Less than 50% of rail passengers have insurance cover

Passengers who book tickets at railway counters and those travelling in general coaches do not have any insurance coverage.
The interface of e-Ticketing website. (Photo | IRCTC website)
The interface of e-Ticketing website. (Photo | IRCTC website)

BHUBANESWAR: The deadly Odisha train tragedy that claimed 288 lives and left over 920 injured has brought to the fore a serious issue of train journeys not being covered by insurance unless opted for in the online booking of tickets.

Railway sources said most passengers travelling in trains or the parcels transported by them are not insured. Insurance is only available for passengers booking their tickets online, but it is optional too.
While Indian Railways Catering and Tourism Corporation (IRCTC) offers passengers insurance coverage up to Rs 10 lakh at a premium of 35 paise, no insurance component is involved in tickets purchased or booked at railway counters. Passengers who book tickets at railway counters and those travelling in general coaches do not have any insurance coverage.

Over two crore people travel in trains in the country daily and if insurance coverage of passengers is any indication, at least 50 per cent do not have any. Only a little over 50 per cent of passengers getting tickets online opt for travel insurance, sources said. 

In the context of the Odisha train tragedy, the railway has announced ex gratia of Rs 10 lakh in case of death, Rs 2 lakh for grievous injuries and Rs 50,000 for minor injuries while state governments concerned have also declared ex gratia and compensation packages up to Rs 5 lakh for the kin of victims.

Those who had booked tickets through IRCTC would get an additional Rs 10 lakh for death, Rs 10 lakh for permanent disability, Rs 7.5 lakh for partial disability, Rs 2 lakh for hospital expenses on injuries and Rs 10,000 for transportation of mortal remains. Most of the crash victims will not get the benefits as they were travelling in general coaches, which bore the brunt.  

Less than 50% of rail passengers are insured

Though Indian Railways is the fourth largest national railway system in the world by size and carries over 800 crore passengers every year (808.6 crore in 2022), experts wondered why all passengers cannot be insured.

“If IRCTC can offer death coverage of Rs 10 lakh for train travellers, why cannot Indian Railways make the insurance coverage mandatory for all its passengers? They can seek a premium from the passengers like IRCTC does and insure the travellers as the corporation does through insurance companies,” suggested Pravakar Jena, senior manager of a life insurance company.    

Railway officials said insurance was in-built in all train tickets over a decade ago. But, it was stopped after insurance companies backed out citing huge losses due high incidence of train accidents in those years.
Indian Railways, however, pays a compensation of Rs 8 lakh as awarded by Railway Claims Tribunal (RCT) for death of passengers and as decided on the basis of loss of earning capacity. This means all kin of 288 deceased and 920 injured can apply for claim from RCT but it would be long-drawn process due to documentation involved.

“For that, the kin of the deceased family has to provide all supporting documents. Similarly, the parcels are insured with the condition that the consignor opts for payment of percentage charge on excess value declared and paid subject to a maximum of one per cent,” he added.

Many of the passengers who faced death, or injury of serious nature came from extremely poor financial background. Applying for claims would require knowledge of the RCT process and a protracted process of follow-up.

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