Insurance firms plan repositories to prevent claims fraud

New Delhi: To avoid fraud in the government’s recently launched social security schemes, providing

life and accident insurance cover to a majority of Indians, insurance companies are looking to set up a claim repository. The measure is aimed at preventing individuals from filing multiple claims, said insurance industry officials.

Finance minister Arun Jaitley announced the launch of the Pradhan Mantri Suraksha Bima Yojana (PMSBY) and the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) to provide accidental death and disability cover and life insurance cover, respectively, in this year’s budget speech.

The schemes were subsequently launched by Prime Minister Narendra Modi.

In just over a month since the launch, more than 100 million people have enrolled themselves in these schemes, according to data available with the government.

Insurance companies are bracing for multiple claims, fearing that the low and subsidized premiums may encourage individual policyholders to apply for several policies through multiple bank accounts held by them.

“The general insurance council will set up the claim repository for PMSBY and the life insurance council will set up the claim repository for PMJJBY,” said the chairman and managing director of a state-run general insurance company who did not want to be identified.

Another insurance industry official said that various options are being considered for “de-duplication”.

“Once the claims start coming in and increase, we need to see how to ensure that claim de-duplication is done,” said the insurance industry official who also did not want to be named.

People in the age group of 18-70 years having a bank account are eligible to get a policy under PMSBY.

Under this scheme, accidental death and full disability cover of Rs.2 lakh and partial disability cover of Rs.1 lakh is available at an annual premium of Rs.12.

The scheme is mainly being implemented by government-run general insurance companies.

PMJJBY, currently being offered by the Life Insurance Corporation of India, is available to people in the age group of 18 to 50 years. The scheme offers a life cover of Rs.2 lakh for an annual premium of Rs.330.

In both these schemes, the main criterion is that the policyholder should have a bank account linked with Aadhaar, with the premium auto-debited from the bank account.

“Many insurance schemes have been announced in the past few years by the government, but they remain only on paper. No implementation agency has so far managed to contact a large number of villages and convince people to subscribe to these schemes,” said N.C. Saxena, former member of the National Advisory Council.

“These schemes will also remain only on paper and will soon be forgotten,” he added.