, police inquest report, and final police report.

2) Partial or total disability

To file a disability claim, the insured need to submit the following documents besides the Aam Aadmi Bima Yojana claim form.

Documents with proof of accident like police FIR.
A medical certificate stating the details and type of disability. This must be issued by a registered Government Orthopaedic or Government Civil Surgeon.
Scholarship benefit

If your child is eligible for scholarship benefit under AABY, then you need to fill in the Aam Aadmi Bima Yojana scholarship online application form and submit it to your Nodal agency.

This procedure needs to be followed every 6 months for the nodal agency to cross-check if your child has crossed the qualifying limits. The agency will then send the list of identified students to LIC’s Pension & Group Scheme unit.

This list must contain the following details against each beneficiary.

Name of student
Class
Name of school
Name of the insured
Aam Aadmi Bima Yojana policy number
NEFT number
Insured member’s membership number.

Upon receiving the full list of eligible students, LIC will transfer the scholarship amount to the policyholder’s bank account via NEFT.

Given the several intricacies of this entire procedure, it is possible for interested individuals to have confusions and queries.

Well, for that, you can contact the Aam Aadmi Bima Yojana helpline number available on LIC’s official website. You can also forward your queries through the contact details of your nearest LIC branch.

Frequently Asked Questions

✓ Under which conditions can I avail coverage under partial disability and permanent total disability?

Partial disability refers to the condition where an individual can still work for a living and includes loss of one eye or limb. Permanent total disability refers to the loss of both eyes, both limbs, or one eye and one limb. Depending on the type of disability, insured individuals can avail insurance amount accordingly.

✓ Do I have to appoint a nominee during the AABY application?

Yes, it is mandatory to appoint a nominee when applying for this insurance scheme so that a claim can be made upon the insured individual’s demise. For this, you need to duly fill in the nomination form provided with your application form before submission. This form will then remain with the Nodal Agency until the latter transfers it to LIC upon a death claim.

✓ What is the role of the Social Security Fund?

The aim is to make the AABY insurance plans affordable for economically backward workers. This is why the Central government set up the Social Security Fund to subsidize half of the premium amount.

✓ Can I apply under the Aam Aadmi Bima Yojana again after my family’s previous policyholder is dead?

No, the Aam Aadmi Bima Yojana is valid for up to one application per family only. If your family’s policyholder expires, you can benefit from the existing coverage by filing for a death claim. However, you cannot apply to avail of this scheme’s benefit a second time.