Finance Minister P Chidambaram on Sunday stressed the need to provide a safety net for the poor by bringing them under insurance cover.
"There are 80 per cent people, mostly poor, without any insurance cover in the country. The reach of the insurance is still confined to better-off people of the middle and lower middle classes," Chidambaram said after inaugurating a zonal office of the Life Insurance Corporation (LIC) in Patna.
India is one of the most under-insured countries in the world as most of the poor are without any insurance cover, he said.
In his address to LIC officials and agents, he said: "We must reach out and take insurance to the poor. It is the poor who require life insurance, health insurance and accident insurance more than the rich and better-off people."
To that end, the government was introducing a new scheme, Aam Admi Bima Yojna, from Oct 2, he said. It will provide death, accident and disability insurance to rural landless families.
The central government will bear 50 per cent of the premium of Rs 200 per year per person and the state government the remaining amount.
"Aam Admi Bima Yojna's goal is to reach every poor men in the country," he said.
Initially, the government will cover 10 million poor families under the new scheme and later it will be extended to all poor people.
"The government is entrusting LIC to cover 10 million poor under the scheme. The LIC has the capacity to deliver Aam Admi Bima Yojna to the poor," he said.
The function was attended by Railway Minister Lalu Prasad, Steel Minister Ramvilas Paswan and Bihar Chief Minister Nitish Kumar.