The whole country celebrated the launch of insurance schemes by the Honorable Prime Minister Shri Narendra Modi in April this year. With crores of policies being sold by banks after their launch, the government has another huge task at hand. This involves detecting duplicate death claims and checking that no individual tries to exploit the insurance scheme benefits to his/her favor.
Pradhan Mantri Jeevan Jyoti Bima Yojana is a life insurance scheme introduced by the ministry of finance. The scheme aims to provide life cover of Rs.2 lakh to policyholders. The insurance scheme is non-linked, non-participating one year renewable term insurance product. The scheme will be administered by various public and private banks and will be guided by rules and regulations of the government of India. The annual premium amount to avail this policy stands at Rs.330 and is inclusive of administrative charges of participating banks.
What does CIBIL do?
CIBIL stands for Credit Information Bureau India Limited. The organization is India’s first Credit Information Company and focuses on collecting and maintaining credit records pertaining to loans and credit cards for various customers. CIBIL has a database of over 40 crore bank customers, 2.3 crore commercial loans and one crore mortgage depository data and hence the organization is capable of accessing insurance data for customers to authenticate claims made for life insurance death benefit.
It collects and maintains customer data pertaining to loans and credit. This customer data is sourced on a monthly basis from various member institutions which are mostly banks and other financial institutions.
All the credit related data of different customers is then processed individually to make credit reports for every customer and to deduce the final credit score for each one of them. These credit scores are then provided to banks (on request) and other lending institutes for use in sanctioning of loans.
How is CIBIL qualified to help track duplicate insurance claims?
Since CIBIL is the online credit data repository of the nation, the company has access to huge database of customers and also their insurance related data. This will make it easier for CIBIL to track duplicate death claims made by customer in order to exploit the insurance scheme and derive maximum benefit. There is also an initiative to shortlist a vendor who would build a database to provide a fraud monitoring framework. Since the reach of Pradhan Mantri Jeevan Jyoti Bima Yojana is quite deep, the government is worried that there will be massive attempts at exploiting the scheme and deriving unwarranted benefits.