IRCTC Plans To Provide Passenger Insurance Of Rs 10 Lakh; Rs 2 Would Be Per Trip Insurance Expense
In one of the historical decisions made, Indian Railways will now provide insurance upto Rs 10 lakh for all passengers. At a cost of Rs 2 per trip, per passenger, this is probably world’s cheapest, mass-scale insurance policy.
We had earlier reported that IRCTC, on behalf of Indian Railways, has already started the process of initiating travel insurance for all passengers.
As per latest reports, IRCTC has shortlisted three insurance providers for this massive exercise, and rules pertaining to insurance would be announced soon.
Arun Kumar Manocha, Chairman and Managing director of IRCTC, said, “We are going to start passenger insurance soon and have already issued letter of award. We have short-listed three companies. The insurance would be less than Rs 2 per trip for a sum insured of Rs 10 lakh,”
After ICICI Pru Life filed for India’s first insurance IPO in 6 years, this decision by Indian Railways will be a shot in the arm for overall insurance industry.
Travel insurance has still not picked up steam in India, as presently, only airlines offers such plans and packages while booking tickets. Comparably, travel insurance is more than $2 billion market in America alone.
During 2014-15, Indian railways ferried 2.5 crore passengers daily. Even if just 30% of them chose to opt for an insurance of Rs 2 per head, then Indian Railways will earn more than Rs 500 crore from insurance charges. It is still not clear whether this insurance would be compulsory or an optional feature.
Besides Insurance, Indian railways will also introduce a host of new features:
- Unreserved bookings would be now made structured. Unreserved ticketing constitutes a major portion of Indian Rail’s 2.5 crore daily passengers. Earlier, a dedicated app for booking unreserved tickets was launched by IRCTC
- IRCTC has partnered with SBI’s mobile wallet ‘Buddy’ to seamless payments during online bookings
- IRCTC is working on an Android software, which will simplify the process of cancellation of e-tickets, and enable faster refund of money
- IRCTC is partnering with Central Food Technological Research Institute, Mysore, and Institute of Hotel Management, Catering & Nutrition, Pusa for providing better services for passengers. We had earlier reported that IRCTC is joining forces with DRDO for providing high grade, ready to eat food for passengers
- IRCTC’s own e-wallet would be re-launched with better options and features
What is your opinion on low cost, mass insurance service for rail passengers? Can it change the entire insurance sector of India? Do let us know by commenting right here!